We've Got You Covered: Rebooting American Health Care - Hardcover

Einav, Liran; Finkelstein, Amy

Hardcover

ISBN 10: 059342123X ISBN 13: 9780593421239

Verlag: Portfolio, 2023

Inhaltsangabe

From a MacArthur Genius ​MIT economist and pre-eminent Stanford economist comes a lively and provocative proposal for American health insurance reform

Few of us need convincing that the American health insurance system needs reform. But many of the existing proposals focus on expanding one relatively successful piece of the system or building in piecemeal additions. These proposals miss the point.

As the Stanford health economist Liran Einav and the MIT economist and MacArthur Genius Amy Finkelstein argue, our health care system was never deliberately designed, but rather pieced together to deal with issues as they became politically relevant. The result is a sprawling yet arbitrary and inadequate mess. It has left 30 million Americans without formal insurance. Many of the rest live in constant danger of  losing their coverage if they lose their job, give birth, get older, get healthier, get richer, or move.

It's time to tear it all down and rebuild, sensibly and deliberately. Marshaling original research, striking insights from American history, and comparative analysis of what works and what doesn’t from systems around the world, Einav and Finkelstein argue for automatic, basic, and free universal coverage for everyone, along with the option to buy additional, supplemental coverage. Their wholly original argument and comprehensive blueprint for an American universal health insurance system will surprise and provoke.

We’ve Got You Covered is an erudite yet lively and accessible prescription we cannot afford to ignore.

Über diesen Titel

Über die Autorin bzw. den Autor

Liran Einav is a Professor of Economics at Stanford University as well as the Director of the Industrial Organization Program at the National Bureau of Economic Research. Amy Finkelstein is a Professor in MIT’s Department of Economics. She is an elected member of the Institute of Medicine as well as the Director of the Health Care Program for the National Bureau of Economic Research. Additionally, she has won the MacArthur prize and the John Bates Clark medal.

Auszug. © Genehmigter Nachdruck. Alle Rechte vorbehalten.

1

Poor Design

The ubiquitous risk of becoming uninsured

We are the only major country on Earth that doesn't guarantee health care to all people as a right," exhorts the progressive politician pushing for universal health insurance coverage. That's Vermont senator Bernie Sanders, speaking in 2015.

The eminent economist likewise laments, "The United States has the unenviable distinction of being the only great industrial nation without compulsory health insurance." That's Irving Fisher, speaking in 1916, a century before Sanders. Fisher was advocating for a bill that would make health insurance coverage mandatory, although with an economist's characteristic modesty, he did concede that his health insurance proposal "is not a panacea. It will not bring the new millennium."

The new millennium came-without Fisher's help or the passage of his bill-and the distinctive American dilemma remained: how to provide health insurance to the millions of Americans who lack coverage. But if the thirty million uninsured Americans were the only-or even the major-problem confronting US health insurance policy, there would be an easy fix. Just extend one of the many existing health insurance programs to cover the uninsured.

That wouldn't cut it. The problems are much bigger, and much deeper, marbled like fat throughout. Consider this: In any given month, about 12 percent of Americans younger than sixty-five are uninsured. But twice that number-one in four-will be uninsured for at least some time over a two-year period.

The very purpose of health insurance is to provide a measure of stability in an uninsured world. Yet, perversely, existing health insurance coverage is itself highly uncertain. Right when you fall ill and need insurance most, you can find yourself suddenly, unexpectedly, uninsured.

This risk of losing coverage doesn't get the attention it should. It gets far fewer headlines, campaign proposals, or even academic analyses than the plight of those who are uninsured at any given moment. In fact, we were ourselves at first surprised by the statistics on insurance uncertainty. So much so that we dug a little further into the data to confirm that the precarious nature of health insurance coverage persisted in the post-Obamacare era. It does.

Salient or not, the uncertain nature of health insurance coverage is key to understanding the deep-rooted rot at the core of our health insurance house. This is not how insurance is supposed to work. But it's how it does "work" for all nonelderly Americans. Kids and adults. The healthy and-unfortunately all too often-the sick. The publicly insured and the privately insured alike.

Your tax dollars at work

Let's start with the precarious insurance of the privately insured. Almost half of the US population-over 150 million people-receive private health insurance through their employers or a family member's employer. That's almost all Americans who have private health insurance.

There's no natural reason why their boss doubles as their insurer. This unusual arrangement arose through an accident of history, a common theme of US health-care policy. During World War II, the federal government imposed wage and price controls to try to prevent inflation. Employers-desperate to attract and retain scarce workers-soon discovered a way to get around the wage ceilings and provide higher compensation. They could offer-and pay for-their workers' health insurance, because these payments weren't counted as "wages."

The practice of excluding employer payments for their employees' health insurance from the definition of employee earnings has remained in place to this day. As a result, any such payments are tax-free. An employee doesn't have to pay income tax on any contributions her employer makes to her workplace-based health insurance premium.

As any international travel aficionado knows, there's real savings to be had from being able to buy things tax-free. The "duty-free" nature of employer-provided health insurance is a large part of the reason that employers are the source of most private health insurance in the US. It's also responsible for a whopping $300 billion a year in forgone tax revenue that the government doesn't collect on wages in the form of employer contributions to health insurance premiums. To put that number in perspective, that's about two fifths of the amount of public spending on K-12 schooling in the United States.

The unintended reliance on the employer as health insurer has a number of unfortunate consequences. For one thing, it's Robin Hood in reverse, providing more of a handout to richer Americans-whose tax rates are higher and who therefore get a much bigger subsidy when something is excluded from their taxable income. For another, workers can end up "locked" into their jobs-and not retiring or changing jobs-simply because of the health insurance their employers provide.

And here's the real kicker: if a worker becomes too sick to work they can . . . wait for it . . . wait for it . . . that's right . . . lose their health insurance. Precisely when they really need it to cover their medical bills.

Kind of a dumb way to set things up, if you think about it.

In the mid-1980s, this absurd state of affairs prompted federal legislation to try to address the problem. It created a legislative patch, known as COBRA coverage, specifically designed to help people maintain their health insurance even after they leave their jobs. It does so by allowing employees to continue their current health insurance coverage for up to eighteen months after having left their employers. Well intentioned no doubt, but ultimately COBRA may be only slightly more useful than snake oil.

We've already alluded to some of the problems with COBRA in the introduction, when we described how the COVID-19 pandemic inspired the government to temporarily strengthen that law. It was moved to do so because, in another recurring theme of US health policy, the patch had a catch.

The real problem is that while COBRA gives the former employee the option to continue to enroll in her former coverage, she must pay the full cost of that coverage. When she was employed, her employer paid for most or all of her health insurance premiums. Now that she's lost her job-and with it her paycheck-she has to pay the full premium herself, which averaged around $12,000 a year in 2019. "Sticker shock" is what one senior benefits consultant termed the typical reaction to the high premiums from COBRA coverage, "at a time when you're financially stressed already."

One New Jersey woman who had worked as a clerk at the same firm for nearly twenty years found herself laid off after she was diagnosed with stage-three ovarian cancer. She died a year later at the age of fifty-two, having stopped her treatments. "It wasn't financially sustainable to keep paying Cobra out of pocket," said her daughter, reflecting on her mother's decision.

It should therefore not be too surprising to learn that, in practice, COBRA coverage for the unemployed is quite rare. Only 130,000 Americans had COBRA coverage in 2017, although more than eleven million adults were unemployed that year. "[COBRA] is well named because of its bite," one journalist quipped.

Isn't it ironic

While the privately insured risk losing their coverage when they lose their jobs, many people with public health insurance face the opposite problem: they can lose their coverage if they get a job and their income increases. Eligibility for public coverage can also require that people wait until they are sufficiently ill to get coverage; they can then lose that coverage if their health improves. Once again, this creates uncertainties-and glaring gaps-in health insurance coverage.

Some of these gaps are vividly illustrated by an in-depth ethnographic account of a...

Details zur Ausgabe

• Verlag: Portfolio
• Erscheinungsdatum: 2023
• Sprache: Englisch
• ISBN 10: 059342123X
• ISBN 13: 9780593421239
• Einband: Gebundene Ausgabe
• Anzahl der Seiten: 304
• Kontakt zum Hersteller: Nicht verfügbar
• Verantwortliche Person: Nicht verfügbar