U.S. Health Care: Expensive and Leaves 40 Million without Coverage
Health care reform will be one of the hardest challenges that President Obama will have to face. The unexpected withdrawal of Tom Daschle, the projected Health and Human Services Secretary, further complicates the picture. Powerful insurance and medical lobbies have been blocking or stunting any attempt at reform. The memory of the burning defeat suffered by the Clinton administration is still alive. It's not easy to reform a system that absorbs one seventh of national income, that pays handsomely doctors and healthcare professionals, and guarantees high prices to Big Pharma and the companies supplying medical technologies, and which after all provides good-quality healthcare to two thirds of the national population.
The risk is that, as it has happened for decades, the interests of doctors, hospitals and insurance companies will keep prevailing on the general interest of the American people and the well-being of their economy. Yet the Obama administration could be the one that finally achieves health care reform, for two reasons. The first is economic, the second social. Health spending, both private and public, is a huge burden on the productive economy. On average, health costs are 50-60% higher than those in Germany and France, and almost double those in Italy and the UK. The goods and services produced in the US are losing competitiveness because their prices have to factor in the high costs of private and public medical insurance. The problem with US health care is not caused by the skewed ration between the public and private sector, but by the excessive level of aggregate health expenditure. Also, the current economic crisis could favor a more aggressive stance in public policy, as well as lead to a containment of medical costs and a rationalization of medical insurance.
Secondly, the hopes for social change condensed in the world-famous slogan "Yes, we can" could give Barack Obama enough popular backing to put an end to the scandal of 40 million people, prevalently working in low-end services or of lower middle-class status, that do not have medical insurance and thus receive health care in a limited fashion, if at all. These people do not receive prompt and state-of-the-art treatment. This is not only unfair, but also inefficient, since people resort to emergency rooms to get the care they need, with high costs and complicated systems to refund hospitals for services which do not have insurance reimbursements attached.
The irrationality of the system is acknowledged by all. The issue is thus not about the diagnosis, but about the cure. How to provide coverage to the 20% of the population presently excluded, without nationalizing the insurance industry? This is the true challenge that Obama will have to meet. In other words, can private health care systems provide universal coverage under the constraint of economic efficiency?
Perhaps Obama should tread upon the footsteps of LBJ's Great Society reforms. In 1964, Congress passed the biggest program of social protection in the history of the United States, by instituting Medicare (the program of universal medical insurance for the elderly) and Medicaid (the set of programs targeting the poor administered by individual states). With the Great Society, tens of millions of Americans were able to get proper health care for the first time in their lives, and today nobody any longer questions the wisdom of that choice, although the ambitious reform, originally crafted by JFK, was passed mostly because of the murderous event in Dallas just a few months before.