High-Quality, Universal Health Care Is Possible -- With No Premiums or Deductibles

By Maggie Mahar, Health Beat. Posted July 16, 2008.

This article appeared originally as a two-part series on Health Beat.

Most plans for health care reform that stress "choice" give families the opportunity to choose from a menu of plans that offer insurance at different prices. In effect, families are "free to choose" the health care plan that they can afford. (More accurately, they are "forced to choose" the plan they can afford.)

Imagine, instead, a proposal for health care reform that guarantees free, high-quality health care for all Americans. No premiums. No deductibles. Under this plan, the government insists that all insurers offer the same comprehensive benefits to everyone, including: office and home visits, hospitalization, preventive screening tests, prescription drugs, some dental care, inpatient and outpatient mental health care, and physical and occupational therapy.

These benefits are more generous than Medicare's and more comprehensive than what 85 percent of all employers offer their employees. (Individuals who want to purchase coverage for additional services like concierge medicine, experimental drugs for serious conditions, complementary medicines or more mental health benefits could do so.)

If this all sounds too good to be true, you need to read Healthcare, Guaranteed: A Simple, Secure Solution for America by Dr. Ezekiel Emanuel. Published this month, Healthcare, Guaranteed offers a bold, refreshing plan for health care in America. The charm of the proposal is four-fold: It faces up to the fact that reform won't pay for itself, and it offers a funding mechanism that is fair and efficient and could deliver high-quality care nationwide. It regulates insurers, forcing them to concentrate on quality. Finally, and perhaps most importantly, this plan insulates our health care system from the lobbyists who, today, have far too much control over our health care system.

Emanuel has the background and experience needed to help draft a blueprint for health care reform. An oncologist who also has a Ph.D. in political science and now serves as chair of the Department of Bioethics at the Clinical Center of the National Institutes of Health, Emanuel is attuned to the ethics as well as the politics of medicine, and he understands the needs of seriously ill patients.

Emanuel's ambitious plan, the Guaranteed Healthcare Access Plan, would replace employer-based insurance with insurance that offers generous benefits to everyone who is not now covered by Medicare, Medicaid or the State Children's Health Insurance Program. (Anyone now enrolled in one of these three programs could, if they wish, switch to the new Guaranteed Healthcare Access Plan. Over 15 years, Medicare, Medicaid and SCHIP would be phased out.)

Affordable, High-Quality Care

Under the proposal, all Americans would receive a health certificate entitling the individual or family to enroll in the health care plan of their choice. In most cases, they would keep their current physician. The certificate would not be a "cash card" to buy services; instead, it would be a voucher that gives the individual or family the right to enroll in whatever insurance plan they choose.

Thus, under Emanuel's plan, all Americans are treated equally. The vouchers are of equal value, and the health plans must all offer the same rich package of benefits. No cheap "Swiss cheese" plans riddled with hidden holes. No high-deductible plans. To distinguish themselves, health care plans would have to compete on quality, not on price.

Emmanuel's plan also eliminates vexing problems like mandates that require all Americans to purchase insurance. No one would be forced to buy insurance; everyone would simply receive a voucher that entitled them to an equal place in our health care system -- at no charge.

How Do We Pay for It?

But what is most intriguing about the Guaranteed Healthcare Access Plan is its financing. Emanuel would pay for the nation's health care with a 10 percent value-added tax (VAT). Revenue from the tax could not be diverted to other uses such as the military or Social Security. No other tax revenues would be used to pay for the plan. And although Emanuel calls for a new tax to support the program, in the end, we as a nation would be paying no more than the $2.2 trillion that we now spend on health care. The money would simply be collected in a more equitable way and spent more rationally, avoiding waste and excessive administrative costs.

Unlike many health care reformers, Emanuel doesn't shy away from acknowledging the true cost of providing high-quality care for all Americans. Unless they are funded, other plans might provide health insurance to everyone, but not affordable health care.

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Maggie Mahar is a fellow at the Century Foundation and the author of Money-Driven Medicine: The Real Reason Health Care Costs So Much (Harper/Collins 2006).

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