Obviously there is a lot of talk in the media about health care coverage for every American; with the basic premise being “health insurance” for everyone. Is health insurance for everyone really the solution though? Knowing people who have personally experienced the horrors of universal coverage as residents of countries with such coverage, and being an advocate for free-market solutions, I can’t put my support behind that as the answer. I also cannot support a governmental “competitor” in the market. This will eventually lead to universal care as any “competitor” that can subsidize its losses with tax dollars can undercut everyone until they put them right out of business, thus resulting in a single-payer system. What if the solution to affordable health care was really the complete opposite direction we are all looking now? What if the solution to affordable health care for everyone, was insurance for no one?
I can almost hear the sound of people scratching their heads as they wonder how no insurance is a solution so allow me to explain. Rather than explore the history of how we came to our current state of health care and insurance (there are already plenty of people who have done that, just google it if you’re curious), We’re going to look at some of the possible outcomes if we fundamentally changed the way we deal with health insurance and health care.
First, a dramatic dose of deregulation would need to occur that would no longer require businesses to provide health insurance for employees (including governmental employees) who work over 40 hours a week (this varies state to state with some states requiring as little as 20 hrs). This would result in tremendous savings for businesses who would then be able to expand, hire more employees, and pay higher wages. We could probably put a significant dent in our currently growing unemployment numbers, as new businesses are started with the cost of starting a business being significantly lower than what it currently is.
You’re probably still wondering what lowering costs for businesses by eliminating health insurance has to do with keeping health care affordable. This is the part that health insurance companies aren’t going to like very much because their profits will drop significantly with so few people being covered. Because health insurance companies will no longer have their tens of millions of “guaranteed” customers who work over 40 hours a week, they will be forced to lower their prices to a level at which people can afford insurance, though many may still choose not to purchase it as the lower number of insured people would also likely affect the affordability of doctors offices and hospitals (a catastrophic health insurance may be all that many families need).
Because doctors offices and hospitals would not be able to count on the “guaranteed” insured either, they would be forced to lower their prices to a level the market can support as well. So, instead of a doctors visit costing $100-$150, it would be nearer to the cost of a higher end co-pay. Instead of an aspirin costing $50 during a hospital stay, it might only cost 50-cents. In order to make this workable though, there would also need to be a significant amount of tort reform to keep fraudulent lawsuits out of courtrooms and malpractice insurance prices affordable for those in the health care industry.
The problem with the current plans that are being presented is that they try to control the cost of insurance instead of allowing the market to control the cost of care. Affordable health insurance isn’t really the answer (though I think this would bring that about as well). Unless we deregulate and allow the market to control the cost of health services, we will continue to see prices rise uncontrollably.
(I would be most appreciative of any feedback on this proposed solution be it positive or negative. I know we will likely never see this because there is too powerful of an insurance lobby in Washington and “less is more” is not the way government operates these days.)
