- Single Payer Meets Managed Competition:The Case for Public Funding and Private Delivery
Common sense and empirical evidence suggest that single-payer health insurance, combined with competitive private delivery, would be the most cost-effective way of achieving the major, widely accepted goals of health care reform. Among the current presidential candidates, Kucinich and Gravel have the most promising reform proposals, with Edwards's and Obama's as fall-backs.
American health care is a terrible mess. Over 46 million Americans—about 16 percent of the population—lack health insurance; millions more are underinsured.1 Those lacking health insurance face serious consequences. The Institute of Medicine puts it bluntly: "Uninsured children and adults suffer worse health and die sooner than those with insurance."2 Moreover, an estimated eighteen thousand unnecessary deaths occur every year in the United States due to lack of insurance.3 A further consequence for many families is threatened financial security. Meanwhile, the cost of foregoing needed medical services is enormous: an estimated $65–$130 billion per year,4 exceeding what some leading experts consider necessary to cover all the uninsured.5 Lack of reliable, continuous access to health care is an intolerable feature of our health care system.
Other features are also dispiriting. Despite not covering nearly one of every six Americans, we spend far more on health care per capita (including the uninsured), and as a fraction of gross domestic product, than do citizens of any other country.6 Since 2000, overall health care expenditures have risen at roughly 10 percent per year.7 Ford and General Motors buckle under the strain of paying health insurance premiums. Meanwhile, insured patients frequently complain that insurance companies restrict their choice of doctors and impose bureaucratic hassles. And for years there has been a widespread perception—whether accurate or not—that managed care has damaged quality of care.8 On the whole, the public is increasingly dissatisfied with American health care.9 Considering this widespread dissatisfaction, and with Democrats reclaiming power in Congress, it's no surprise that health care reform is back as a leading issue of domestic policy. [End Page 23]
Every candidate in the 2008 presidential field was invited to a health care forum in Las Vegas on March 24, 2007. No Republican candidate accepted the invitation. The seven Democrats who participated promised measures to achieve universal coverage, but their strategies feature important differences.10 Hillary Clinton, Barack Obama, John Edwards, Christopher Dodd, and Bill Richardson all intend to retain employment-based health insurance while introducing such measures as employer mandates, individual mandates, and the expansion of public programs. Dennis Kucinich and Mike Gravel, by contrast, favor abolishing employment-based insurance. Both advocate immediate adoption of a single-payer system of national health insurance—a tax-funded system that enrolls everyone by virtue of citizenship or residence—although Mike Gravel wants to combine the single-payer system with a voucher approach. (These and other measures will be explained in the next section.) Meanwhile, Obama and Edwards have expressed openness to an eventual move away from an employment-based system to a single-payer system. At a first cut, then, we can distinguish reform proposals that embrace employment-based insurance, necessarily preserving a multiplicity of private insurers, and proposals that abandon employment-based insurance while embracing single-payer financing (which, as we will see, may or may not preserve a role for private insurance). Which direction is more promising? What would a promising reform plan look like in greater detail?
To begin to answer these questions, we need to identify the goals of health care reform. Although perfect unanimity on this matter is impossible, the following four goals enjoy widespread support among Americans and will serve as benchmarks for evaluating proposals for reform: (1) achieving universal coverage; (2) establishing cost controls; (3) enhancing—or at least not diminishing—patients' freedom of choice while minimizing bureaucratic hassle; and (4) sustaining the quality of care.11
But are these goals simultaneously achievable? Are they compatible? The best evidence that they are compatible and achievable is the fact that numerous countries have achieved them fairly well. The health care systems of these countries—including the...