John Edwards’ proposal would require businesses and other employers to either cover their employees or help finance their health insurance, yet he also says that businesses and other employers “will find it cheaper and easier to insure their workers.” Is this plausible?

Pauly: An employer currently not paying workers in the form of health insurance might find insurance cheaper under Edwards’ plan, but it will still cost a lot. Why vote for someone who will lower the cost of something you do not want to buy? Of course, employers are all confused because they think the cost of coverage will come out of their profits, when in fact it will come out of their workers’ future raises. I do not know why we insured workers should favor proposals that will reduce the wages of currently uninsured workers; as I said before, I would prefer to finance insurance subsidies targeted to lower-income families by broad-based income taxes.

Rosoff: I think it is plausible. You have to take each statement in its appropriate context. If you do they can both be right, but they can’t both apply to all employers across the board. For example, if you have a small employer who now doesn’t attempt to provide health insurance for its workers because it’s too expensive, it’s not going to be “cheaper” for that employer to now start covering the workers. However, if you structure new insurance pools so that small employers can get health-insurance rates approximating those for large employer groups, those employers will find it “easier and cheaper” to insure their workers than they otherwise would.

 

Fred Thompson said recently that “the poorest Americans are getting far better service” than Canadians or the Brits. True or false?

Asch: False.

Pauly: They probably are if they are really sick and get to a good hospital; they probably aren’t if they are reasonably well and seeking preventive or routine care.

Mitt Romney, who would “like to see every state do their best to get everybody insured” by private insurers, says that a Democratic health-care plan would result in “socialized medicine,” and that if we go down that road, we’ll end up with the “consequences of Europe,” including a stagnant economy and higher unemployment. Please comment.

Asch: When was the last time you bought some Euros with U.S. dollars? It’s not pretty.

Pauly: It is true that if we would shift the $800 billion of now-private spending to the government and pay for it by adding it onto a progressive tax structure, there would be a large jump in tax-induced distortions and waste for the economy as a whole. The Germans are moving in our direction by lowering the tax-financed part and the French may well go that way under Sarkozy.

 

Hillary Clinton’s health-care proposal, which started out as an “agenda to lower health-care costs and improve value for all Americans,” has evolved into a pretty specific plan. How feasible is it?

Asch: Senator Clinton’s plans have become increasingly more specific since the summer. She has emphasized the goals of universal coverage, portability, affordability, choice. She wants to use the Federal Employee Health Benefit Program as a model—something many have urged for years. She says she will lower costs through modernization and an emphasis on prevention—good things, of course, but not ones that seem likely to lower costs. I think there may be huge gains from eliminating waste, but I just don’t think we’re at the point on the curve where higher quality is going to lower costs. The financial support for her plan might come from rolling back Bush tax cuts and making the employer health-care tax-deduction less generous, certainly for those with higher incomes.

No specific plan is going to survive an election intact anyway. The important and potentially enduring distinctions among candidates are at the level of principle, not detail: How much is government and how much is free market? Is universal coverage a priority, or just a hope? And finally, is it really change, or is it just business as usual?

Rosoff: As the Harry and Louise ads showed, people in the U.S. who have health-care insurance will resist change if they fear it will make their situation worse. Their fear: If the current system is already plagued with cost and quality problems, how much worse might those problems be if we stretch the system to include another 45-plus million people. In other words, the “haves” don’t want to be worse off as a result of doing what, in the abstract, they would agree should be done to make the “have-nots” better off.

Some would say that shows selfishness and a lack of cultural solidarity among the American populace. Perhaps they are right. Those nations that have gone down the path to universal health care have displayed a culture of solidarity well beyond that which the U.S. has demonstrated. As a people, are we capable of rising to that level of solidarity? That is a key question. Clearly it would take a strong leader, a persuasive champion, to awaken that sense of shared destiny in us.

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