A nice profile in the New York Times.
To make coverage universal, Cutler advocates a $6,000 credit for poor families (and less, on a sliding scale, for others, tapering off to a small credit for people earning $50,000 and up). The credits would be redeemable as a sort of health-insurance voucher. Significantly, Cutler would extend credits to everyone — even to people who are covered now. Many employers, for competitive reasons, would still offer coverage, but access to care would no longer depend on either employment status or age.
This approach makes sense. The problem, as the article notes, is that the policymaking elite believes that health care spending is “out of control,” in which case Cutler’s approach would make things worse rather than better.
What I fear is “out of control” is the demand that government step in to run the entire health care system as a “single payer.”
For Discussion. What would be the arguments against the progressive voucher approach?
READER COMMENTS
Boonton
Mar 14 2005 at 10:54am
This is basically my ‘health care voucher’ idea. The only thing I would add is some element that would require limited variation in premiums for insurance companies that accept the vouchers (that way insurance companies can’t ‘cherry pick’ taxpayer money by pricing people who really need coverage out of the market). After all it is the taxpayers money still and they have a right to demand something in return!
Here’s an additional feature to promote cost savings:
1. Define a bare bones ‘universal coverage’ package.
2. Require that everyone purchase at least this ‘default package’ with their voucher.
3. Any money left over (say the bare bones cost $3000 and you have $3000 left over) will go into a private ‘medical account’. A person can then carry over this account year by year and use it to purchase either supplemental medical care directly (say from specialist doctors not covered by the bare bones plan) or ‘fancy’ insurance policies later on if they wish. When they die money left in their medical account would become part of their estate that they could will to others. Also let them withdraw a portion of their account as cash after a certain time period (say 50% of any dollar older than 5 years).
Benefits:
A. Universal coverage
B. Consumers have a powerful incentive to achieve cost savings. Doing so allows them to build up a nest egg that they can use to purchase care directly or turn into cash.
C. Increased savings by giving people incentives to not spend all of the voucher if they can.
Lawrance George Lux
Mar 14 2005 at 3:58pm
The idea appeals, but with the ‘add-on’ defect of all Governmemt programs; everyone crowds into an available program. Tapering to $35k makes more sense, though much harder to pass. lgl
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