Healthcare in the US: solved!

OK–just kidding. Earlier today, I took one of those silly Facebook polls asking “Are you in favor of a Government run healthcare system.” My yes vote apparently struck a chord since it has been generating a bunch of replies, so I thought I’d expound a bit on the blog.

I am completely in favor of the discussion of a single-payer, publicly funded healthcare system. Unfortunately, such a discussion is impossible in the current US congress. The arguments I’ve seen against a single-payer system boil down to two points, both of which I reject. The first is that the government can’t run anything well. People site examples of the Veteran’s Administration, Social Security, etc, but this is a red herring: the point isn’t that the government is great at running programs, but that the private sector has in general failed miserably in providing healthcare–at least if you happen to be poor, or not white, or living in the wrong sort or neighborhood. This is an ethical question: if you believe that everyone deserves some basic level of healthcare (as I do), the private sector will never deliver. We could pass regulations to force companies to comply, but doing so might create more bureaucracy than just offering a public option.

The second point I see made is that a public system would destroy the market for private healthcare. If this turned out to be true, it would mean that the public alternative was out competing private companies–which should be impossible if everything the government does is overpriced and inefficient. Moreover, the whole argument here relies on the idea that companies–insurance companies in particular–have a right to make money off healthcare and that the private market for healthcare is a good thing.

What we think of as the “insurance industry” is nothing of the sort, at least if “industry” is thought of as a productive enterprise. Insurance, particularly at large scales, is nothing but a source of friction. Insurance companies operate by creating massive bureaucracies and then hiring people (who we pay) to help navigate those bureaucracies ineffectively. But that is fine, because at every step of the journey the insurance company makes money. Put another way: insurance companies are required as for-profit corporations to look out for the interests of their shareholders, and the best way to make a profit is by being as inefficient as possible at delivering healthcare while still taking in as much money as possible.

Ultimately, I reject the basis for the survey that started this whole discussion. I see no reason that there has to be a choice between a for-profit market-based system and a government-run system when both can be avoided. Some places to start: convert all insurance companies into small non-profit organizations funded by membership dollars with some additional public funding. The public funding part could work like the FDIC, so if the small non-profit happens to have a train wreck, cancer hot-spot, or tornado nearby they are covered. Another possibility would be developing more local healthcare cooperatives. Options like these are not part of the national debate, because they don’t fit into the existing either/or framework. In the meantime, why not have a public healthcare option?