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Monday, January 01, 2007

Paul Krugman: A Healthy New Year

Paul Krugman hopes 2007 will bring improvement to our health care system:

A Healthy New Year, by Paul Krugman, Commentary, NY Times: The U.S. health care system is a scandal and a disgrace. But maybe, just maybe, 2007 will be the year we start the move toward universal coverage.

In 2005, almost 47 million Americans — including more than 8 million children — were uninsured, and many more had inadequate insurance.

Apologists ... try to minimize the significance of these numbers. Many of the uninsured, asserted the 2004 Economic Report of the President, “remain uninsured as a matter of choice.”

And then you wake up. A scathing article in yesterday’s Los Angeles Times described how insurers refuse to cover anyone with even the slightest hint of a pre-existing condition. People have been denied insurance for reasons that range from childhood asthma to a “past bout of jock itch.”

Some say that we can’t afford universal health care... But every other advanced country somehow manages... Americans spend more on health care per person than anyone else... Yet we have the highest infant mortality and close to the lowest life expectancy of any wealthy nation. How do we do it?

Part of the answer is that our fragmented system has much higher administrative costs than ... the rest of the advanced world. ... In addition, insurers often refuse to pay for preventive care ... because [the] long-run savings won’t necessarily redound to their benefit. And ... we lag far behind ... in the use of electronic medical records, which both reduce costs and save lives by preventing many medical errors. ...

If it were up to me, we’d have a Medicare-like system for everyone, paid for by a dedicated tax that for most people would be less than they or their employers currently pay in insurance premiums. This would, at a stroke, cover the uninsured, greatly reduce administrative costs and make it much easier to work on preventive care. Such a system would leave people with the right to choose their own doctors, and with other choices as well...

Can we get there from here? Health care reform is in the air. Democrats ... are talking about providing health insurance to all children. John Edwards began his presidential campaign with a call for universal health care.

And there’s real action at the state level. Inspired by the Massachusetts plan..., politicians in other states are talking about adopting similar plans. Senator Ron Wyden of Oregon has introduced a Massachusetts-type plan for the nation as a whole.

But now is the time to warn against plans that ...[don't take] on the fundamental sources of our health system’s inefficiency. What’s wrong with both the Massachusetts plan and Senator Wyden’s plan is that they don’t operate like Medicare; instead, they funnel the money through private insurance companies.

Everyone knows why: would-be reformers are trying to avoid too strong a backlash from the insurance industry and other players who profit from our current system’s irrationality.

But look at what happened to Bill Clinton. He rejected a single-payer approach, even though he understood its merits, in favor of a complex plan that was supposed to co-opt private insurance companies by giving them a largely gratuitous role. And the reward for this “pragmatism” was that insurance companies went all-out against his plan anyway, with the notorious “Harry and Louise” ads that, yes, mocked the plan’s complexity.

Now we have another chance for fundamental health care reform. Let’s not blow that chance with a pre-emptive surrender to the special interests.

Previous (12/29) column: Paul Krugman: A Failed Revolution
Next (1/5) column: Paul Krugman: First, Do Less Harm

    Posted by on Monday, January 1, 2007 at 12:15 AM in Economics, Health Care, Policy | Permalink  TrackBack (0)  Comments (38)


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