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I think there are couple very important concepts that are almost always omitted from health care debate, but they are so fundamental that forgetting and/or disturbing them really messes up discussion and conclusions. First, health care is not health. Medical care is a very important part of health, but environmental and lifestyle factors are very significant as well. Amount of resources, time and energy devoted to the issue of medical care is disproportionate to its importance in overall health. I mean that time spent discussing/legislating and resources spent paying for medical care have it's opportunity costs of ignoring other issues or not being able to afford improvements in other areas. Second, health insurance is not health care. Health insurance is a financing structure. Real debate should be just around ways and how much to pay for medical care and what level of care to get in return. USA as compared to other developed countries pays twice as much in total health care related expenses. I repeat, the number is two (2)!! There are infinite ways to measure level of care - longevity, child mortality, comfort, access, malpractice, innovation etc.. It's argued that US near the bottom on those metrics, but even if it comes out in the middle or on top, I don't want to argue this point. It's still comparable, why we pay twice as much? Health care is provided through private comprehensive health insurance. Word "insurance" makes sense - there are serious risks that are disruptive, require significant resources and immediate attention, you get protection, transfer the risk now, pay fees all life, come out even. That kind of insurance been around forever. Word "comprehensive" means that you get everything related to health through the same mechanism as you would use in case of catastrophe. You finance things that are not really disruptive or unpredictable or costly - routine checks, regular supply of medicine, mood swings. That kind of insurance is 50 years old and came about during war time as a perk to employees because wages were not moving and then got big when it got tax preferred treatment. Private comprehensive coverage is absurd way to pay for things. Classic example is imagining paying for gas through auto insurance and electricity thorough homeowners. When ConEdison sends a bill you submit a claim to your insurance company. Yes I know it's not a perfect analogy and it's as false as any other, but I think you get the point. But because you set up all-enclosing financing structure this way - it fucks up the whole mechanism. First, you are user of the health care, but not paying customer - insurance company is a customer and then it passes whatever it thinks you should consume to you at its terms and with multiple intermediaries. Doctor's incentives are affected as well. Then there is a pharmaceutical industry with it's own agenda, technology firms, etc, it's all non-transperent and over administrated by design, on top there is a insane regulation of insurance business on state level, everyone knows how it's done. (I'm all for government regulation of health care, insurance is not health care). Moral hazard written all over, helped by unnecessary competitive forces and business interests. It's not patient centric - it's not doctor centric, it's standard self centered oligarchy (for each 2 MDs in the country there is 1 health insurance employee), that just should not be there (Yes, I remember that I took my actuarial exams on Property & Casualty side:)). It's not like "we have issues in the system" - it's faulty design from the begging. Let insurance insure - catastrophic risks and such, costly things, have national pools for that through taxation. Make HSA more attractive and use them more, health care costs comes out of the savings anyway one way or the other. It definitely can be done much better (number is 2:)) Decisions about redistribution of wealth and things like that can be made here equally well. I suggest to check out this lady for more details http://reginaherzlinger.org/

 

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I think it makes sense to have a national mandatory catastrophic coverage. Premiums collected in form of taxes, everyone on US soil are covered (that may even include illegal immigrants). I think I made my point for it be national. Why mandatory? Because if you have a national program that is optional it will be subject to adverse risk selection. Basically, only people who are sick (bad risk) or fraud will choose to opt-in. So if all you have is bad risk and there is no healthy people in the program - it's impossible to run, because you have average premiums coming in and worse than average payouts coming out. Good example of gloriously failed program due to adverse selection is a National Flood Insurance Program. Right at the design stage it was predicted to fail by many and it didn't disappoint. However it's been around for half a century and maybe we learned a thing or two that can be used for health care. Private insurance deals with this issue by selecting risk and pricing it accordingly. It's a complex and expensive process, government absolutely can not do it properly. Also forcing government to be selective beats the purpose of universal healthcare. On the side note - limiting the ability of private insurers to select and price risk (this is what we have right now) is a receipt for disaster, it never works well, you have government like functionality and overhead and issues of private sector. Centralized mandatory program is very easy and cheap to run, just concentrate on fraud prevention and cost mitigation. To make it really cheap and easy to try it out it can kick in first at truly catastrophic levels - say 30k or 50k (whatever the numbers are). The layers of coverage between 10k and 30k can be provided as they are right now optionally by the private sector. And then you can phase them out if it works. Below 10k - improve HSA. It can be expanded, customized for age groups and income levels (right younger people with high income benefit the most from it) and so forth. Spend time and energy on educating patients, cost controls, prevention etc. There are obviously numerous issues in this setup, there are things in between routine and catastrophe, there are all this private guys who loose their jobs and companies, also if empower the consumer to much and to quick - he can fuck up like we saw it happen with 401k. But it does not have to be dramatic momentary change, I'm not arguing for pitchforking health insurers tomorrow, we can try things, phase them in and out, mutate.