Monday, September 24, 2007

A Medical Security System--For Everyone

Laurence Kotlikoff, an economics professor at Boston University, has a proposal for universal health care that overcomes shortcomings he sees in "the piecemeal reforms that President Bush, most of his would-be successors and our state governors are advocating."

Below are the closing paragraphs of an article that first appeared in the Boston Globe on August 28th. The Houston Chronicle reprinted it on September 23rd, but without proper attribution to the Boston Globe. The complete original is at

We are all uninsured now

My solution is called the Medical Security System. It would eliminate Medicare, Medicaid, and (by dropping the tax breaks) employer-based healthcare. The government would give everyone a voucher each year for a basic health plan. The size of the voucher would be based on one's health status. Those in worse health would get bigger vouchers, leaving insurers no incentive to cherry-pick. Furthermore, insurers would not be permitted to refuse a voucher or otherwise deny coverage.

The government would set the total voucher budget as a fixed share of gross domestic product and determine what a basic plan must cover. We would choose our own health plans. If we cost the insurer more than the voucher, he would lose money. If we cost him less, he would make money. Insurers would compete for our business and could tailor provisions, like co-pays and incentives to stop smoking, to limit excessive use of the healthcare system and encourage healthy behavior.

Nothing would be nationalized. Virtually all of the cost would be covered by redirecting existing government healthcare expenditures as well as tax breaks. Doctors, hospitals, and insurers would continue to market their services on a competitive basis.

This is not a French, British, or Canadian solution. It's an American, market-based solution that Republicans should love. It's also a progressive solution that Democrats should love. (Democratic presidential candidate Mike Gravel has endorsed it.) The poor, who are, on average, in worse health, will receive, on average, larger vouchers. The rich will lose their tax breaks.

Why can't a country as rich as ours come up with a system that works? This, in essence, was Justice O'Connor's parting question.

But, in fact, we can. Now if we can just get the big cheeses in the Oval Office or on their way there to start thinking big . . .

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