Why Government Should be the Single Payer Provider of Healthcare

I understand that many people are horrified by the idea of “socialized medicine” where the government pays for our coverage instead of private health insurance companies. But here’s why I think healthcare is one area that should be provided by government and where the private sector solution is inappropriate.

The key reason is the nature of healthcare as an essential service. Let’s compare healthcare to the auto industry as an example. General Motors makes Cadillacs. Let’s say I want one but cannot afford to buy one. GM doesn’t care – they’ll sell the car to someone who can afford it and, while I may be disappointed, I can live with my old used car just fine. In the case of private run healthcare, one element of the car scenario is the same: the health insurance company is not in the least interested in my well being other than how it affects their profits. If I cannot afford their healthcare premiums or have a “pre-existing condition,” too bad for me. The difference, of course, is that while I don’t need a Cadillac, I might very well need healthcare coverage and not having it might bankrupt me, and that is an outcome that is good for nobody.

Essential services such as water, roads, land management, oversight and regulation, defense and so on are provided by government and paid for by taxes. I contend that healthcare is every bit as essential and that treating it as an essential utility makes sense. The government is one way to assure that everyone has access in an affordable way. Taxes would be higher but it would be essentially insurance – shared risk spread over everyone and thus probably much less expensive in total than the current proliferation of private insurance providers.

Our society tolerates vast discrepancies in wealth from the very poor (2007 poverty rate was about 12.5 percent that translates to somewhat over 37 million people) to the very rich. Were that not the case, private health insurance might be tolerable, but the wealth discrepancy means too many people cannot afford health insurance, medical services or medicine. This is something the other Western democracies have figured out and I hope we get the message soon and are not swayed by the barrage of self-serving propaganda that is bound to start coming from the health insurance industry and others who hate the idea of anyone being helped by the government.

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Why do we fear universal healthcare?

Sometimes (well, often, actually) this country puzzles me. This time it’s healthcare. The notion of a single-payer healthcare system in which everyone would be covered is meeting a lot of resistance. Now, it’s not surprising that the medical insurance and pharmaceutical industries are hitting hard with the usual scare tactics: the government will control your access to healthcare, there will be long waits, you won’t be able to choose your doctor, it’ll be too expensive, and the killer: it’s socialism! It is surprising that so many people believe this nonsense that comes from the only groups that benefit from the current inefficient and expensive system.

First, a reality check. We already have a government run system called Medicare. Last I checked, Medicare does not restrict which doctor you see (providing they are licensed), nor does the use of Medicare increase wait times. The main problem with Medicare coverage is that there are doctors and clinics that don’t take Medicare patients because the reimbursement rate is pretty low at this time. Regarding restrictions, it’s the HMOs and insurance plans that normally restrict you to a certain clinic and hospital. Medicare coverage does not depend on whether or not you are employed or wealthy enough to buy private health insurance or pay your health costs out of pocket. Under private insurance it’s true that the government is not making healthcare decisions about you. Rather, the private insurance company is and they have absolutely no interest in your well being but rather in their profitability. They don’t get rich by paying claims but by paying as little as they can get by with.

So why are we so easily scared of a government run universal plan but not scared of putting our healthcare in the hands of profit-making companies that have no interest in our well being but rather are interested in their bottom line? Many still tout the benefits of “free market” solutions to all our ills, ignoring a continuous stream of evidence that when greed is the main motivator, bad things happen (Enron, Worldcom, Arthur Anderson, KPMG, AGI, the wall street financial institutions, banks, Haliburton, Blackwater and on and on). When I was in business school the only ethic considered legitimate for corporations was to maximize shareholder wealth. Now even that minimal standard is ignored as top executives seem to be mainly about maximizing their own wealth even at the expense of the company’s health. There is absolutely no reason to feel comfortable putting our trust in health insurance companies and pharmaceuticals.

It’s as if we’re saying, “Universal coverage whether or not I have a job or can afford private insurance? No way! We’d rather live with the excitement of not knowing if I’ll be covered because of layoffs, health crisis, or some other personal downturn. What’s life without anxiety and lost sleep worrying about how we’ll take care of our family’s healthcare needs?” It makes no sense to me at all.