It has been a couple of weeks since the landmark Oregon Experiment paper came out, and the buzz around it has subsided. So what now? First, with passage of time, I think it is worth reflecting on what worked in Oregon. Second, we should take a step back, and recognize that what Oregon really exposed is that health insurance is a small part of a much bigger story about health in general. This bigger story is one we can’t continue to ignore.
So let’s talk quickly about what worked in Oregon. Health insurance, when properly framed as insurance (i.e. protection against high, unpredictable costs) works because it protects people from financial catastrophe. The notion that Americans go bankrupt because they get cancer is awful and inexcusable, and it should not happen. We are a better, more generous country than that. We should ensure that everyone has access to insurance that protects against financial catastrophe. Whether we want the government (i.e. Medicaid, Medicare) or private companies to administer that insurance is a debate worth having. Insurance works for cars and homes, and the Oregon experiment makes it clear that insurance works in healthcare. No surprise.
The far more interesting lesson from Oregon is that we should not oversell the value of health insurance to improving people’s health. While health insurance improves access to healthcare services (modestly), its impact on health is surprisingly and disappointingly small. There are two reasons why this is the case. The first is that not having insurance doesn’t actually mean not having any access to healthcare. We care for the uninsured and provide people life-saving treatments when they need it, irrespective of their ability to pay. Sure – we then stick them with crazy bills and bankrupt them – but we generally do enough to help them stay alive. Yes, there’s plenty of evidence that the uninsured forego needed healthcare services and the consequences of being uninsured are not just financial. They have health consequences as well. But, claims like 50,000 Americans die each year because of a lack of health insurance? The data from Oregon should make us a little more skeptical about claims like that.
So what really matters? Right now, we are pouring $2.8 trillion into healthcare services while failing to deliver the basics. To borrow a well-known phrase, our healthcare system is perfectly designed to produce the outcomes we get – and here’s what we get: mediocre care and lousy outcomes at high prices. Great.






