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America and health care

In the light of the recent passage by the U.S. House of Represenatives of the Senate’s version of healthcare reform and the ensuing wailing, gnashing of teeth and smearing of soot in the hair by opponents of said reform, let me give my view – as an outsider – on the matter:

It’s a question of morality.

It astounds me — and, frankly, every other non-American USA-watcher in the developed world — that the richest nation on earth, whose very constitution proclaims the pursuit of life, liberty and happiness to be it’s highest ideals, whose citizenry so loudly profess to live by Christian virtues, would not guarantee that some form of basic, minimum healthcare be available to all of its citizens independently of their ability to pay.  It utterly astounds me.  If I were American, it would disgust me that this had not happened 50 years ago.

If my income and my wealth is above average for my society, I have an ethical duty to subsidise the health care of those who are, for whatever reason, at the lower end of the spectrum.  Yes, there are issues of free riders and of personal responsibility, but they simply do not matter when answering the basic question.  The government of a country, acting on behalf of that country’s people, has a moral imperative to provide a minimum level of care to all of its citizens.

I am not saying this as a screaming socialist.  I freaking hate socialism.  I love the market (when it’s allowed to function properly with full transparancy).  I support (at least partially, and possibly fully) privitised social security.  I like the idea of small government.  I rage against the nanny-state in Australia and in the UK.  I worry about encouraging dependency and a sence of entitlement in those people assisted by the government.  But those concerns take a back seat on this issue.

So, yes, the second question (a two-for) is to ask what the minimum level should be and how to pay for it.  But first question should have been a no-brainer.

If all the country can afford is a polio shot and a packet of aspirin, then that’s what they should provide (hopefully a charity or two might help out, too).  But if the country is the richest in the history of the planet, they should be able to stump up for a bit more.

And, yes, for the next criticism, this particular reform by the U.S. Congress is nominally promising more than it will reallly provide when it comes to the fiscal deficit.  Yes, again, given America’s political structure, U.S. government spending won’t be truely corrected until there is a real crisis approaching (as opposed to the make-believe crises being proclaimed by people opposed to the bailouts and stimulus package(s)).

I don’t care.  The child of an unemployed, drug-taking high-school dropout should not be deprived of basic access to a doctor just because we’re angry at their parents.  Nor should their parents, come to that.

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Just a smidgen more on US healthcare reform

My previous comment on US healthcare reform, which was actually a comment on the current Australian system, got quite a few eyeballs thanks to John Hempton’s shout-out.  Anyway, I thought I’d highlight a couple of new developments for my little audience.

First, Republican Senator Olympia Snowe (of Maine), who sits on the Senate Finance Committee, has said that she will vote in favour of the suggested bill being proposed by that committee’s chairman, Max Baucus.  That is good for the Democrats as it will provide valuable political cover.  It’s no guarantee that she will vote in favour of whatever the Senate as a whole end up producing, or for whatever the Senate and House then negotiate as the final bill, but it’s still a significant move and the probability of her voting for those later versions has just increased.

Second, we have the fact that the healthcare insurance industry has recently done an about-face, from actively promoting reform to actively fighting against it.  Nate Silver points out why:

Take a look at what’s happened to the share prices of the six largest publicly-traded health insurance companies since Labor Day, which was about the point at which the Democrats appeared to regain their footing — at least up to a point — on health care.

Weighted for market capitalization, these insurance stocks have lost 11 percent of their value since Labor Day, wiping out about $10 billion in value. And that’s understating the case since the major indices have gained 5-8 percent over the same period — the insurance industry stocks are underperforming the market by just shy of 20 percent.

So why have they tanked in the stock market?  Nate suggests two reasons:

Firstly, the individual mandate has been weakened to the point where it’s arguably a tokenish provision. There are good, policy reasons to be worried about this, although the insurance lobby’s reasons for being opposed — they’ll have less guarantee of an incoming phalanx of high-margin customers — are not necessarily the same as the public’s at large. The second factor is that the Baucus bill in certain ways treats the insurers fairly harshly, both taxing them directly as well as levying a surcharge on high-cost insurance plans.

I’d also suggest that the compromise version of the public option (that it be in the bill, but with states able to opt out if they wish [Paul Krugman, Talking Points Memo]) will have scared the insurance companies and investors as well.

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A description of Australia’s healthcare system

John Hempton has gotten to it before I did and written it far better than I would have anyway.  Have a read.  Although I agree that Australia’s system is much, much better than America’s current system or any of their proposed frameworks, I would add three negative comments about Australia’s system:

  • Medicare payments to GPs for a consultation by a patient are determined centrally (at the federal level) and have not increased with inflation.  At first that meant that GPs shortened each consultation to fit more people in per day, but in the long run served, I believe, to reduce the supply of GPs and as a result pushed people with minor ailments to hospital emergency rooms.
  • I don’t know if it is better or worse than other countries, but the administrative overhead in the state government health departments is surprisingly large, even to me.  I am led to believe that adminstrators and middle-managers exceed more than 50% of the staff of Queensland Health (and that does not include admin staff on the wards).
  • The federal-state funding arrangement in Australia is a real problem.  I don’t know whether the best policy is to put all health care in federal hands or to grant the states more revenue-raising posibilities, but something does need to happen.