The Debate Over Health Care Reform

Many politicians, academics, and citizens have been advocating the position that the American health care system is in need of comprehensive reform. Proponents of this position rely on three major factors: the high costs of health care, the relatively low quality of care, and the large number of persons who are uninsured.

The costs of health care are escalating rapidly. Health care costs in the United States have more than doubled in the past decade and accounted for 17.9 percent of the country’s Gross Domestic Product in 2010. Health insurance premiums continue to rise faster than wages. Americans spend more on health care than any other country in the world. US health care spending reached $2.6 trillion in 2010. Employer-sponsored health care plans have increased more than 100 percent in the past decade. Some health economists have predicted that the United States’ health spending will reach $4 trillion by 2015.

Statistical measures and indicators suggest that, despite this high level of health care spending, the quality of health care available in the United States is low. According to statistics compiled by the US Census Bureau and the National Center for Health Statistics, a baby born in the United States has an average life expectancy of about 78 years. While the life expectancy is higher than in previous years, the United States’ life expectancy continues to lag behind many other countries in the world, such as most European nations, Japan, Canada, Australia, Singapore, Jordan, and Guam.

Finally, many millions of Americans are forced to go without health insurance entirely. This problem is exacerbated by the rising costs of care. Rising costs are the main reason why hundreds of thousands of companies have stopped offering health coverage for their workers. Also, due to the sluggish economy, many people have lost their jobs in recent years. This means that those who are unemployed often have no health care. Many who cannot find new jobs have been forced to take part- time work, and these jobs typically don’t offer health care benefits. The number of the uninsured continues to rise. Gallop polls found that 14.8 percent of Americans did not have health insurance in 2008. This number increased to 16.4 percent in 2010 and 17.1 percent in 2011.

For people who are underinsured or who lack insurance, getting health coverage can create a financial crisis. The high number of uninsured has health and social implications as well. While laws mandate that hospital emergency rooms take in all people, including the poor and uninsured, these people still often do not get the medical care they need, especially at the appropriate time. “The uninsured are less likely to see a doctor … and are less likely to receive preventative services,” notes Arthur Kellerman, a medical professor and cochair of an Institute of Medicine (IOM) panel that has studied the problem. Thus they often wait until medical problems become severe before seeking medical care, creating more costs for the health care system that are passed on to others.

Proposed Solutions

Health care reform has become one of the most important issues in American politics. It took center stage for the entire first year of the presidency of Barack Obama (1961—). Advocates of health care

reform have proposed several different systems that they believe would solve these and other problems. Among the most popular proposed solutions are a single-payer system, a rationing plan, and mandates.

A single-payer system is defined as a health care system that pays for doctors, hospitals, and other health care providers out of a single fund. Canada utilizes such a system nationwide, and Medicare is a domestic example. In Canada, for example, doctors are paid by a fund with money taken from taxes collected by the national and provincial governments. The government collects funds, sets fees for medical services, and pays health care providers.

Proponents of a single-payer system argue that it would simplify the United States’ patchwork system of multiple insurance providers and greatly reduce administrative costs in health care. Doctors would benefit by not dealing with multiple insurance forms. Nonaffluent patients would benefit from more affordable health insurance. Opponents argue that a single-payer system is too radical a change from the American status quo. They also argue that having the government control medical prices and costs will inhibit the development of new medicines and technologies and may compromise the quality of health care.

The term “rationing” means dividing up scarce resources among people who want access to them. Many experts have concluded that offering every type of medical service to all the people who need or want it is not possible. They believe it is important to develop guidelines on what type of care should be offered and who should be eligible for it. At the small-scale level, allocation may affect decisions about individual care. If five people need a heart transplant, but only one heart is available, a decision must be made about whom should receive the transplant. On a larger scale, allocation might involve a government’s decision about how much money to spend on expensive drugs and high technology equipment for the elderly and how much to spend to prevent childhood diseases.

Advocates of a rationing plan argue that rationing care is the only way to rein in the growth of health care costs. They also argue that it is a way to ensure that everyone receives some basic level of care, which is key to preventing the widespread health problems faced by the uninsured. Opponents of rationing argue that it raises basic issues of fairness. Who would set the guidelines about what care is available? Other people think that health care services should be available to anyone who needs them. They argue that government and the medical community have a moral obligation to ensure that everyone has access to the health care they require. Finally, many opponents of rationing are opposed to having the government play a role in private medical care decisions. In the summer of 2009, opponents of rationing said that government-run care rationing would result in the creation of “death panels” in which government bureaucrats would literally decide who should live or die. This assertion had no basis in fact, but it was sufficient to frighten many Americans, especially elderly Americans, who were already concerned about how proposed health care reform might affect them personally.

Another approach, being tried by the state of Massachusetts, builds on the United States’ system of private health insurance. Under legislation passed in 2006, all residents were required to obtain health care coverage, either by purchase or through their employers. In addition, people under a certain income threshold receive subsidies from the state government. A state agency, the Connector

Authority, helps package insurance options and negotiates rates from insurance companies. Part of the theory is that by mandating everybody to participate in buying health insurance, there are more funds available to provide universal health coverage. The Massachusetts plan had some initial success, enabling 150,000 previously uninsured state residents to obtain affordable coverage. But some argue that maintaining universal coverage will become increasingly expensive, especially five or ten years in the future. Interestingly, while running for the 2008 and 2012 Republican presidential nominations, Massachusetts Governor Mitt Romney explicitly promised not to expand the Massachusetts model to the rest of the nation, arguing against a “one-size-fits-all” approach, even as several Democratic candidates were touting Massachusetts as an inspiration for their own health care proposals.