The fiscal nail in the single-payer coffin
Health-care access and affordability are important goals. But they will never be achieved with a single-payer system – and that isn’t bad news.
Health-care economics tells us it’s unlikely that a single-payer health system can efficiently and effectively deliver health care in an affordable manner. Look no further than Vermont, where progressive political ideals have crashed into fiscal reality as its governor just scrapped plans to implement a single-payer health system.
Vermont had embarked on a $45 million multiyear planning project that aimed to abolish the state’s fledgling private-insurance market and launch the nation’s first statewide single-payer health-care system in the nation, Green Mountain Care, in 2017. But that plan got a dose of fiscal reality when the state’s own accountants estimated funding the program would require doubling the state’s current revenues.
But this story isn’t new. Cost overruns in government-run health-care programs are almost entirely predictable, because there is no incentive for the consumer to limit utilization and services. Turns out, lawmakers in Congress are about to learn this important lesson when it comes to ObamaCare.
According to a recent analysis by Republican members of the Senate Budget Committee, or SBC, the law is now estimated to increase the federal budget deficit by $131 billion over the next 10 years.
Not only is this is a far cry from the original estimates from the Congressional Budget Office, which predicted the president’s signature health-care law would reduce the deficit, but it is a $300 billion swing from earlier estimates that ObamaCare would reduce the deficit, if the SBC numbers prove accurate.
Overreaching, one-size-fits-all, bureaucratic approaches to health-care reform are doomed to fail. Solutions that both put patients in charge of prioritizing their own needs and preferences should be the starting point of any health-care reform.
One such approach is allowing for high-deductible catastrophic coverage combined with a health savings account, or HSA. Others include block-granting Medicaid to facilitate sliding-scale premiums for the purchase of private coverage with an HSA, and providing equitable tax treatment for both large HSAs and individuals purchasing health care on their own. These measures would go a long way to putting patients back in charge of managing their own care, and controlling costs.
In that way, private competition and financial incentives can create the kind of competition that could deliver fiscally sustainable health care.
Health-care access and affordability are important goals. But they will never be achieved with a single-payer system – and that isn’t bad news.
One can only hope that Illinois lawmakers, including state Reps. Mary Flowers, Kelly Cassidy, Linda Chapa LaVia, Greg Harris, La Shawn Ford and Emanuel Chris Welch, who co-sponsored legislation to establish a single-payer health system in Illinois, can learn from Vermont’s debacle.