My grad school application said this had to be originally written for the application, but it didn't say I couldn't present it elsewhere once it was finished. The most of the health care reform idea is 15 years old (from when the Clintons were trying to get their health care reform plan developed and passed) but putting it all down on paper (or pixels) is new.
The four primary shortcomings of the United States' health care system are:
1. Not everyone is covered.
2. Employers are expected to provide coverage for their employees, which increases the cost of labor for those employers that meet the expectation.
3. Patients and medical professionals are burdened by paperwork requirements that are onerous enough to interfere with quality of life.
4. The total cost of health care is generally considered high. To the extent that the high cost is due to people prioritizing health care for quality of life reasons, it is beyond the scope of this proposal. But it within our scope to address the way in which insurance diminishes patients' incentive to choose cost-efficient treatments. Costs are also lowered when paperwork is reduced.
Read: Health Care Reform Linked To Doctors Pay Reform
The favored approach by many who want to overcome these shortcomings is a national health plan of some sort, usually along the lines of the Canadian or British plans. While such a plan would indeed address the shortcomings, it would have other drawbacks and is considered by most policy makers to politically unfeasible. On the other hand, the proposals put forth during the recent presidential election, including the one championed by the Obama campaign, make inroads in dealing with the first shortcoming, but do little to address the other three.
I propose here an alternative approach, which almost completely addresses the issue of coverage and eliminates the penalty on responsible employers, while making modest inroads against paperwork. It also has a modest beneficial effect on financial efficiency, with the actual level of care and cost adjustable by government policy on an ongoing basis. Furthermore, this proposal can be expected to have support from most of the interests that successfully lobbied to prevent health care reform in the 1990s.
I propose a voucher system, wherein the government supplies to each citizen and legal resident alien a credit, redeemable with an insurance company (more generally, and hereafter referred to as, a plan provider) for enrollment in a certified health care plan (plan, for short). The insurance companies would then submit record of their clients' enrollment to the federal government for prompt payment.
For a plan to be certified as eligible, it would have to include full coverage of those expenses that if they were not covered, would likely end up being picked up by the government on an individual basis. For instance, emergency rooms are currently required to administer necessary care in life-threatening situations, regardless of the patient's ability to pay. The cost of treating indigent patients is borne by the hospital and ultimately passed on to all paying users of the hospital's services. It is unlikely (and undesirable) that the mandate to treat indigent patients will be revoked, so it is incumbent on the new system to see that patients are not, for these purposes, indigent.
Other mandated items will include as much wellness care (routine checkups, well-baby visits, etc.) as the Surgeon General, with the advice of the Office of Management and Budget, determines to actually reduce health care costs in the long run. In determining total long-term costs, the Surgeon General will include indirect costs such as the effect on government finances due to taxpaying workers' lost productivity to to illness. But those indirect savings are to be included only to the extent they are not offset by foreseeable indirect financial costs to the federal government.
Government payments to plan providers will not be a fixed amount per subscriber. Rather, reimbursement rates will be set based on the age and sex of the subscriber, to reduce the incentives of the providers to market to some segments while putting obstacles in the path of others who want to subscribe. Geographic variance in costs will be ignored, as that variance is probably small in comparison to the political difficulties inherent in fairly weighing one locality's need against another's.
Enrollment will be for a period of one calendar year. The first time in a year that someone needs a covered service, he or she will present her voucher and be immediately enrolled in the plan that she chooses.
Babies will be covered under their mother's plan for their first sixty days, at no additional cost. In the event that the mother is not a custodial parent, any custodial adult may enroll the child for the remaining part of the sixty days in her or his own plan at no additional cost. If that plan is not suited to infants, the custodial adult may pay to enroll the infant in a different plan on a basis, pro-rated for the portion of the sixty days that have expired. After the sixty days is over, the custodial adults(s) will have received a voucher to enroll the baby in a plan of the adult's choice. Reimbursement to the plan provider will be pro-rated for the time remaining in the year.
Children whose custodial status changes during a year in which they've already been enrolled in a plan may have their coverage switched to a plan of their new custodian's choosing, for a small out-of pocket-fee. The government would then debit the account of the child's old plan provider and credit the account of the new provider based on the time left in the year.
For any plan to be certified, it must be meet the standards of certifiability throughout the United States, so that people moving during the year will still have covered medical services available.
Individuals in the custody of state or the federal government will have a plan chosen by the custodian. That plan, unlike plans chosen under other circumstances, may be directly administered by the government, but must in any case meet all requirements of certifiability. Upon mid-year release from government custody, a person will be given a voucher to choose a plan for the remaining portion of the year. Those who move into the country during a year will be also be given a voucher upon establishing any legal resident status.
Anyone who has not enrolled in a plan for the year, is not in possession of her or his voucher, and needs immediate medical service, will have their non-enrollment status verified by the medical provider, using a government web site. The patient may then for a small fee sign an affidavit that will serve as a replacement voucher.
The initial level of funding for the program, and therefore the monetary value of an individual voucher, will be set to neither increase nor reduce from the current level the portion of the economy that goes to health care spending. That level will be somewhat higher than would be needed if plans were to only meet the requirements for certifiability. Thus the plan providers will be able to compete for subscribers based on exact services offered, as well as on ease of paperwork requirements, networks of health care providers, and any other factor of interest to potential subscribers.
Routing health care spending through the plan providers, as this proposal does, may or may not be the most cost-efficient way to provide medical services. But it unquestionably has the advantage of not displacing the vast multitude of people who presently work for the insurance companies at a time when the country is fighting to stay out of a depression. It also blunts or even reverses the lobbying incentives of those companies, increasing the likelihood that a plan will be passed.
Because subscribers will have a choice of plans, the plan providers will have more incentive than they do now to keep paperwork requirements to a level that subscribers find tolerable. And because plans will compete in large part on services offered for a fixed price, there will be incentives for cost-efficiency. Coverage will be universal, except for those who can not establish legal residence. The proposals discussed during the campaign (by everyone other than Kucinich) would do far less and be at least as difficult to enact. A single national would do perhaps too much and be insurmountably difficult to enact. So this proposal represents the optimal path.
Note: I don't actually say in the proposal whether I think a single national plan would be preferable. I do think so, though I'm not entirely sure. But I think it's a red herring, because it would take all of Obama's political capital and then some to get it passed.
Reported by Dvd Avins's diary of Daily Kos.
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