Universal health care – a cost benefit?

I quote again from T. R. Reid’s The Healing of America: A Global Quest for Better, Cheaper and Fairer Health Care.  The three paragraphs can be found on pages 233 – 234.

A unified system makes it much easier to use digital record-keeping and smart cards like the carte vitale in France and the Gesundheitskarte in Germany.  These digital records cut administrative costs, and they make for better medical care as well, because the doctor or pharmacist can instantly see what other treatment, tests, and medications the patient has received.  The United States certainly has the technological skill to introduce digital medical records –in fact, that system I admired so much in France was designed in the USA.  But we don’t have a common record-keeping system here, because each of our overlapping systems and insurance companies has its own regimen.

Beyond that, a unified system eliminates the gamesmanship and cost-shifting that permeates American health care.  In the United States, whichever entity is asked to pay for the treatment of  a particular patient will save money if it can shove that patient off to another system.  And so hospital emergency rooms try to push sick veterans out the door; why should the hospital pay for somebody’s care when there’s a separate VA health care system that could bear that cost?  Some financial advisers counsel sick people on ways to reduce their net worth, so their medical bills can be shifted to Medicaid.  If hospitals are underpaid by one payer – – for example, Medicare – – they make up the difference by raising their fees for other payers – – for example, private insurance plans.  In contrast, if there’s only one system paying for care, there’s no need to shuffle patients around and play paperwork games to shift the cost.

Beyond that, a single system for all creates an incentive for preventive health measures.  As we’ve seen, U.S. insurance companies generally don’t want to pay for preventive medicine, because the customer will likely have switched to another company or another system (like Medicare) long before there is any payoff for the investment in preventive care.  In contrast, a system that covers everybody for the full extent of their lives will probably find it pays off to spend some money early in a patient’s life to keep him healthy when he’s older.

Save money with a unified system or universal health care, which creates an incentive for preventive medicine, at the expense of profit?  America says, no thank you.

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