Insight, analysis & opinion from Joe Paduda

< Back to Home

Jul
17

Universal coverage is bad – Part Six

Perhaps the most puzzling condemnation of universal coverage is the contention that “A mandate is not necessary as the free market will solve the problem”.
Proponents of the free market argue that the problem is today’s market is not “free”, but rather over-regulated. And once we completely de-regulate the insurance market, the Invisible Hand will produce products and services that will provide coverage for a lot more folks.


These folks conflate regulation with universal coverage.
The health insurance ‘market’ in the US is considerably less regulated than in, say Switzerland or Germany or Japan, where everyone is forced to have coverage. And all those countries have lower medical costs and provide coverage for everyone.
And customer satisfaction is higher too – “65% of French citizens express satisfaction with their system, compared with 40% of U.S. residents”
Based on that (admittedly very simplistic) rationale, it appears that the more regulation there is, the lower the costs and more folks covered.
I’d suggest that a solution that has lower costs and covers everyone with high customer satisfaction rates is better than one with higher costs and does not cover 15% of the population. We can argue waiting times and life expectancy and breast cancer screening rates, but the net is rather simple.
What am I missing here?


2 thoughts on “Universal coverage is bad – Part Six”

  1. I would still like to see some good data regarding the percentage of GDP and/or of total healthcare costs that is spent on the 65 and over population in the U.S. vs elsewhere. I’m told that approximately 50% of healthcare costs in the U.S. are attributable to the elderly including payments by Medicare, Medicaid (mostly for long term care), private Medi-Gap insurers, long term care insurers and out-of-pocket payments by beneficiaries. Yet, Medicare is already a (largely) taxpayer funded single payer system that provides universal coverage for its served population. Its high costs probably have a lot to do with its inability or unwillingness to say no and its willingness to tolerate huge regional differences in practice patterns (Miami vs Minneapolis) with no difference in outcomes. Why should taxpayers think that Medicare’s unwillingness to provide any leadership on these issues would suddenly change if it were suddenly put in charge of the whole system? The approach to end of life care is very different and less costly in other countries, and we could learn a lot from them if we were so inclined.
    As for customer satisfaction, I suspect that the differences have more to do with expectations and what the society considers fair and reasonable (especially with respect to end of life care) than with the actual quality of care or its availability and timeliness.
    Even if we ultimately move to taxpayer funded health insurance financing and we achieve universal coverage, costs will continue to spiral out of control until policymakers learn how to say no to new drugs and devices that are not cost-effective or are no better than existing, less costly alternatives. We will have to put some sensible limits on how much we are willing to spend on ultra expensive biologics for late stage cancer patients. Finally, at the end of life, we need to put more emphasis on palliative care or hospice care and less on mindless interventions just because we have the technical capability to do them.

  2. Joe – I agree with your post. The health insurance and health care markets are completely out of whack.
    We need more regulation, not less. Who wants healthcare plans full of loopholes and exclusions that shady insurers and their attorneys can use to deny coverage? We have too much of that already.

Comments are closed.

Joe Paduda is the principal of Health Strategy Associates

SUBSCRIBE BY EMAIL


 

SEARCH THIS SITE

A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.

 

DISCLAIMER

© Joe Paduda 2019. We encourage links to any material on this page. Fair use excerpts of material written by Joe Paduda may be used with attribution to Joe Paduda, Managed Care Matters.

Note: Some material on this page may be excerpted from other sources. In such cases, copyright is retained by the respective authors of those sources.

ARCHIVES

Archives