To Chris Farrell
You almost had a break through moment. Then you broke down. Your straight story took a nose dive.
On June 19th, your Straight Story opined on health care reform. Health care needs to be de-coupled from employment, you stated boldly. Your words were, “sever the link between your job and your health care.” You went on to say:
It makes no economic sense to me that if someone loses their job their family loses their health care insurance and don’t tell me that COBRA covers it, because COBRA is so expensive very few people who lost their job can pay for it even with the new subsidy. It makes no sense; it is so inefficient; and it is immoral.
But wait a minute. You also said that by “severing the link between your job and your health care” you could lose your job and still have health insurance.
How does this work?
Do you really have any idea what health care costs in this country?
COBRA rates are so expensive because they reflect the actual cost of group health insurance. Unless you are working for a company with a bunch of old sick people, you are unlikely to buy an individual policy with comparable coverage for less than COBRA rates. The key word here is comparable.
Please don’t misunderstand me. I think you make one of the most important points in this current health care debate. Health care needs to be de-coupled from employment.
But payment should be tied to income. Otherwise you put it out of reach for too many people. Not just out of reach for the recently unemployed, but also for young people just trying to enter the job market, and for low wage workers in general.
This is not just a health care issue; it is an economic development and work force development issue. Health care costs distort our competitive economy.
More important, it distorts incentives in the workforce. How many people with bright creative ideas are reluctant to test them in the market place, because the one market entry barrier they don’t know how to overcome is the cost of health care?
The 18,000 people a day that die for lack of health insurance are not just tragic personal stories, they are tragic economic stories. They are stories of people who have been denied the opportunity to contribute to the American economy.
Mr. Farrell, I trust your instincts. But on this one, you need to go back to the drawing board.
Please don’t tell me you are enamored with the idea of competing insurance companies. On what will you base your decision? Do they cover lap band surgery, but not cardiac rehab? They have your primary care doctor in their network, but not your cardiologist. They have your internist in the network, but they don’t cover cardiac rehab. Oh, you didn’t notice that language, until after you had your heart attack?
Please Mr. Farrell. I am not one to criticize the insurance companies. I work with them every day. Like you, I fault the connection between health care and employment. Insurance companies do what those who hire them ask them to do.
We can keep the insurance companies. I am not sure we should, but they do seem to have a loyal and devoted following in Congress and the White House, even if nowhere else. But let’s make them play by our rules. I propose a set of very simple rules. They would apply to both public and private plans.
1. No medical underwriting, guaranteed issue and guaranteed renewability.
2. Rates would vary based only on age, location and benefits.
3. All carriers would pay the same provider the same amount. Our current system pays providers next to nothing for treating poor people (Medicaid), a bit more for treating old people (Medicare), and a healthy profit for treating employed people. That makes no sense and should be replaced by a payment system that rewards good outcomes.
4. There would be very limited set of benefit options, similar to the current Medigap regulations.
I think I just described Medicare, almost. There’s the solution – Medicare for everyone. And we can even keep the insurance companies. After all, aren’t they the ones paying Medicare claims now?
On this issue, Mr. Farrell, your story may be straight, but it falls way short of its target.