The Missing Link in the Health Care Debate

Sara Horowitz

The Missing Link in the Health Care Debate

Blame it on the zeitgeist: this election cycle, everyone wants to get in on the health care debate. It used to be political poison, but now it's a required talking point for every presidential candidate.

In all the plans we're seeing from Democrats, which Jacob Hacker has helpfully anatomized, one thing seems to be missing: intermediaries. There's the single-payer model; the public/private hybrid, which assumes that competition will drive efficiency; and the mandatory buy-in, like in California and Massachusetts.

But all these proposals force consumers into a direct relationship either with the government or with an insurance carrier. Neither is a particularly good fit. In the former, the individual is one of millions; in the latter, a consumer is merely a source of potential profit. The reason the employer-based system works -- to the extent that it does work anymore -- is that the employer acts as an intermediary. It creates a group, and spreads risk across a diverse pool of consumers.

What we need, now that fewer people are getting insurance through employers, are new intermediaries. Professional associations, community groups, and even religious congregations could aggregate their members and negotiate with insurance carriers for lower rates and better coverage. And a group that represents a big chunk of revenue for an insurance company can throw its weight around for its members' benefit, acting as an ombudsman when a consumer needs to dispute a claim.

One thing I've learned from talking to freelancers is that America is a country of entrepreneurs and innovators. It's time for policymakers to take an innovative approach to health care. We don't have to duplicate the Canadian system, or even anything else that's out there now. Let's just think about what works: forming groups and building institutions to act as intermediaries. I'd like to hear something new from a candidate on the stump, and talking about intermediaries as part of the health care solution would certainly be that.

Sara Horowitz: Author Bio | Other Posts
Posted at 6:45 AM, Apr 24, 2007 in Health Care
Permalink | Email to Friend | Comments (5)

Comments

Why?

Why would we weigh down this human right with professional associations or book clubs? Almost every other developed nation in the world has some form of a system where there is a single, national, non-profit risk pool administered by a public agency that pays healthcare providers. Everyone is in, there is choice and competition among providers, and we don't waste 30% of care dollars pumping up insurance industry profits. Intermediaries would just serve as a new layer of bureaucracy serving to siphon off care dollars and exclude patients.

Why wouldn't we go with what's already working around the world?

I think the issue is national financing, not necessarily national delivery of healthcare. And the financing should be national. But as our economies get decentralized, it makes sense for people to have options of where to get their insurance -- not just through or an employer, or just through the government.

Intermediaries? One-third of our health spending is already wasted in layers of administrative waste. The systems with less intermediaries can spend more on care for precisely this reason.

If huge employers covering millions, Like GM, FORD and Xerox can't use their huge purchasing power to negotiate affordable premiums, why in the world would you think that a local community church could?

You say waste--I say restructuring so that people get benefits from the groups they plan to be members of for a long time. A membership group's central mission is to promote the well-being of its members. It can focus on wellness, prevention, and affordability, as opposed to most companies, whose central mission is profit maximization.

The government should finance healthcare. Unions, nonprofits, and others should deliver it. We are an example of that model.

Your suggestion has fallen on hard ground because too many people
with an opinion on health insurance fail to understand the core
concept of health insurance (spreading the risk [with risk pool
subsidy where spreading risk cannot deal with costs equitably]).