Nationals Health Insurance

All of us have, in the last few years, become more acutely aware than ever of the large sums that are being poured into the American health industry. For employees the costs of coverage have become critical elements in the bargaining process. But it is Medicare and more Particularly Medicaid and the different reactions to the two programs tell us a lot about the politics of althernative funding mechanisms that have sensitized us all. Medicaid costs have expanded well beyond expectations, and there has been a significant underestimating of expenditures. Furthermore, the public’s perception of Medicaid has, I believe, been one of failure. Perhaps the public’s image is colored, by the fact that the Medicaid system is part and parcel of a welfare system which is itself  unpopular. But whether Medicaid failed or not, and if it failed, why it did is somewhat irrelevant. The fact is that the program has led many to the view that there must be a better way to finance health care.

This feeling is also present perhaps to an even greater extent in the  legislative and executive branches of government. Medicaid and Part B of Medicare ( which involves government matching out of general tax funds ) have both grown rapidly even in a time of tight budgets. Thus, both programs have created difficulties for those who have tried to restrain budget growth, and who have attempted to save dollars in competing social programs in order to finance Medicare-Medicaid increases.

If I am correct that these are among the reasons that the consideration of national health insurance has moved so far so quickly, it  suggests that there are three goals involves increasing the accessibility and availability of medical care services. Some would call this goal “system change,” and it may be that they are right in arguing that the goal can be attained only with a change in the medical care system . In any case, however, the point is clear : the public’s irritation is with more than just the level of financing : it involves the actual delivery of medical care.

A Second goal involves the financing of care. The financing goals include regularizing medical care costs to make them more predictable, to make them as painless as possible,  and to distribute them more in such a way that income is not a barrier to the receipt of care. Thus, the public may be saying that it would like the costs spread differently over time and over the population.

The third goal, as indicated, involves prediction and control of health expenditures in government budgets. Prediction and control are, of course, closely interrelated since, in part, the lack of control and the open-endedness of the system, it blank check aspects, has made budget projection very tenuous in recent years.

Accessibility, system change, and control and predictability of costs are topics reserved for the other papers at this conference. The topic of this paper, “Impact…on Financing,” has up to this point not generated the amount of discussion that has begun on system changes, protection against financial stress for individuals, or prices and costs. Perhaps this lack of discussion is due to the fact that Americans fail to recognize the equity considerations involved in the choice between alternative funding mechanisms, say between income and payroll taxes, view these issues as matters for technicians, and believe that the number of ways tax revenues can be derived are limited and that fewer options exist than is the case. If so, this is regrettable. How funds are raised and the burden that thus falls upon various income groups is something that should be debated by the general public and its representatives. It should not be left to technicians.