Sometimes John Edwards almost reaches the level of self-parody when talking about the “two Americas” while building himself a 28000 sq. ft house, etc. Today he got some deserved catcalls from Morrissey and Althouse, especially for his plan to add mandatory mental health testing to his universal health plan. (Mirror, mirror, on the wall….)
But this all got me to thinking a bit about health and health plans, something with which I am sympathetic because, well, I am getting on and, as the Yiddish bubbes famously said “So long as you’re healthy, it’s the main thing.” And who can dispute that?
Or, as another man once said, we are endowed with certain inalienable rights – “life, liberty and the pursuit of happiness” – only the latter two aren’t worth much without the former. So, call it what you will, it’s kind of disgraceful fifty million Americans don’t have health insurance – what with the USA spending more on medical care than any other country, something like sixteen percent of GNP.
But what to do, what to do…. aye, there’s the rub. Well, what about Switzerland? Those guys with the cuckoo clock – you know, the ones Orson Welles made fun of in The Third Man. They have a plan that seems to be working pretty well…. or maybe I’m misinformed (and there are only seven million or so of them, so it’s nowhere near as tricky). But you can read about it here: Swiss health-care system might serve as model for U. S. And guess what? It’s all private, it costs less money and they did it without John Edwards. (All good in my view). I only have one question – are you allowed to eat cheese? Because my cardiologist says absolutely no. [Fire him.-ed. I'm planning on it.]
UPDATE: Regarding the Swiss system, reader Dennis Vogt sent the following email:
Some years ago I was at a dinner party in Zurich with a group of Swiss docs. I am a US lawyer. The key features of their system, which wasn’t covered in your post was this. All docs are employees of the healthcare delivery organization and there are no malpractice lawsuits. Poor practitioners are assigned to something safe like doing autopsies or admin work. They all agreed the salaries they got were more than acceptable particularly since all they had to do was practice medicine. They didn’t have to be in business or worry at all about back office management issues. To a person, they said they wouldn’t trade what they had for more money in America with all the attendant grief. Don’t know whether Swiss still do this but would be worth checking out. It is certainly a distinction which makes a hugedifference and explains some of their success.
What is coerced mental health assessment without coerced mental health treatment? The system can only “save” money by actually treating people deemed “at risk”. Otherwise it adds costs without economic benefits. Gee wouldn’t it be something if one of the criteria for diagnosing a “mental problem” were the avoidance of one’s mandatory mental health appointment. Then we really would be on our way to Szasz’s dystopic vision of The Therapeutic State.
The Swiss model has interesting features, but economists generally tell us that price controls have hidden costs. Supply and demand push back somewhere in the system. A brief newspaper article doesn’t try to address that potential problem with the system.
There are two hidden issues in healthcare.
First, healthcare is a science. Especially in pharmaceuticals, you have a system that depends largely on research and development. It costs about $800 million dollars to develop the average drug, and usually they aren’t blockbusters like Viagra. And there’s a time limit since you patent a drug, then go through the approval process, and there’s only a short time at the end to reap enough profit before generics swoop in and slash the prices. I’m not sure but I think non-pharma medical devices and procedures have similar economics.
The high cost of healthcare is also partially because nationalized systems such as Europe’s or canada’s don’t produce alot of margin that can be applied to R&D costs. We’re in effect subsidizing technical advances that they then benefit from. If we go national, though, who subsidizes us?
Second, healthcare is extremely litigious, like everything in our society these days. It’s insane what doctors and nurses pay in liability insurance. I don’t think John Edwards would consider tort reform, but honestly the republicans had all three branches of government and didn’t get it done either. But that’s another major cost: tithing to our lawyers.
Third are the high sales and marketing costs, at least for pharmaceuticals. I’m honestly not sure about those. They aren’t wildly out of synch with other products, but is there room for savings there if that is curtailed? Who knows. Presumably those costs make sense or the companies would cut them and pocket the profits. But I just don’t know for sure.
So those are in my mind the controllable costs for healthcare. We obviously need research and development, we obviously don’t need the insane direct and indirect costs of litigation. I guess most of these plans really amount to shifting *who* foots the bills, the rich or the poor, the sick or the healthy. But after that, you can either have cheap healthcare or good (ie available and effective) healthcare. Pick one of the two.
Oh one other thing. In the original article it says,
What does that mean? Can they make a profit or not? Or does that mean that they compete for profits by upselling people to plans that have the deductibles and benefits that DO earn them profits?
I don’t think you need to have price controls. I was just looking at personal (independent – non employer or government) health insurance and was surprised by what I found. I went to Insurance dot com and got quotes for a 37yo male smoker and a 29yo female non smoker and saw we could get catastrophic insurance for well under $200 a month. I checked and two 57yo (1M & 1F) non smokers could get catastrophic for under $300 a month. A 22yo male non smoker could get coverage for about $40.
You have a deductible but can use a Health Savings Account (HSA) to pay for the deductible tax free and your yearly contribution can stack over the years, get interest and be applied to any medical cost including vision and dental. Further, if you die it goes to a beneficiary. And, here is why I don’t think we need price fixing, you get big discounts even for stuff that isn’t covered because the insurance company has negotiated rates for everything.
All of this is purely market based, except for the HSA being tax free, and is very affordable. When you consider that poor and the elderly have government insurance I have to wonder exactly where the crisis in health care is coming from!
Really, the only problem I see is in regards to having a pre existing condition. As to that I think we should consider mandating that companies provide some kind of plan at a reasonable cost. In the end everyone else’s coverage would go up a few bucks but that is better than a government takeover.
I read it as saying the companies make their profits (or attempt to) by selling fancier policies that cover more things. They aren’t going to be guaranteed profits, but that’s where they try to make a profit.
The US is a pharmaceutical powerhouse, and everybody wants our drugs. The American healthcare consumer is partly subsidizing the helathcare of other countries, because we end up paying top dollar for our new pills, while other countries negotiate bargains. I think it would be interesting to know what malpractice insurance and policy is like in other countries. I rarely see anything about that mentioned in articles which glorify socialized medicine. In other words, would the US have to completely reorganize Tort law in order to establish socialized medicine?
I think we have to come to terms with the fact that the best options for US Health Care may be neither Socialist nor Capitalist. Capitalism seems to work well, when the consumer has a choice/options. With healthcare the basic options are Yes/No, there isn’t much for a Free and Open economy to work with. If I don’t like my employers coverage… I can do without, or I can pay about 4 times as much for a plan that doesn’t cover me as well.
If I didn’t have to job I do, then my options would be “No Healthcare”, or the stuff that costs about $500 a month. I can’t really go shopping for differences in prices, because the options are pretty static. However, the idea of socialized medicine has a whole different set of issues, namely the government’s involvement in private issues. After all, if all medical insurance were privatized, would coverage depend on the metaphysics of the party in power? When Dems are in, abortion, birth control and Morning After pills get covered, but when the GOP is in, none of them do? What a messy idea.
Tort reform seems a must to begin with.
Bringing the Insurance rates back into the realm of reality would be good as well. $500 or $600 a month is simply insane for healthcare (as seems to be the case with the Swiss). Sure, we have to help with the research of future medicine, but most of that 500+ isn’t going to research, its going to the insurance companies. My insurance company is United Healthcare… when we look at their stock.. why they’re profiting in the millions. Their CEO picked up $1.8 billion in stock options over the past few years, not counting his salary, or the bonuses and salary of all the other C*O’s of UHC. So, if the lawyers weren’t making millions while their clients sued for billions and if the Corporate executives weren’t making millions (with billions in options) in salary… maybe people could actually afford medical insurance.
We live in a time when our economy has become a retarded brother to Capitalism. Customers have forgotten that they are part of the system (moving their custom from one supplier to another) and have become consumers, simply consuming what they’re sold, even with its nothing more than a cat in a bag. At the same time, instead of focusing on the service/product being sold and a fair market value… corporations are sucking money as fast and hard as they can (see above example).
When a good capitalist finds a goose that lays golden eggs, they form a corporation to seel the supply and make some capital. Today, we’re machine feeding the goose, adding hormones to force it to squirt out 5 times the eggs and wondering why the goose is pissed and the eggs are kinda rotten smelling (*sniff* “smells like sulpher and sub-prime mortgages”).
Bringing the Insurance companies and Legal firms back into the realm of reality, rather than High Profit at all costs, would go a long way toward making health insurance a normal service… like auto insurance, homeowners insurance, renter’s insurance… options that are of a sane and reasonable cost.
While it doesn’t really take away from your comment, the “50 million” figure includes a number of people who choose not to get health insurance for various reasons.
A questions about mandatory insurance programs… would we mandate an HMO-level if insurance or more of a basic catastrophic care level? Would it vary with age? Would there be a way to opt out?
I’m generally against more government meddling in health care but mandatory insurance with required basic levels (similar to how Texas does auto insurance) seems like a workable compromise. There should be some flexibility, though… a healthy 25 year old shouldn’t have to get a full-blown HMO with a low deductible if they don’t want to spend the money.
I would love to see health insurance de-coupled from employment so that people could get insurance based on their needs/wants and not have to worry about changing every time they change jobs. Unfortunately, companies can get group discounts to reduce their prices so I’m not sure how you would get around that if individuals bought health care. They also hide part of the cost by paying it “for you”, thus reducing your effective compensation if you don’t buy health insurance through them.
As an aside, I’d really rather have my wages show ALL deductions rather than requiring employers to “pay” part of my taxes, ss, etc… in the end, it all is counted against my total compensation anyway and if it was all shown on my pay stub I’d at least know what my real compensation was (and how much of it I wasn’t getting…).
EI
Universal health insurance is a canard. Its establishment is founded on the vapid concept that EVERYONE’S health needs (and wants and demands and kvetches) should be paid for by someone else.
That means that vast establisments of gatekeepers and goalies and paper-pushers, advertisers and consultants and naysayers must be hired in perpetuity, their paychecks and benefits and retreats and vacations diverted from funds which should have paid for health care.
Yes, health insurance for rare or catastrophic events or expenses beyond some practical statistical level. But the living of life entails a certain level of doctor bills. Better to pay them up front and personal, than to sink the same funds PLUS enormous overhead into some mandatory bureaucratic nightmare of the sort that nurtures the unearned wealth of the John Edwards brigade.
I’m sure that FDR’s spread in Hyde Park dwarfs John Edwards’ compound in North Carolina. Few suggested then, however, that his wealth disqualified him from being a legitimate champion of working people and the poor. Just what is the income level below which a citizen is permitted to care about issues like reducing poverty and wealth disparity levels, without being accused of hypocrisy?
Also, as is pretty clear from the AP article, there is no “mandatory mental health screening” in Edwards’ plan. One component of that plan involves provisions for preventative care, such as yearly check-ups and so forth. Another involves mental health parity initially championed by Paul Wellstone, and today most prominently supported by that notorious socialist from New Mexico, Senator Pete Dominici.
Other components in Edwards’ plan mandate minimal levels of eye care, dental care, etc.. The part of the plan dealing with mental health services is seperate from the parts dealing with preventative care. As with these other specializations, or with a cardiologist or an oncologist, one would only be referred to a mental health specialist if one had a particular symptom requiring their services.
> I’m sure that FDR’s spread in Hyde Park dwarfs John Edwards’ compound in North Carolina. Few suggested then, however, that his wealth disqualified him from being a legitimate champion of working people and the poor.
The rules were different then. The left hadn’t argued that only blacks understood blacks, and so on.
The new rules are dumb, but the left doesn’t get to complain about their application – they only get to try to undo the damage that they caused by changing the rules back.
Roger,
Taking issue with a few of your points:
… it’s kind of disgraceful fifty million Americans don’t have health insurance …
“Disgraceful?” Why in the name of Zeus do so many commenters on this subject assume universal health care is some kind of socialist nightmare but universal health insurance is an unalloyed good? Because someone else will pay? I’m a proudly self-employed and uninsured American who has the audacity to actually pay his doctors because I think those mandated by insurers are lousy. Sure, I have an ultra-high deductable plan for emergencies but — believe it or not — that doesn’t “count.” (Probably due to the low cost.)
Might I politely suggest that the health of the citizenry is a far better measure here than the number of uninsured? Correct me if I’m wrong, but are people dropping off in the streets? Is our life expectancy plummeting?
I further suggest that if you’re obsessing over this statistic you’re already playing in Mr. Edwards’ neighborhood. He knows this, of course, and these ridiculous proposals are simply his way of pushing the political envelope.
… – what with the USA spending more on medical care than any other country, something like sixteen percent of GNP.
… and will continue to grow until health services in this country are reconnected to consumer pricing, or at least compete among themselves on the same. No one — except those evil insurers — has any current incentive to limit costs. Combined with utterly perverse tax incentives (e.g., corporations — but not individuals — can deduct costs pre-tax) and the ability for anyone to waltz into an emergency room is it any wonder we have exploding costs and a broken “system”?
I actually have a chapter in my book about health insurance and how we got into the mess we are in. The short version is that we have all sorts of perverse incentives built in. So does the NHS and the French health plan and all the rest. The Swiss plan sounds pretty good. Two problems we have that they don’t are an urban underclass and illegal immigrants. Of that 50 million uninsured you mention, about 12 million are illegals. The LA County Hospital, where I spend hours every week, is about 50% occupied by illegal immigrants. The Workers Compensation System of California, where I work about 25 hours a week reviewing questionable claims, is about 60% Spanish speaking workers. The fraud is probably higher with illegals than with the average worker but it is a huge problem.
What solution do I suggest ? We need some combination of a basic public health system, which will care for trauma and illegals and the poor who will never be able to care for themselves, plus a free choice plan for the rest. Canada made a serious mistake by forcing all choice out of their system. Britain did for a while but the public rebelled and Thatcher put back private care as an option. About 25% of the population of southeast England, the only area that actually supports itself, has private insurance. France has a pretty good system with free choice, as I understand it, but are having trouble with cost. The problem is with incomes, not the cost of care. French incomes are stagnant.
One major problem is that Johnson’s Great Society did all it could to destroy the great public hospitals we once had. Medicaid would not pay for care in the big county hospitals. The teaching hospitals are punished for charging for care by resident staff even though the care is cheaper and better than most small hospitals. The solution won’t be easy. And it won’t be some grand master plan like those being pushed by the left. It will probably be a combination of many approaches and it will take years to work through all the bugs.
I heard this suggestion today and think it’s a good idea. Why don’t we have national legal care? We could limit the number of candidates to law school. We could dictate where they set up their practice and what types of law they serve. We could limit their income and cap their fees like we do for Medicare and Medicaid. Something tells me that lawyers like Edwards and Hillary wouldn’t think so highly if the same ideas were applied to their profession.
Come on, why should we limit it to medicine?
markus
The story doesn’t say mandatory mental health screening, so your point on that is good.
However, it does say “…that women would be required to have regular mammograms in an effort to find…” A couple of points: 1. what about a woman’s right to choose or control over her body? How does a Democrat say the state knows best in that area? 2. Where does one stop once mandatory screening is required? By what principle will he (or anyone) say this screening is mandatory (breast cancer) and this (mental health or prostate cancer or whatnot) is not? Why not mandatory mental health screening if some bean counter convinces him (or whomever) that it will save a buck? Once mental health is viewed as nothing but healthcare, the logic of treating it like nothing but healthcare is inescapable.
It isn’t Edwards’ income level that is at issue. The issue is his preaching that others need to conserve (even people well below his income level) while he appears to waste resources (it’s good for thee but not for me). If he doesn’t understand the public relations problem there, then I suggest some mandatory mental health screening for him.
FDR hid quite a bit about himself from the public in order to get and stay elected, even if people knew he was wealthy. Most people saw his job as to get us out of the Depression, i.e., help generate economic activity so people would have higher incomes (a gross oversimplification) and consume more, even if not quite at his level. One could pull a Bentsten on Edwards “… John, you’re no FDR.”
This data is quoted from John Stossel’s recent article about the myths of the uninsured.
He quoted WHO numbers, I believe. According to these numbers, 45 million people in the US have no medical insurance.
37% of these (16.7 million) live in households making more than $50,000 a year, and 19% (8.6 million) make more than $75,000 a year. Health insurance is available for people at these income levels; they simply choose to spend their money on other things.
20% of the uninsured (9 million) are not citizens. I have trouble with the concept that I should be taxed to provide health insurance for this group.
Besides, the absence of health insurance does not any more mean they don’t get care – check out your own local ER waiting room – than the absence of auto insurance keeps them from driving.
33% (15 million) eligible but not enrolled for existing government programs, which leaves 4.3 million truly uninsured or uninsurable (1.4% of the population).
Do these numbers make a strong argument for the “socialization” of 1/7 of the economy? Or more importantly, will the “45 million uninsured” meme be sufficient to bring it about?
There are a multitude of perverse incentives and conflicts in the system. It is difficult to know where to begin. However, no one under the current system is truly incented to disclose or control costs (i.e. doctors, hospitals, insurance companies, patients).
Popeye’s reference to Stossel’s article puts the headline number in a better perspective. Price controls, government run and other manipulated systems all end of costing consumers more whether it comes in the form of sacrifice of innovation, longer waiting times to receive care, and lower quality care among other things. Sometimes the cost is death. The people who push those systems ignore those costs.
The primary thing required to fix the problem is to make healthcare consumer driven. Once consumers can determine price and quality, more informed choices can be made (and full disclosure of costs is part of it). Doctor and hospital performance needs to be known. HSAs are a part of it. So is tort reform. Dealing with illegals is another issue. Patent protection and the cost of getting new medications to market is critical. Higher costs for risky lifestyle choices (e.g. smoking) needs to be employed.
Just remember that people who really need care come to the US to get it if they can. We are the innovators and lead the world in drug discovery and development despite the many headwinds.
The answer needs to maintain those benefits while sorting out the issues of access and cost. The government will never do that. The goal of the politicians who promote socialized medicine is not public health. It is to create public dependency on government in order to entrench themselves in power. You don’t bite the hand that feeds you. Do you? I’d rather trust market forces.
Andy,
I’m totally with you about the left losing its way when it embraced ethnic and racial identity politics.
Barry,
I doubt Edwards would require regular mammograms. I think he means that he would require insurance companies to offer regular mammograms as a benefit. If not, that would be a real non-starter.
I’m with you on him being no FDR. By all accounts he’s a bit of a lightweight, and he clearly squandered his single term in the Senate trying to position himself for higher office instead of working his butt off and showing how a Democrat can win reelection to the Senate in the South. What I admire him for is putting together a good policy package for 2008 and delivering it with passion. The messanger remains flawed, but the message is pretty damn good, from my perspective.
I don’t get your comment on his lifestyle. He’s your typical successful nouveau riche guy with a lot of disposable income. Such people are naturally going to consume more. If you’re a communist, you have a problem with this. If you’re a liberal or social democrat (the term I prefer), you don’t. The proper social democratic attitude towards the rich is to collect their taxes and wish them well.
One more time. The problem ISN’T with Edwards’ lifestyle (out of context). It’s with his conservation is good for thee not for me contradiction. I wish him well with his big house, but then don’t preach to me about conserving. It’s like consuming a kazillion barrels of oil in order to play at a rock concert where the message to the poor unwashed masses is, “stop consuming” so we can buy carbon credits. It’s deeply unserious. Again, if he doesn’t understand how bad this looks, he will “richly” deserve the pounding he will get. And at least he will have a nice place to fall back on.
If he doesn’t mean the women would be required to have mammograms when he says the women would be required to have mammograms, perhaps there will be a new book on the Edwards Dyslexicon. Yes, he will be forced to stand down from those kind of remarks and say, “oh that’s not what I meant”. But if he’s such a smart policy nerd, we can’t blame that kind of comment on his being a country stumble-bum. I think he means it. The other option (always possible) is that he was misquoted.
The US spends 15-16% of GNP on health care today. Single payer advocates tell us that we can get that number down to 10%.
Of that 15-16%, about half is spent by govt (govt employees, medicare, and state equivs), to cover a little less than half of the population. Let’s call it 7% and 50%.
Hitting the single-payer advocates’ target of 10% GNP to cover 100% of the population means doubling the number of people covered for less than 50% more money. I don’t see how.
Clearly that can’t happen unless govt healthcare spending becomes significantly more effective, the quality of care goes down, or the “other” half don’t get as much money spent on them.
If “becomes significantly more effective” is the answer, why not prove that point by making the relevant changes now? At the same time, let’s open up the govt system to voluntary participation (at marginal cost). If govt healthcare really is/becomes more cost effective, lots of folks (and companies) will chose it.
What? Govt healthcare can’t be fixed without giving it a monopoly? How can that be?
The first thing I want to see the government do is deal with the major cost factors that are NON-medical. If they can deal with that, we’ll talk about the rest.
The bureaucratic, regulatory and liability mess needs to fixed to start with. Rather than people being forced into a government health insurance scheme, let’s see the doctors have government malpractice insurance so, like their Swiss confreres, they don’t have to worry / pay for that.
Let’s see standardization for all insurance claims reporting so that dealing with health insurance isn’t as much of a professional expertise as tax law (another topic for another day)
What does all this have in common, and why won’t it be done? These types of reforms would impact the lawyers! And, since so many of our pols are lawyers, this will be next on their agenda behind tort reform…which is right behind a snowy hell…which is right behind the porcine air force.
All docs are employees of the healthcare delivery organization and there are no malpractice lawsuits.
That’s gotta be two-thirds of the system’s savings, right there.
Someone else commented on how insane malpractice insurance rates are. He’s right. A good friend of mine is an E.R. doc, and he once showed me the numbers on what he would have to pay for malpractice insurance if he was buying it on his own. (As it is, the hospital he was working for covered the insurance). I think it was something like five figures — it was certainly crazy.
And now John Edwards, who used to sue doctors and hospitals for malpractice, is talking about the high price of medical care in America. Anyone see anything wrong with this picture?
I should have put that first paragraph in quotes to make it plain that I was quoting. Specifically, quoting the email about the Swiss healthcare system.
Roger, re valjean (is that jean?) and the 50 million, and in fact, the 15% of GDP:
Beware the stats; they’re spun. We spend more on breast implants teeth-bleaching, and other cosmetics than other countries, so you could spin it the other way “We’re rich enough to spend more than anybody else.” Also, of the 50 million, many millions of them are young, healthy, prosperous, and merely betting that it’s cheaper to pay for the doc visits than to buy insurance. I know I spent VERY little on health between age 20 and 40. Another 12 million of them are illegal aliens, and another 6-8 million are eligible for free programs they haven’t signed up for. The true number of “unjustly” uninsured is probably less than half the figure bandied about (and I’m not going to argue about “unjustly”, I’m using the term very loosely).
Not that our system is totally fantastic, or the Swiss isn’t somehow better, just this little quibble about low-hanging stats used for campaign slogans.
Sam_S,
It’s jean as in “jahn” … and thanks for the good points. I still think there’s room to make health care and insurance more affordable by removing horrid incentives and getting back to consumer pricing. Yes, the GDP stats are no doubt overblown — but that doesn’t mean costs aren’t going up faster than they should in a more rational system.