What Is the Purpose of a Health Care System?

This is something of a follow up to “Why Is There an Economy?” The Center for American Progress has an alarming report on the number of Americans losing their health insurance every day. The rate of uninsured Americans is growing in every state, and most of the uninsured have jobs.

Matt Yglesias comments,

Right now, a person who develops a serious medical problem can continue to enjoy health insurance coverage if and only if he or she is able to maintain health insurance continuously. But if you lose your insurance because you get laid off, and then can’t find a new job for a while because of generally bad labor market conditions, then even though you’ll be able to get a new job when the economy revives, you’ll now find that your illness means you can’t get coverage for your medical problem. That’s totally rational business practice, but it completely defeats the purpose of a health care system which is precisely to ensure that sick people can get health care.

If you pay close attention to right-wing arguments against national health care, you notice the underlying assumption: The purpose of a health care system is to support a profitable health care industry. For example, regulations that mandate insurance companies insure people with pre-existing conditions are bad, because they are bad for business.

On the other hand, if your underlying assumption is that the purpose of a health care system is to provide health care to people who need it, you must be a liberal.

I did a news google looking for a right-wing argument against national health care, and this is the first one that came up. It’s not as strident as many. It does begin with the straw-man assumption that people who want a national health care system expect it to be free. I have never met anyone who thought that.

The author also falls back on the assumption that “government bureaucracies” always are more expensive and inefficient than private enterprise. But the American health care “system” already is the most inefficient on the planet. We spend much more on health care per capita than any other nation and get poorer results.

In any event, the argument that government bureaucracies always are more inefficient than private enterprise simply is not supported by facts. Any large organization, whether a business or a government, can be run well or poorly. It’s true that consumer products companies work at being cost effective in order to survive. But notice a lot of them aren’t exactly surviving these days.

And as I’ve pointed out elsewhere, the laws of supply and demand do not apply to health care in the same way that they apply to mp3 players. People don’t shop for health care in the same way they shop for toasters. If you want to buy a toaster, you go to a retail store and pick out the nicest one you can afford. This provides an incentive to toaster manufacturers to make better toasters that cost less. However, with health care, it’s more like you buy a membership in the retail store — your health insurer — and the store decides what toaster you can have, and even whether you will get a toaster at all.

The author of the anti-national health care article writes,

Advocates of national health insurance argue that preventive care is cheaper than trying to care for patients who have become seriously ill. This is true, but preventive care is more expensive than no care – which is what uninsured people usually choose. If we adopt universal health insurance, people who normally do not go to the doctor will go, and some one will have to pay for that care.

Kind of stunning, yes?

Social security insurance and Medicare have worked to provide more money and better health care for the elderly. But as a consequence old people live longer, collect more social security, and need more Medicare. Both programs have become vastly more expensive than was originally projected.

See, if we could just let more people die younger, it wouldn’t be such a strain on the system.

The author then brings up the awful specter of rationing health care, without noticing we are already rationing health care — if you don’t have insurance, you don’t get health care.

The author is correct that one reason health care is more expensive than it was many years ago is that medical science has developed new technologies and therapies that are excellent, but expensive. A century ago, if you broke your leg, the doctor would diagnose this by feeling your leg. Then we went to X-rays. Now there are MRIs. Very expensive stuff. But for that very reason, the old system of letting people pay the doctor however they could doesn’t work any more. And the more recent system of providing health insurance through employment is breaking down, also.

The author doesn’t bring up right-wing arguments against so incremental a step as a public insurance program that might compete with private insurance. Such a public program might be able to provide lower cost insurance by widely pooling risk and through subsidies. And that’s not fair to private insurance companies. See, it’s better to let millions of Americans go without decent health care than to not be fair to private insurance companies. As I said, to the Right, the purpose of a health care system is to support a profitable health care industry.

There’s nothing wrong with profits, and those nations that have the best health care systems as measured by cost per capita and results tend to have mixed public and private systems. It’s not just the government pulling the whole load; there is still a place for private enterprise. But those nations with the most cost-effective health care systems have the crazy idea that the purpose of a health care system is to provide health care. Radical.

24 thoughts on “What Is the Purpose of a Health Care System?

  1. I have followed the U.S. health care debate for decades. I can’t understand why Americans don’t look to their friend and neighbor to the north as an example. As a Canadian I have extensive health care coverage. So does the family next door, the guy that fixes my car, the guy that picks up my trash, the women who was my doctor, for twenty years, the guy that is my doctor now and every one who lives here. Is it free? No we pay for it collectively through our taxes. Is the Canadian health care system perfect? No but it is pretty damn good. Canadians statistically live longer and it’s not from our weather. Health care is far cheaper per capita in Canada. Personal bankruptcy over medical costs is not an issue here. I can and have chosen my own doctors. Doctors have their own private practices. The vast majority of Canadians look at our system with pride. If that makes us slightly more socialist than Americans so be it.

  2. Because, Bruce, many Americans honestly believe that Canadians are dropping dead while waiting in line for health care, and that Canadians have to drive across the border to see a doctor because they have to wait too long in Canada. I’m serious.

  3. Oh yea, maha. Too true. I hear this all the time from the right. “The U.S. has the best darn health care in the world!” (not true) “People from all over the world come here for health care!” (provided they can afford it or it’s donated) “Canadians have to wait for months to be seen for a heart attack!” (ridiculously untrue)

    I like to point out that the “best darn health care in the world” isn’t worth much if you have no health insurance and are left standing on the sidewalk with your face pressed against the windows at Mayo.

  4. There is a place for private health care to be offered with more options and customer service than the public plan may offer, at a higher cost. Under the proposals that have been circulating there will be ample opportunity for private companies to make money. Those who choose the public option may get the better deal, but nobody is being forced to change their current coverage if they are happy with it. I don’t see how this is even a debate.

  5. Frankly, I have quit listening to the right-wing nay-sayers – on health care or anything else that Dems are proposing that might benefit anybody except the very rich.

    Recent outrageous remarks bear repeating: Obama listed the quality of empathy as one he would look for in a possible replacement for Souter: A Repub senator noted that ’empathy’ is a “code word” for an “activist judge” – so can we assume that empathy, according to a Repub, is a negative quality in a human being?

    And this one from a rightie is REALLY out there: If Pell grants become entitlements, as Obama is proposing, it won’t be too far in the future when anyone who was granted one under the suggested program will be REQUIRED TO VOTE DEMOCRATIC. (I’m not making it up.)

    The arguments against universal health care can best be described – if not ludicrous – as specious, plausible but invalid, having only the appearance of the truth. Every nay sayer’s argument is and will be specious and can only be effectively challenged according to its speciousness.

  6. There were and are sometimes delays. This is not for emergency services. That has vastly improved over the years. No system is perfect and perhaps the U.S. could create a better one. Canada has very good free press and Canadians have a low tolerance for social injustice. If people were dropping dead in line ups there would be a huge outcry. HMOs if you can afford one cause far more delays and obstacles than we have in Canada. Besides social justice there are economic benefits for a country to have a public health care plan. There are more automobiles produced in Ontario then in Michigan. This is because the price of doing business goes down when the cost of health coverage for employees is stabilized.

  7. Personally, I favor a 100% government-administered health care system. Insurance companies can stick to life and auto insurance. For those companies that are “hurt” by such a policy, the government can offer their workers retraining programs to learn a trade more beneficial to society as a whole.

  8. Private enterprise is the best way to deliver something if that something is something you can walk away from and not get. Private business are the best way to sell toasters because if no one offers you a good toaster at an affordable price you can simply say “Well, I guess I’m not buying a toaster today” and walk out.

    You can’t say that about health care; you can’t say that about education; you can’t say that about electricity or heating oil; you can’t say that about pensions; you can’t say that about a lot of things. Health insurers have the perfect situation: They have something people absolutely need, and they get to administer it on a profit-motivated basis. So the money rolls in, and they pay Congress to make sure it stays that way.

    The oil companies thought they were in the same situation, but when gas hit $4-$5 a gallon, people found ways not to use it. I’ll reluctantly believe that the increase in price was due to supply costs (though they never explained why profits went up when costs supposedly did too), but I am sure that if they thought they could get away with still charging $4-$5 a gallon when supply eased and costs dropped, they would.

  9. You know, this is something that was pointed out to me a while ago. Insurance is one of those things that shouldn’t be run as a business under the profit motive.

    It used to be that insurance companies were like, “we want to give out every penny that we get in premiums. We just want use of that money between the time the premiums are paid and the time we pay them out.”

    Over the course of 20 years, they might take in 20 billion in premiums, pay out 20 billion in claims, and the earnings on that 20 billion pay salaries and administrative costs (and maybe return a modest profit to the investors).

    But now, maximizing profit is considered a good thing in and of itself. So, denying, or delaying, a claim is considered good, in and of itself, so long as it’s not a blatant violation of contract. (And even if it is, so long as it doesn’t look so egregious that a judge will be ticked off.)

    That it’s “a sound business decision” is considered sufficient to render it moral in the minds of many.

    Many of those people would swear they are good Christians, but they seem to forget that Jesus said you can’t worship both God and money.

  10. The author also falls back on the assumption that “government bureaucracies” always are more expensive and inefficient than private enterprise.

    …and out of the other side of their mouths, they say that a government-run program will put private insurers out of business because government can offer it at lower cost. I’ve seen that in writing many times over the past several weeks.

    In other words, say anything, it doesn’t matter what and it doesn’t have to make sense in the rational world, as long as you oppose health care reform.

  11. Bruce, didn’t Canada’s national health care system only come about when the nation realized that medical care should not be considered a profit-making commodity? (OK, I’m getting that from a dimly-remembered movie about Norman Bethune starring Donald Sutherland, but my visits to Canada seem to reinforce that basic conceptual divide between your country and mine.)

    The problem is, we Americans need to differently understand the concept of medical care. Now, I’m not exactly Michael Moore’s biggest fan, but when his film Sicko was released, he said something to Oprah that really stuck with me: we need to see medical care the same way we see public schools, public libraries, police and fire services. Medical care is necessary for a long and healthy life, as are the other types of security and enrichment that we’re already accustomed to supporting with tax dollars. Furthermore, maha is correct that no one actually expects national health care to be free. Public schools are no longer “free,” now that students like my middle-school niece come home every semester with a list of fees her parents must pay. Cities, towns and counties charge for ambulance service. Rural VFDs will send you a bill after dousing the fire in your kitchen or implement shed. When it comes to universal health care, I’d much rather my tax dollars were spent on a system that gives optimal health care to every American, with a private option for nonessential care, than have one more dime go to Halliburton Corp. or some other friend-of-Dick’s who is contractually destroying some forgotten corner of American life.

    Which reminds me: Walter Reed Medical Center. That’s the kind of care the Righties gave our veterans. Clearly they’re not capable of dealing with the issue, so it’s up to everyone else to work around them.

  12. Rick,

    Private enterprise is the best way to deliver something if that something is something you can walk away from and not get. Private business are the best way to sell toasters because if no one offers you a good toaster at an affordable price you can simply say “Well, I guess I’m not buying a toaster today” and walk out.

    I hadn’t thought of it that way before, but that’s a good point.

    The thing with health care is that most of us don’t comparison shop, and I suspect most of us only receive whatever treatments and tests our physicians think we ought to have. And if you’re sick or in pain, you don’t spend hours online doing comparison shopping for the best medical deal. You go to the first physician who will see you and who takes your insurance.

  13. joanr16
    1947 — The Saskatchewan Government, led by leader Tommy Douglas, introduces the first provincial hospital insurance program In Canada. Tommy Douglas was the grand father of Kiefer Sutherland (Jack Bauer) go figure.
    1966 it went federal.

  14. I have never understood the opposition to government health care by our elected officials. After all, they have government health care. As an example: John McCain. Has there been any significant period of his life when he did not have government health care? I take nothing away from his service to the country and the suffering he has endured. But I think his opposition to a single-payer system is odd, considering his use of one. If we had that same system for every American, we might hear as few complaints as we do from our elected officials.

  15. It’s hard for people to really grasp the Up-Is-Down world of Wingnuttia. They really do believe the purpose of a health care system (or any system for that matter) is to make money. Not to help sick people, or to enhance longevity, or even to be cheaper than the private insurance system. In Wingnut World all of these things automatically issue forth if the primary goal of making money is realized. And anything having to do with government is automatically Bad. It’s like a religion with them, they refuse to question or alter their assumptions. And God forbid if you ask them to contribute money to helping others – that’s the huge thing they cannot see as ever benefitting themselves.

  16. Moonbat,

    I actually think that not contributing money to helping anyone else is at the heart of the right-wing mindset. The really rich just don’t care about anyone else, but the average “Joe the Plumber” right-wing idiot has a conniption thinking that he might be contributing to the wellbeing of anyone but his kin (and even then, brothers-in-law are probably not included…). If bad times befall a right-winger, it’s a trial that God’s sent him. Bad times for anyone else are their own damn fault.

    The big difference between most Canadians and a sizeable number of Americans is the fact that we accept a minimum social safety net as normal. Yes, many Canadians kvetch about the undeserving poor, but they know that the minute they let politicians eliminate universal health care, THEY will suffer too. So, aside from a minority of local nutbars, the majority of Canadians will never let go of their healthcare system. And I say amen to that.

  17. I am not sure you can say that the Federal Health Care Benefits Program is single payer. As a retired Fed, we have a choice of a variety of health care providers. However, these providers have had to submit something comparable to a bid to OPM to be one of the providers; and, the least expensive for the most care will be chosen–along with other plans that are incrementally higher costs and more services. But, the one thing that most non-Feds don’t realize is that when a Federal employee makes a choice of a health care provider, the employee has to take into consideration all things other human beings take into consideration. Thus, I was a GS-5 at the beginning and I could not even think about opting for the best coverage. It was way too expensive. Only GS-14s and above could afford them. Consequently, my health care provider for most of my Federal career was Kaiser Permanente, which basically did serve those in the lower grades. The higher graded employess and most Congress people usually opt for Blue Cross/Blue Shield, high option. And, then, McCain has his military coverage, too. We also have a once a year period where we can change health care providers if our lives change in way that it becomes necessary; or, if you just hate the provider you just had.

    Going back to the rationing of our health care that already exists. I have said this before; but, our healthcare is rationed right now and has been since it became a for profit business:

    If you have a lot of money, you get a lot of health care.
    If you have a medium amount of money, you get a medium amount of health care.
    If you have a little bit of money, you get a little bit of health care.
    If you have no money, you get no preventive health care and only emergency health care if you are dying.

    Our system right now sucks big time from my point of view. I guess all the rightwingers who have blogs are too rich to have any knowledge, let alone experience in the sphere of fighting for health care.

    Also, health care should be inclusive, meaning including dental care, eye care, mental health care, etc. Last year a young boy about 12 died from a toothache. I know from my own experience that dental care is a whole different ballgame. I only go when I have a toothache. It is way too expensive in addition to the monthly payments to my health care provider. There are many Americans walking around with disease in their mouths that causes disease elsewhere in their bodies; but, dental care is often cost prohibitive. There is little thought about the importance of dental in this discussion about health care.

  18. …There are many Americans walking around with disease in their mouths that causes disease elsewhere in their bodies; but, dental care is often cost prohibitive.

    This is something that has only been discovered in recent years. And it’s also something that is easy to manage with home remedies. Most Americans are completely unaware of this, that their skungy mouth is increasing their chances of heart disease, for example.

  19. Moonbat. Dental disease is also a big co-factor with preterm birth – one of the reasons for our abominable infant/maternal mortality statistics. No one can be healthy with a mouth of caries and inflammation. Dental/vision/hearing and mental health have to be a part of a good health system.
    Also, I love the idea of ‘I can walk away from a toaster, but not health insurance.’ So true, and a great definition of what should be profit making and public service. One other thing. the opposite of socialized medicine is profit making medicine, not private medicine. Private delivery of health care can be socially funded or profit making. IT IS OUR CHOICE!!! Hopefully that is.

  20. … the underlying assumption: The purpose of a health care system is to support a profitable health care industry.

    And that’s why the GOP gave the insurance companies the prescription drug benefit. Paying out money each month for the elderly’ prescription drugs interfered with their cash flow model. It’s all about the private insurance company’s bottom line. But it’s not just healthcare insurance. In Florida insurance companies are allowed to cherry pick which homes they wish to insure. To keep their cash flow flowing in the right direction they don’t have to insure any home that may garner actual risk. There’s no actual sharing the load.

  21. Conservatives seem to think that we will be haggling and negotiating with our doctors about the cost of care, drugs, tests, etc. I’ve done this some with my doctor, and it is very difficult. The doctors don’t want to be bothered – they have other patients to see. And how many people really have the necessary knowledge to negotiate with a doctor?

  22. We need to start thinking more critically, and less ideologically. Focusing exclusively on a single-payer system confuses strategies with goals. Ignoring the mixed public-private systems that work all over Europe plays into the strategy of those who have no such confusion. THEIR goal is clear: protect the unregulated freedom of health insurance companies to ration coverage and care in order to maximize profits and executive compensation.

    In February, the Organization for Economic Cooperation and Development issued a report on the deficiencies of our current system, with detailed recommendations for reform. The OECD report focuses on issues that get too little attention from political interest groups or the media. This is a serious report and demands a serious read.

    Also, in July 2001, the Heritage Foundation issued a report on European health care systems that really surprised me. Predictably, the report was overly critical of the flaws of the European systems, especially, and also predictably, the French. But they also included reasonable “lessons learned”, and virtual endorsements of guaranteed, affordable coverage for all. Most surprising: all the European models Heritage discussed, except the Swiss, combine publicly guaranteed insurance with private supplemental insurance. And all the flaws are both marginal and correctable.

    Heritage has long been a dishonest ideology machine, but, on this occasion, they got a few things right that we can actually leverage for progressive goals.

  23. As a retired American I have been living in Spain for the past 5 years. Citizens here have a national health system that they have access to via clinics, hospitals, etc. They also have private insurance companies for those that want to purchase additional private coverage. The price of the private plans are about 1/3 the price of those in the U. S.

    Another notable difference is the price of drugs. I take 2 Glaucoma eye drops each day. The cost of the prescription in the U. S. was $180.00 for a month’s supply. Here the same medication (same drug manufacturer, name etc) is 40.00 Euros per month. For citizens that have access to the government system the price would be $16.00 per month.

    Why are drug prices across the line so expensive in the U. S.?

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