POLICY: The uninsured

The Center for Health System Change continues to pump out great stuff, including this piece from Len Nichols called 10 myths about the uninsured. Go read it because it’s very sensible and makes directly the link between the mess we have of an individual insurance market, the fact that the majority of the uninsured cannot afford insurance, and that (as Alain Enthoven will tell you) health benefits are part of compensation, not an independent cost to business. Coincidentally over at Business Word, Don Johnson, a (non-foaming at the mouth) conservative had a sensible piece on the uninsured yesterday. Don almost lets it slip in his last paragraph when he says:

    I have long advocated requiring everyone who pays Social Security and Medicare payroll taxes to provide proof on their income tax forms that they have purchased basic health insurance for themselves and their dependents. If people don’t provide such proof, they are taxed the equivalent of a year’s premium, payable monthly, and that money is put into a pool that provides catastrophic health insurance to those who won’t buy health insurance for themselves.

So despite some recent comments about Enthoven and me , it seems that Don, too, is in favor of universal insurance. His version of it is called an individual mandate, with a mop-up social program for the truly indigent, those outside the system. What Don misses is that he’s only got half the solution. Yes, the uninsured should be forced to pay into the system for some of their insurance, but as Nichols points out

    "if policy makers really want to increase coverage, they’re going to have to subsidize people, probably quite substantially, since most of the uninsured have incomes below twice-times poverty"

Of course there is already a cross subsidy of the uninsured by all of us who use health services and find that we are charged more than cost by providers who are also treating the uninsured. It would just be more sensible if the subsidy was clear and obvious. But again this is only half the issue. The Commonwealth Fund reported thatemployers continue to support providing health insurance. But, and this is not a minor "but", more and more of the cost of premiums are being forced onto employees. Meanwhile the proportion of smaller employers (with less than 100 employees) who believe that it is "very important" to provide insurance is only 54%, and only 44% of those employers who do not currently provide insurance think that it’s "very important" that they do so. It’s the employees of these employers who make up the majority of the working uninsured, who are themselves about 75% of the uninsured.

In other words, to get to universal insurance you either need an individual mandate, an employer mandate, or some kind of social insurance system (maybe Medicare-for-all). The first two need some cross-subsidy and the last needs to change "premiums" for "taxes." The first two also in some part rely on an individual and small groups insurance system which is a total mess, charges far more for the exact same products that are sold to large groups, and probably cannot be fixed without major legislation too. In the end, we’re not getting any of these solutions in the next few years. But at least the discussion has restarted. . . . .

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