Yesterday the Senate Finance Committee did everything in its
power to squash the proposed public option to health care reform.
Beating back two amendments, it would seem the inclusion of a public
option to a Senate passed health care reform bill is, at best, unlikely
(despite what Senator Tom Harkin says).
But the New Republics Jonathan Cohn has a very interesting article
on health care in the Netherlands. The Dutch health care system
achieves near universal coverage, provides quality care, enjoys high
satisfaction ratings from users, and is affordable. And it's based entirely on private insurance.
There's a caveat however:
Private
insurance in the Netherlands works because it operates more or less
like a public utility. The Dutch government regulates industry
practices tightly--more tightly than the reforms now moving through
Congress propose to do in the United States. The public insurance
option was supposed to make up for that deficiency, at least in part,
by setting a standard for service and affordability that the private
industry would have to meet--and by offering a fail-safe option in case
the private plans simply couldn�t keep up.
Cohn notes the Dutch government outlaws rescission,
prohibits the insurers from either declining or charging higher
premiums to those with pre-existing conditions, and requires the
minimum coverage to include chronic care and catastrophic care
provisions. And just in case the private insurers find a way around
the government restrictions, tax credits are provided to insurers with
an overabundance of unhealthy, and more expensive, beneficiaries and
fees are levied against those insurers with the healthier clients -
"risk equalization" as Cohn calls it.
The whole rationale for the
public option has been to provide a low cost alternative to the private
insurers and to act as a competitor to keep private insurance premiums
less expensive. As the Dutch have demonstrated, the same objectives
can be met without a public option by implementing transparency and controls over how those private insurers do business.
If
the public option is, indeed, doomed, there's still a way to make
private insurance affordable and responsive to the needs of its
customers. But it involves Congress stepping up and implementing tough
measures to change and monitor the business practices of the private
insurance companies.
That, however, may be even less likely than the Senate passing a public option plan.
Switzerland too has highly regulated private insurance where the insurance companies are not allowed to make a profit on basic care. This will only work in the US if health insurance is divorced from employers. A second problem is for it to work insurance must be mandatory and there may be constitutional issues in the US.
ReplyDeleteThe problem seems to me to be not so much about coverage, but about profit. One of the best parts of the Danish, Canadian, and Japanese systems is that the payers are always not-for-profit. They have no principal responsibility to shareholders. Back in the days when most insurance companies were mutuals rather than stock companies, insurance was better, cheaper, and didn't play the games they play now to achie ve large profits. of course, the insurance executives didn't get large stock options then either.
ReplyDeleteGP's in the Netherlands have earnings comparable to U. S. internists but specialists in the U. S. make quite a bit more. Unless you can figure out a way to ratchet specialists' incomes down quite a bit here a Netherlands-style system would be incredibly expensive in the United States.
ReplyDeleteThere are all sort of models out in the rest of the world, unfortunately you guys seem to be stuck with a dysfunctional legislature and a nice but increasingly befuddled executive. Strange that the "public option" is now considered the magic bullet which, of course, it may not be if, or once, a compromise comes out of the congress' committee process. I guess I agree the ultimate problem, outside unresponsive gov't, is the intermediary, between patient and provider, that runs strictly on an unregulated free-enterprise basis. But that's an ideological issue, I think. How LBJ would fix that particular stumbling block would be by simply driving the damn single payer legislation through. He always had fire in his belly for a domestic policy that could improve the lives of ordinary people, I think.
ReplyDeleteThere are some interesting anecdotes about LBJs little victory and what really went wrong with the Clinton flub in the NYRB's. The view expressed about Hillary's little fiasco is similar to what Brad DeLong was saying way back when about her when he sided with Obama, he having been one of the officials tasked with working with the lady on that old try.
If the goal is simply to reform health insurers, don't expect costs to drop too much.
ReplyDelete