HEALTHCARE GUEST BLOGGING….In the June issue of the Monthly, Ezekiel Emanuel and Victor R. Fuchs propose a national healthcare plan called Universal Healthcare Vouchers:
Here’s how it works.
Every household in America will receive a voucher entitling its members to enroll in a private health plan of their choice. All plans will be required by law to guarantee the basic features of what most Americans now receive from their insurers: doctors’ visits, hospitalization, pharmaceuticals, and catastrophic coverage. These insurance policies will not cover everything. Viagra and cosmetic surgery will not be included, but Americans will still be able to purchase them and any other service or care with their own money.
Those with preexisting conditions or high medical costs will be protected because they will have guaranteed coverage with any plan they choose. UHVs solve the problem of adverse selection by adjusting the reimbursement value of the voucher to the differing risk levels an insurance company absorbs by taking on different patients. So, the payment to insurers for covering older, sicker patients will be higher than for younger, healthier Americans, eliminating the incentive to exclude high-risk patients.
Read the whole thing to learn further details behind their plan. (And don’t let the “voucher” talk fool you. It seems to be there mostly as rhetorical jiu jitsu to befuddle conservatives, not because it has anything in common with, say, school vouchers.)
Zeke is going to be guest blogging here for the next few days to explain how UHVs work and why they have a chance of succeeding where more traditional plans don’t. I’m going to act as his skeptical interrogator. Why skeptical? Not because I oppose universal healthcare, of course, but because I have some doubts about various features of his plan. Let’s see if he can convince me, OK?
I’m going to start with insurance companies. A key part of the UHV plan is that it relies on private insurance companies to deliver healthcare, a very different approach from most other national healthcare schemes, in which doctors either work directly for the government (for example, Britain) or work for themselves but are reimbursed for their services by the government (for example, France). So here are my questions:
It appears to me that insurance companies are part of the UHV plan for purely political reasons: by keeping them in the system, they’re less likely to fight against UHVs in Congress. Is this really the only reason insurance companies are part of the UHV plan? Are you just trying to buy them off, or do they truly have a role to play?
As you note, the problem with private insurance companies is adverse selection: they have a big incentive not to insure people who are sick (or likely to get sick). Your solution is to provide bigger vouchers to sicker people so that insurance companies will still want to cover them.
I’d like to hear more about this. Is it really possible to efficiently match up supply and demand with a centralized system like this? Do you have any examples of similar systems where something like this has worked? And since your plan doesn’t force insurance companies to cover people, what happens if there’s no insurance company that wants to cover me because they think the government is lowballing the likely cost of my illness? Who insures me then?
Tomorrow I’ll pick on something else. For now, though, I want to hear more about insurance companies. Do we really need them, or would we better off just girding ourselves for a huge fight and getting rid of them?