Thursday, February 1, 2018

It's Time for Republicans to Rethink Healthcare Policy

Writing in the New York Times, Peter Suderman, features editor at Reason magazine, urges Republicans to start over on healthcare:
If the halting, messy debate over legislation to overhaul health care has taught us anything so far, it’s that when it comes to health care, Republicans don’t know what they want, much less how to get it.
He suggests three principles to guide the rethinking process.

First, give up on universal coverage. I think what he means is give up on having everyone’s healthcare paid in full by the government. I don’t think he means giving up on universal access—the idea that no one should find themselves entirely locked out of the healthcare system.

Second, any plan should include unification of our healthcare system, now a bewildering kludge that is fragmented among employer-based coverage, Medicare, Medicaid and the individual market.

Third, health coverage should be viewed as a financial product, that is, as “a backstop against financial ruin.” For middle- and upper-income households, that means assuming responsibility for routine medical expenses, making it possible to “focus government assistance on the poorest and sickest.”
This should be obvious, and yet it is not. Our system subsidizes workers with six-figure salaries and wealthy retirees while sidelining the poor and the sick with Medicaid, a system that many doctors won’t participate in because of low reimbursement rates.
As it happens, there is a policy option out there that perfectly fits Suderman’s three principles: universal catastrophic coverage. UCC would provide everyone now covered by Medicare, Medicaid, employer-based or individual coverage with an insurance policy that has a deductible scaled to income, say, ten percent of the amount by which household income exceeds the poverty level. That would protect the middle-class against financial ruin while leaving them responsible for routine care; it would largely remove subsidies for top-earners; and it would provide full coverage for the poorest and sickest.

Suderman mentions catastrophic coverage in passing, but, in my view, it should be the centerpiece. Selling UCC would, as Suderman says,
Take a significant investment of time, creativity and study, policy entrepreneurship, and some difficult political and legislative choices. It would require patience and political salesmanship. And it would not result in an immediately popular bill that could easily pass the Senate with 51 Republican votes this summer.
Very true. But then he ends his piece by saying one thing with which I strongly disagree:
[O]ver time [these principles] would distinguish Republicans from their Democratic rivals and give them a positive, productive policy pitch to run on.
That is far too partisan for my taste, and far more partisan that I would expect from the editor of a magazine that has, at least historically, tried to be more than just another cheerleader for the GOP. Instead, I think UCC could, and should, be pitched as a transpartisan compromise with potential to attract support from conservatives, progressives, and libertarians alike.

Reposted from Related posts on UCC:

How the GOP Can Win on Healthcare (Niskanen Center)
What a Good Conservative Health Plan Would Look Like (VOX)
A Health Care Plan That Is Universal and Bipartisan (NYT)


  1. I think it doubtful that is what he, or most of those on the right would find acceptable. For them, access has always meant for those with the means to pay. The UCC would be far too redistributionist for them. It sounds far more that he wants to move away from medicare entitlements and from an income based approach towards an income and wealth based approach, depending on what he considers financial ruin, a significant loss or debt and bankruptcy. He may be satisfied with one that leaves people with zero net worth as long as it is them paying up to that point and government only coming in when there is no alternative. A return to pre employer provided and pre medicare days.

  2. Of course, I can't really speak for what is in Suderman's mind. I am saying "pay in full for the poor" corresponding to his idea that government should focus its efforts on the needy, and I put a sizeable deduction in the UCC formula corresponding to his idea to protect only against ruinous expenses. It would be nice if he would weigh in himself on those points.

    Note also that the "10%" and the poverty-threshold that I use in my formula are parameters that are open to negotiation. If you, or Suderman, think the percentage should be higher or the threshold lower, we'll just hash that out in committee until we get a number we can agree on.