Talk to Me Like I'm 4: Why Our Health Care System Failed Us and How We Can Fix It

By J. Goodrich, AlterNet. Posted February 12, 2009.

Medical firms may compete in apparent quality by offering the latest medical advances, but when other firms do likewise, the facilities may be duplicated and no one firm may end up with enough patients to keep the practitioners' skills in their application up-to-date. Yet someone will have to pay for all those facilities.

On Patches and Purse Strings

Now imagine this large patchwork health care quilt on the bed called the United States. Some of us lie under it comfortably, because the quilt above us is whole and warm. Others lie under a rip or a tear, turning and twisting while trying to avoid it. Yet others are not even under the quilt.

This is what the Obama administration faces. It is the new Keeper of the Quilt and needs to decide what to mend and how. This requires managing the three goals of universal access, low costs and high quality, a juggling act, because increasing access or quality tends to also increase the costs of care.

The first weeks of the new administration have already achieved an increase in access: The recent expansion of the State Children's Health Insurance Program -- the government health insurance program for low-income children -- guarantees health care access to as many as an additional 4.1 million children, and the new stimulus package proposes government subsidies designed to help the uninsured find affordable health insurance.

Based on his campaign Web site, Obama is planning several further measures that would add patches to the quilt to increase access: a play-or-pay requirement for medium-sized and large firms to either offer health insurance to their workers or to pay a fee toward such coverage by other means, a requirement for insurers to give affordable coverage to individuals with pre-existing conditions and a proposal to offer a program comparable to the Federal Employee Benefits Program to individuals who can't otherwise access care under the current system.

The last two must be offered together, because if private firms could still employ the pre-existing condition exclusion clause, the federal program would end up with mostly high-users (remember the "bad apples"?). This, alone, would make it look like a much more expensive program than the private alternatives.

Patches. These are all extra patches to the same old quilt, and good ones to get us closer to universal access. But they offer few new ideas about the costs and quality of care. The campaign Web site addresses those in the form of more emphasis on prevention and a greater focus on the use of technology and computers in medical decision-making. Though both of these are desirable changes, they are unlikely to lower health care costs by any large amount. For that, something more is needed: real cost control.

That will not come from measures that try to increase competition in the private health care markets, not even from opening a federal insurance system such as the Federal Employee Benefit Program to all comers. The Canadian and British systems are not cheaper to run because the government can out-compete private firms; they are cheaper because they are run under one vast budgetary system. This is the one-purse model of health care financing, and it works to contain costs in ways that health care competition will not.

Now, the Obama administration as the Keeper of the Quilt may not want a single-payer system. Those of us who are quite comfortable under our good corners of the quilt might fear that such drastic remaking of the quilt would leave us less well covered. And perhaps the United States sleeps better under the current system of rationing care by consumers' ability to pay for it than under alternative systems of rationing, such as treatment protocols, triage and the use of waiting times for non-emergency care. Perhaps.

But one day, soon, the American patchwork quilt of health care will become unaffordable if we all we do is sew patches upon patches for greater access without any tightening of the societal purse strings. The time is now ripe to sew a new quilt.

See more stories tagged with: health, obama, health care, single-payer, free markets, health care competition

J. Goodrich is an economist. Her writing has been published in the American Prospect, Ms. Magazine and on various political Web sites. She also blogs at Echidne of the Snakes.

Liked this story? Get top stories in your inbox each week from Health and Wellness! Sign up now »