Thursday, September 24, 2009

The Gadson Review's Healthcare Plan


I’m not in Congress, and so no one cares what my healthcare proposals are. But I’ve decided to share a plan that I think would solve at least some of the problems.

In 2005, the average family spent $10,728 on premiums; for individuals, it was $3,991. This amount is set to soar through the roof in upcoming years, and the consequences will be devastating, as I detailed here.

I would do away with employer health insurance, and offer everyone enough money to purchase a private catastrophic plan. These are typically much cheaper than the typical comprehensive plan. You can usually find such a plan for around $1200.  The government would subsidize the poor and working class, up to the full cost of the plan if necessary.

When stringent regulations are applied, no one would ever have to go bankrupt because they need an expensive cancer treatment. The government could make sure deductibles aren’t too high. It could also help the poor and working classes out by paying part or all of the deductible before the catastrophic care kicks in.

That leaves the problem of preventative care. For that, we would give out means-tested vouchers for routine care such as checkups and tooth cleanings. The subsidies should be generous—perhaps $1,000 or so—to make sure no one skimps on necessary preventative care. Any unspent amount could be diverted to a health savings account, so people could keep the money in reserve for the next year in case they need more. People would also be allowed to save their own money in this account.

This plan would incentivize consumers to shop around for good deals on checkups and exams, as they could keep unspent money, which would help with healthcare inflation. It would also be good economic policy. No longer would employers be saddled with high healthcare costs. My plan would cost around $2200 assuming that people stay healthy which is more than a $1500 savings over status quo.

A business would either use the money saved to expand the business and hire more people, or give it to workers in the form of higher wages. Prospective employers choosing between countries will have an easier time choosing to set up shop in the US.

Moreover, everyone would have access to care, and no one would be financially ruined by healthcare costs. Liberals and conservatives would both be able to support a plan that does these things.

Now, the fact that plan does away with employer based coverage could run into opposition from unions and employees. But I think we could explain that the plan means higher wages, and a stronger economy for them. What they really have to be convinced of, is that their care will get no worse. But the regulated catastrophic plans make sure they won’t go bankrupt, and the vouchers make sure they can get the routine care they need.

Another problem would be what sorts of procedures the vouchers pay for. Would they pay for abortion? Birth control? These sorts of things would cause controversy which could prevent the plan from being enacted, so perhaps such procedures and medical items would have to be left out. Many feminists would be upset. But here’s a question they should answer: Because women can’t get an abortion from a healthcare plan, should we also say they can’t get a check-up or a cavity filled?

What do you think of my plan? Take the poll.

2 comments:

  1. A better variation on that is have the government fund the catastrophic portion of everyone's mandated private insurance.

    For instance, let's see how much coverage we can get by taxing everyone's payroll by 1%, with a matching amount by employers.

    For the sake of discussion, let's say that covers all medical expenses for those not already covered by Medicare/Medicaid over $10,000.

    So, private insurers must provide a comprehensive, qualified plan to cover the gap. They know they will not be liable for anything above $10k. This gap insurance would be downright cheap.

    This is much simpler than your plan, because there is no need to do away with employer coverage. Some employers would jump at the chance to provide the gap coverage to their employees. They are still saving lots of money, and they still have this benefit to lure employees in a competitive market (if the job market ever becomes competitive again!).

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  2. I think one of the problems is where you start defining "poor." What's the income line that works? It seems a tad malleable in most arguments that have a distinction between "poor" and "not poor."

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