In a democracy such as ours, widespread dissatisfaction over some issue may be a necessary condition for reform, but it is not a sufficient one. That is the lesson that current public dissatisfaction with health care teaches.
Many people complain about the existing system. Households are frustrated with out-of-pocket costs, a lack of choice of providers, difficulty in switching jobs because of some pre-existing conditions or complete lack of insurance coverage.
Employers and employees struggle with sharply rising health insurance costs. Many people are outraged that a high proportion of people do not have health insurance coverage. Local elected officials struggle with paying the medical expenses of uninsured people who use public hospitals or end up in situations where a county or city foots much of the bill.
It is clear what sort of system would be popular.
This system would not have co-pays or deductibles. There would be full choice of doctor, clinic and hospital. It would include full coverage for any treatment that one’s doctor deems necessary — including experimental treatments, potentially beneficial devices, extended mental health counseling, elective procedures that may bolster self-esteem and full chemical addiction treatment.
There would not be any complicated forms or waiting lines. Every American would be covered. Costs would be borne by large corporations or other wealthy entities, and there would not be any increase in local, state or federal taxes.
In other words, most people would be satisfied with some sort of medical utopia. Unfortunately, it ain’t gonna happen! Moreover, pining for the unobtainable best is the enemy of the feasible good.
The current system has many faults. It is inefficient and unjust. We spend more money per capita than any other nation for results that are no better than those in many countries.
But we won’t have constructive change until we achieve some national consensus on what constitutes feasible improvement. That will require most of us to sacrifice at least some possible feature we each deem particularly important. If we cannot reach such consensus, we will continue to muddle along, spending a lot of money and generating a lot of frustration.
Monetary policy in the 19th century is a good analogy for the dilemma we face. From the day Alexander Hamilton proposed a proto-central bank in one of the Federalist Papers until Woodrow Wilson signed the Federal Reserve Act in 1913, the United States was divided over how we manage the nation’s money.
We experienced two iterations of Banks of the United States, Andrew Jackson’s re-charter veto, Civil War greenbacks, the “Crime of 1873,” numerous panics and busts, various silver purchase acts, Bryan’s Cross of Gold Speech and other monetary policy phenomena. But we didn’t settle anything until the severe recession following the Panic of 1907 forced opposing groups — with radically different ideas on monetary policy — to reach a practical compromise that fully satisfied no one.
We are, however, much better off with the Federal Reserve than without it. Similarly, we would be better off with practical reforms of health care financing than without them. We have not reached a point, however, where the desire for improvement overcomes the fear of losing some preferred feature of the existing system.
No industrialized country is free from problems in health care delivery or financing. Canadians don’t like their waiting lists, and providers are exiting like mad in certain regions. The United Kingdom reforms its National Health System every decade or so, and its citizens never like the results. All of the socialized systems in continental Europe have budgetary problems and all ration services in some way. No nation is really happy with its system.
Most of these nations do have health outcomes that are generally on a par with those in the United States, though many don’t have the latest technology. Most spend much less per person than we do in the United States. While there is some level of discontent nearly everywhere, household surveys in various countries show a higher level of satisfaction with the system in nearly every industrialized country than here.
Clearly we could do a better job with the resources at hand. Doing so, however, depends much more on the effectiveness of our political system than on any economic analysis.
© 2003 Edward Lotterman
Chanarambie Consulting, Inc.