I’ve been in a conversation about health care over at Allan B. Bevere’s place. That, combined with driving today for a couple of hundred miles listening to a bit of this and that talk radio, has been an enlightening experience. There is genuine fear out there that America is spending itself into bankruptcy, and the most serious threat is anything the president has proposed about health care reform. There seems to be no recognition that our health care costs are the highest in the developed world at 17% of GDP, as opposed to a range of 8% to 11% for other nations. For that we get the least comprehensive coverage, an excessive waste factor due to high insurance company overhead, endless delays and bickering over what is and is not covered, and plenty of room for fraud.
Critics trot out an entire menagerie of horror stories about delays in treatment and surgery, sloppy medicine and bureaucratic bungling in nations with socialized health care, and all of them are true. Which is why we are not interested in having those kinds of systems. What they fail to mention is the over abundance of stories just like that and worse that populate our own health care system.
There is an absolute conviction that any federal government program is, by definition, wasteful, inefficient, bloated with bureaucracy, and detrimental to individual freedom. Is that true? As it turns out, at least according to several government and industry sources, private insurance company overhead in 2004 as a percent of all health insurance payments was about 14%. That’s compared to around 2%-5% for Medicare (You can look this stuff up for yourself on the web; it’s all easy to find.) I’m sure there is a lot of fudge factor in these numbers, and one has to be careful that apples and oranges are separated, but it’s hard to believe that a thorough audit could eliminate a nine-point spread.
Right now congress is debating how to craft a health care reform bill and pay for it, and it’s going to be rough. Paying for it is a budgetary issue that cannot take into account whether the nation as a whole can lower its total health care costs as a percent of GDP. It can be concerned only with the effect on the federal budget. Moreover, congress is loathe to do anything to curb insurance company excesses, and will probably end up with some addition to our current Rube Goldberg contraption providing second rate coverage for many of the uninsured without changing anything else. Conservatives will gloat that they stopped socialized medicine, but they will have done so at an enormous cost to human suffering and waste. If that’s the case I hope the president vetoes it and tells them to start over.