Posted by Liberty on December 10, 2008
“Not many people are buying cars built 60 years ago. No one is watching TV on a set manufactured in the 1940s. Patients are not lining up to see a doctor who hasn’t cracked a book since before the polio vaccine was discovered. Why, then, do millions of Americans get their health care through an employer-based system from the 1940s?
Employers didn’t start offering health benefits roughly 60 years ago because they were experts in medical decisions. It was a way of circumventing the World War II wage and price controls. Barred from offering higher salaries to attract workers, employers offered health insurance instead. Aided by an IRS ruling that said workers who received health benefits did not have to pay income taxes on them, and by the fact that employers could write off the cost of the health benefits as a business related expense, this accidental arrangement became the primary way most Americans access health care.”
So the government’s involvement helped create the health care situation that we have now? Why am I not surprised?
“…the employer-based system is inefficient. Each employer purchases health insurance separately. According to a recent estimate by the McKinsey Global Institute, this adds more than $75 billion in underwriting, marketing, sales, billing and other administrative costs that offer no health benefits. More than half of all American employers who offer health-care benefits don’t offer their employees a choice. Consequently, most Americans don’t have the option of giving their business to insurance companies that treat them well and only cover what they need. This prevents the usual market forces from holding down costs.”
This is thought-provoking, in the least. I’m a little skeptical about their conclusion that state or regional insurance exchanges are necessary (you’ll have to read the article) but this article definitely makes the case that our current system is outdated. Oh, and in the spirit of the Fairness Doctrine, one of the authors is a confessed Democrat.
Posted in Health care | Tagged: Health care, Health insurance | 1 Comment »
Posted by Liberty on December 2, 2008
In this article (Wall Street Journal, 12/02/2008), William McGurn writes about how Conservative, free market solutions for health care could help the Big Three Automakers and the rest of us. John McCain touched on the idea of separating health insurance from employment a little bit during the campaign but he failed to really sell his ideas for reforming health care.
“For companies, such an arrangement would help shift the responsibility for health care from employers to employees. And because these plans give health-care consumers more control over spending decisions, they also help restore some price-discipline to the market.
For employees, benefits that might not have been as obvious when times were fat are now easier to see. A worker who owned and controlled his own plan would not be trapped at a job simply because of its health benefits. A worker who owned and controlled his own plan would not be at the mercy of business managers and union leaders who agree to cut health benefits as part of a corporate rescue. And a worker who was unfortunate enough to be laid off wouldn’t have to worry about his family losing their health coverage along with his job.”
I purchase my own individual health insurance plan. I do think that this could be part of a solution to our health care problems in the U.S. My plan isn’t dependent on an employer–it’s something that I take responsibility for. For plans like this to become more common and functional for more people, I do think that significant changes do need to take place but at this particular time, it’s what works best for me. Increased competition between plans, increased transparency into the costs of medical services and more competition between medical providers are all things that need to happen through the free market. Employer-provided plans serve to remove the consumers of medical services from the costs associated with their plans. I think what we need is more individuals taking responsibility and control.
Posted in Health care | Tagged: Health care | Leave a Comment »