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January 09, 2008Reich to Dems: 97% Coverage is Good EnoughCheck out Robert Reich's Journal op-ed today, The Road to Universal Coverage, which argues that the debate amongst the "Big Three" Democratic presidential candidates (Clinton, Obama, Edwards) over health insurance mandates is a distraction. In almost every important respect, all major Democratic plans are the same. They require employers to "play or pay" -- either provide coverage to their employees or contribute to the cost of coverage. They create purchasing pools that will offer insurance to anyone who doesn't get it from an employer. The plans preserve freedom of choice of doctors. They aim to save money through more preventive care, better management of chronic disease, and standardized information technology. All of them subsidize lower-income families. ... As a practical matter, the difference between Sen. Clinton's and Sen. Obama's approaches come down to timing and sequencing. Mrs. Clinton wants a mandate first, believing that enrolling the younger and healthier will help reduce costs for everyone else. Mr. Obama thinks forcing people to buy health insurance before it's affordable isn't realistic. He wants to lower health costs first, and is willing to consider a mandate only if necessary. This fight is little more than a distraction, given that a mandate would matter only to a tiny portion of Americans. All major Democratic candidates and virtually all experts agree that the combination of purchasing pools, subsidies, easy enrollment and mandatory coverage of children will cover a large majority of those who currently lack insurance -- even without a mandate that adults purchase it. A big chunk of the remainder are undocumented immigrants, who aren't covered by any of the plans. Who's left? Only around 3% of the population. So the question they're really battling over is whether it's better to require this 3% to buy insurance, or lure them into buying it with low rates and subsidies. He also cites research from Health Affairs finding that mandates might not be all that effective anyway, since "Switzerland now enjoys near-universal coverage, but this reflects only a tiny increase over the rate of coverage before it was mandated, when over 98% of population had mostly voluntary coverage." Now, I have my criticisms of the Dems health care plans, but besides offering thoughtful advice to Democrats he lays out an implicit challenge to supporters of a free market or consumer driven alternative: how can we design a voluntary, market-based system that will achieve affordable coverage for the vast majority of Americans and yet still encourage high levels of innovation? Hopefully this challenge will be answered soon.
Posted by Paul Howard at January 9, 2008 11:24 AM CommentsPost a comment |
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