Over the last few days, it’s become clear that there’s some confusion over some terms used in the debate over health care, and that led me to realize that people are using words and phrases without understanding what they mean or the implications.
This is not going to be a discussion on any candidate’s particular position, nor or the political realities which make implementing a revamped health care system in the states possible or not. And it’s not going to talk about where the money is coming from or not, nor issues with changing the current system. That’s going to be handwaved away in this case. That’s all in the past. Today is the first day of a new health care system.
But what kind of health care system do you want?
Question 1: do you want a system with universal coverage, a single-payer system, or a combination of the two?
Universal coverage means that everyone (more or less) is covered for health care. It has no statement on how those people are covered, nor what are they covered for (although the default assumption is at least the medical basics are covered).
Single-payer refers to a system whereby the money paying for the health care comes from one major source. In essentially every case, you are referring to a government. But perhaps not a single government. More on that later.
Note that those are two distinct things. You can have universal coverage that is not single-payer by requiring everyone to be covered by insurance they are responsible for getting (although the government may provide some assistance or put caps on how much the premiums might be). Switzerland is the classic example here. You can also have a single-payer system that isn’t universal. The VA in the US is an example: military personnel and some others get coverage (single-payer), but it isn’t available to the average person on the street (not universal).
The first goal should be universal coverage. So the new American system will have that. Now, what kind of single-payer system do you want?
If you look at most of the world, you’ll find that while universal coverage is the default assumption for health care in many countries, not many of them are pure single-payer. In Canada, Japan and Australia, for example, of total health care costs roughly 70% are funded by the government, with the users of health services (or their insurance companies) picking up the remaining 30%.
The important thing to note is that even though private insurance is still required (or at least a very good idea to have), by and large it’s to cover things that aren’t considered absolute medical necessities: if you have an extended stay in a Canadian hospital, your treatment and the supplies for it will be covered, as will your basic meals, but you want a phone, TV, semiprivate or private room? You’re paying for it.
Because these aren’t considered absolute necessities, the premiums are generally not bad as market forces and shoppers have a bit more flexibility here (and thus power). You can survive without a TV in your room for a few days, you’re not going to survive without the triple bypass. Rates covering medical transport are low because it’s rare that a person will require medical transport very many times in their life.
Question 2: Do you want pure single-payer, where government is the sole source of spending on health care, or do you go for a mixed system where not everything is paid for by government?
Question 2a: Which government?
In jurisdictions with single-payer systems, the level of government that actually pays for the system varies. In Canada and Australia, the subnational governments (states/provinces/territories) are responsible for the delivery of health care and provide funding through their own budgeting and taxes, with the federal government providing the balance. In other countries, funding is through taxes at the municipal/county/regional level, with higher governments again providing money if the local government can’t be self-sufficient. In a few (such as the UK) it’s essentially national funding.
In the American system, therefore, what’s the breakdown going to be? Will it be both levels of government providing the money through tax revenue? Will it be primarily at the state level with the federal government merely topping it up if there’s a shortfall? Will it be primarily federal?
Question 3: What will be covered?
Very, very few systems in the world (if any), single-payer or not, pay for every potential health care issue. Using Canada again as an example, diagnostics and hospital services are covered. Prescription drugs are not at the national level (and here Canada is an anomaly; most countries cover at least some meds). Now, that isn’t to say that no drugs are covered at all. What it means is that is the basic standards the provinces and federal government have agreed to, drugs are not one of the minimal requirements. Individual provinces run their own systems, but they also don’t cover everything.
For instance, Ontario has the Public Drug Programs, their insurance coverage for Ontario residents which covers their pharma needs. But there are limits: the province will only pay, without question, from a pre-approved list of of drugs (which you can search at https://www.healthinfo.moh.gov.on.ca/formulary/index.jsp). If your doctor decides you should have a drug not on the Formulary database, she can prescribe it and can apply to have it covered under the Exceptional Access Program, but that approval may not come. You can still get the drug, but you’re paying for it.
The reason for this is cost savings: doctors are well aware that 99+% of the time, an existing drug or a generic is perfectly adequate to treat a patient. They have no need for the latest and greatest that doesn’t actually provide any greater benefit in comparison to its cost. It also means that the approved drugs actually do something. Water (ie homeopathic magic juice) isn’t usually covered.
Incidentally, that’s why direct-to-costumer marketing (“Ask your doctor about Lipitazakviagialis”) is illegal in Canada and many other countries.
Is your single-payer system going to pay for acupuncture? Homeopathy? Therapeutic touch? Herbal remedies? Or are you restricting it to that evil “Western” evidence-based medicine? Will it pay for non-medical cosmetic surgery? If not, who gets to make that distinction between what’s medical and what’s not?
Will it go to the utter limit? Will your 90 year old bedridden grandfather with Alzheimer’s and stage 2 lung cancer get a replacement knee, totally paid for? If not, who makes that decision?
One of the criticisms currently leveled at the US system is the overkill on diagnostics: too many unnecessary tests given to patients even when medically unnecessary. Right now, because people are willing to pay for it, it’s not an issue, but if your single-payer is the sole source of funding, now the question becomes more important. If a kid fell off their bike and scraped their knee and their parents are really convincing and find a friendly enough doctor, does the system pay for the utterly pointless and medically unnecessary MRI? Does everything get approved? Or does someone say “No, that was stupid and we’re not paying for it”? Who makes that decision?
Question 4: How will the funding be distributed?
In many countries with single-payer, Canada again being an example, the money for the system is distributed based on the work that is done. A doctor sees a patient, orders an x-ray and some bloodwork. This is noted in their file, and the doctor bills the payer (the provincial health department) who pays the doctor, the x-ray department, and the lab for the work. If a doctor is a specialist, they can charge more for their services (based on their contract with the government). A GP who sees 15 people a day can charge more than one who only sees 10 doing the same thing per patient.
In countries with private clinics or hospitals, the institution submits their claim and, so long as the procedures and costs are ones which are pre-approved for automatic payment, they get their funding.
Will your single-payer system work the same way, or will your doctors work directly as salaried employees? How will their compensation be calculated?
Again, this isn’t questioning any candidates positions or demanding they be put out there during a campaign. These kinds of questions (and there will be a lot more) are the ones that, if you want a new health care system, will eventually have to be at least considered and the answers will vary depending on other answers.
It’s good that people are willing to seriously think about health care again and what has to be changed, but it’s not as simple as just calculating numbers from tax revenue and expenses or how much of someone’s income may be changed. There are some very fundamental questions that have to be answered about what you want a system to do and to be.
Possibly the biggest one can be summarized as this: when it comes to deciding what the system will provide/support/pay for, who says “No”? Because at the end of the day, in every system out there in the world and every potentially realistic one, at some point, someone has to say “No, we can’t/won’t do that. We’re not going to give you this drug that has perhaps 1% greater effect than an existing one and costs 800% more, no matter how much you want the new one. No, we’re not going to put your relative who is currently on a heart-lung machine due to congestive heart failure on the transplant list for a new kidney. No, I’m sorry, we’re not paying for someone to rub crystals over your sore back chanting passages in Mayan while burning incense because you don’t want to take a Motrin.”
Because with a single-payer system, at the end of the day it’s you paying for those things, not just the ones that are for your benefit, just as it is with me paying into the Canadian system. And I do want to have someone there to say “No” to help make sure that the money I’ve paid is effectively used.
