The Shotgun Blog
Tuesday, January 13, 2009
Universal health insurance: A disaster in Canada, disastrous in Massachusetts
U.S. president-elect Barack Obama has hinted that he'll move in the direction of universal health insurance, much like the system we schleps have in Canada. The system that is unconstitutional in Quebec, and soon to be found unconstitutional across Canada if we dig deep in our pockets and throw the Canadian Constitution Foundation some money (please do).
But before Obama jumps headlong into this disaster, he should take a much closer look at how wonderfully it functions in Canada (it doesn't, not in comparison), or how it "functions" much closer to his home in Massachusetts. Apparently, the jury is in, and the results are pretty awful.
The DC Examiner has a lovely editorial on the subject, with this gem of a line:
If this sounds just like Canadian-style socialized medicine, that’s because it is. Massachusetts residents now pay more for less access to health care, yet their state still has an uninsured problem!
And here's some of the evidence:
Just a year after the universal coverage law passed, The New York Times reported, state insurers were already jacking up rates to twice the national average. According to Dr. Paul Hsieh, a physician and founding member of Freedom and Individual Rights in Medicine, 43 mandatory benefits — including those that many people did not want or need, such as invitro fertilization — raised the costs of coverage for Massachusetts residents by as much as 56 percent, depending upon an individual’s income status. So much for “affordable” health care.
Read the whole (short) piece, and remind yourself how socialized medicine works. It works just like socialized anything. It doesn't.
Let me say that I am opposed to Canada's system of trying to deny people to use their own money as they wish, as in purchase their own healthcare.
But on the other hand, I think the calls for a completely market-driven healthcare system are somewhat hard for me to swallow.
In a market system, even people reasonably well off will find themselves unable to get affordable insurance for healthcare. People who had had, or had cancer. People with chronic illnesses, etc.
Having lived in the US for about 7 years of my life, there's also one thing I've learned about health insurance in the US. And I have some first-hand accounts of this: being insured does not ensure you'll get healthcare. At most it ensures you have a right to bring a lawsuit.
The amount of litigation against health insurance companies in the United States by insured individuals is actually staggering.
So when us libertarians simply say when it comes to healthcare: it's the individual's responsibility to get insurance, it leaves me a little numb.
And I say this because, a female friend, Sonya, in the United States makes about $70,000/year, has Multiple Sclerosis, and is about $300,000 in debt because of it. Even at her salary, no insurance company will touch her.
While one might say the US has much better healthcare than Canada (and I would tend to agree), that statement should really be for "those who can afford it".
Sonya's financial turmoil is catching up with her, and the ability for her to service the mounting debts associated with care is reaching a precipice.
She was the daughter of the unfortunate circumstance of developing MS when she was very young, at a time when her parents had not insured her. Developing any kind of chronic disease in the US while your "between insurance companies" is pretty much a death knell.
In the free market sense, there really is no solution. If we are going to be hard core, we really do have to say: "Sorry, Sonya... unless you can find someone's charity. You're on you're own."
Posted by: Mike Brock | 2009-01-13 12:09:57 PM
I would add, that the esoteric nature of healthcare, makes it difficult to put it on the same level as other commodities like housing and food; it's not something that can be easily, since the technology is very esoteric, highly patented, and not something that seems to become more affordable through competition.
Medical science is advancing faster than the market can commodities the technology. Medical patents also re-enforce this, placing high premiums on bleeding-edge medicine, which everyone wants.
For this reason, insurance companies cannot provide affordable coverage that covers everybody. Much of their profit margin relies on denying claims by necessity of the upward price pressures on the market for said reason.
My question is really: is there a compromise on this issue. And by that I mean two-tier healthcare.
Posted by: Mike Brock | 2009-01-13 12:14:39 PM
Sorry for triple-post... but I guess what I'm saying is:
I'm trying to be as un-ideological as possible, and I've heard a lot of counter-arguments to these questions. Particularly that is government de-regulated medicine, it wouldn't be so expensive, etc. Even if that were true, I'm not sure that would account for edge-cases such as the one I have described.
These are edge-cases where lack of personal responsibility was not a factor in the outcome. Where, insured people find themselves de-insured on technicalities, an uninsured children who develop chronic illnesses will never be able to achieve coverage for lack of their parents responsibility. To me, saying "deregulate, and these problems will go away" is like saying "socialism just hasn't been done right yet".
Posted by: Mike Brock | 2009-01-13 12:26:38 PM
I just want to make it clear that the U.S. is not a free market health care system. Not even close. The U.S. government spends about half of the total money spent on health care in the U.S. (think Medicare, Medicaid, programs for children, etc.)
The comparison shouldn't be between Canada and the U.S. We should compare our system and the U.S. system with some of the mixed models in Europe. In particular, France, Portugal and Germany (and Greece, I think). They have mixed systems that consistently rank the best world-wide on the World Health Organization rankings. The U.S. system is way behind, and the Canadian system is way behind the U.S.
As you pointed out, the U.S. system also presents a problem because of the culture of litigation here (I'm living in the U.S. at the moment).
Posted by: P.M. Jaworski | 2009-01-13 12:35:32 PM
Most Canadians are worried about thier health care system, but we read about horror stories in the States about people being denied health care and think no way can we let that happen here. A two tired system might give us the best of both worlds, basic health care for everyone at a reasonalbe price, and access to more services if you are willing to pay. In Canada we get what I call the used honda accord of health care. It is a good price and gets you around but it does not suit everyone's needs. We have to wait for services and it can be difficult to find a doctor. In the United States you can get brand new cadilac of health care. No lineups and all the treatment you want. However it is so expensive that it is difficult to afford. A two tiered system would ensure that every one has access to basic care (the used honda) but if people want to pay more through private insurance for additional coverage (the cadilac) they have the ability to do so.
Posted by: Michelle | 2009-01-13 12:58:24 PM
Agreed on both fronts. I believe we should be looking at the mixed-market solutions of Europe. There seems to be a false dichotomy between US-style healthcare and Canadian-style healthcare.
It would be helpful to the debate if people on both sides of the issue came at it from a un-ideological perspective and honestly look at all the problems that we face in a socialized healthcare system, and all the problems that we've seen in more open-market healthcare and discuss them openly.
I don't think that either system has been a "failure" per se, but rather have been systems I'd rank as "barely adequate".
Posted by: Mike Brock | 2009-01-13 1:55:40 PM
"We should compare our system and the U.S. system with some of the mixed models in Europe..."
Peter, Where has the libertarian gone? A mixed model? How Tony Blairish!
Mike Brock's example of Sonya is a good one and her unfortunate predicament may eventually boil down to two alternatives(ignoring bankruptcy and state assistance), either the taxpayers fund her care or a private institution does such as charity, co-op, foundation etc. Libertarians must ideologically choose the later. One might advocate for an interim parallel private system in Canada but would have to hide behind the Conservative label (try pot legalization with those guys!!).
The other reality of the US health care system (I also live in the US although unrelated to the following), is that access is abundant and goes undenied to those who show up at most hospitals. It's just not free (ignoring Medicaid mandated for illegals and the poor). Having lived through choosing to wait my turn in the fetal position for six months or so for a neurosurgical consult and surgery in Canada and face bankruptcy, incontinence, and loss of mobility or go the the US and pay for surgery, I chose the later. There are worse things then being broke. The US system could stand market-based reform, litigation-free islands, dropping state mandates and inter-state insurance barriers etc but even an uninsured American still has better access to health care than any Canadian that hasn't jumped queues through "connections" or gone to the US.
Posted by: John Chittick | 2009-01-13 5:13:15 PM
If you think health care is expensive now, wait'll you see what it costs when its free...
Posted by: JC | 2009-01-13 5:32:52 PM
Please don't misunderstand my meaning, John. Of course I think a totally free market health care system would work best. But we don't, yet, have the empirical evidence available to us to make the case to those who think, mistakenly, that the U.S. is an example of a free market system, or who are hesitant about applying the principles and evidence that we have from, say, telephone service, supermarkets, diapers, cheese, cologne, clothes, etc., etc., etc. to health care (some people insist that health care is special, and, for some reason, think it wouldn't work like the buying and selling of widgets).
So the comparison to the mixed systems is appropriate in this context.
Posted by: P.M. Jaworski | 2009-01-13 5:40:26 PM
"Socialized Medicine" is primarily an ideology championed by the Democrats. However, contrary to popular belief, a nationalized health care system for all American's has never actually been on the agenda for President Elect Obama. http://healthpolicyandmarket.blogspot.com/2008/03/detailed-analysis-of-barack-obamas.html His agenda instead has always been to assist those who are rendered uninsurable and or are in need of assistance in obtaining health care coverage due to low income.
Part of his plan is to expand the role of SCHIP and State Insurance Risk Pools so that those who are rendered "uninsurable" on the individual major medical market have guaranteed insurability through their respective State Risk Pools. Many states already have this option. However states such as Arizona and Florida do not. These states desperately need such Risk Pools. Unfortunately, until now they have not been able to receive enough Federal funding to expand this much needed role. States that do have risk pools are listed here: http://www.naschip.org/states_pools.htm
President Elect Obama wishes to provide more Federal funding to these existing risk pools to drive the premiums down, thereby making this option more affordable for those rendered uninsurable.
One of the reasons that a "nationalized" health care system has never been on Obama's agenda is most likely due to the terrible failure of such programs in countries such as Canada. A common example used to further the cause of "socialized medicine" in the United States is to point out how well it is working in Canada. However, those living in Canada know full well that their government run health care program is most certainly not working.
As a matter of fact, many Canadian citizens choose to hire high priced brokers to find them quality health care right here in the United States because of the terrible bureaucracy that controls all forms of health care in Canada. For more about what is really going on with the Canadian health care system please watch these short but very informative documentary videos:
The number of actual uninsureds in the US has been grossly inflated as well. For the real numbers watch: http://www.freemarketcure.com/uninsuredinamerica.php
The truth of the matter is we already have an enormous amount of entitlement programs available to those who find themselves unable to pay for their health care. Often times these entitlement programs are offered to those who are here legally and illegally as was the case in the State of Illinois: http://www.sbisvcs.com/healthinsuranceblog.htm
Most recently, the State of Hawaii tried to emulate the Medicaid Expansion programs that were enacted in Illinois. It took less than 7 months to render their program bankrupt: http://www.breitbart.com/article.php?id=D93SBEUG0&show_article=1
All things considered, the best way to offset the high cost of health care in the US is to adopt the initiatives set forth over a decade ago by Senator Bill Archer (R) of Texas. The Health Savings Account (commonly referred to as a "Medical IRA") is a unique option that maintains high quality health insurance coverage for the policy holder whilst also building a tax deductible, tax deferred interest bearing account for the insured to use for future medical expenses. Even if these expenses would not normally be covered by the policy holder's health insurance plan. For more about the "intelligent health insurance choice" (HSA qualified HDHP's) please click here: http://www.sbisvcs.com/HSA%20&%20HDHP.html
In the end consumer education and retention of existing Federal entitlement programs (via a legitimate needs assessment test) will go a long way towards not only maintaining our current health care system, but also towards keeping the bulk of our nations risk where it belongs namely, with the private health insurance sector. In light of the recent $7 Trillion "Bail Out" and many other failing corporations coming to the table with their hats in their hands (and their private jets on the tarmac) the last thing our government should do is start cutting more blind "bail out" checks in an effort to "reform" the U.S. health care system
Posted by: C. Steven Tucker | 2009-01-13 6:43:38 PM
Without trying to beat a dead horse on this, utilitarian arguments are trumped by moral ones when it comes to libertarian principles. That no market mechanism guarantees a satisfactory outcome for the exceptional case in health care does not excuse the use of force in attempting to do so via socialism. Your reply to the uncomfortable dilemma reminds me of the interventionist economists hiding behind econometrics to obfuscate what is clear using praxeology.
In trying to sell the idea of charity as a substitute for an (state-run) institutional safety net one should not find opposition from most Christians as they are somewhat bound to altruism (moral only to the degree that it has been done through free will). The problem arises when confronting the secular left who generally distrust mankind and prefer coercion or the odd Randroid whose strict interpretation of altruism is always negative.
Posted by: John Chittick | 2009-01-14 12:07:15 PM
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