Universal Health Care Vouchers

The June 2005 edition of Washington Monthly is out. In this edition is a piece called Solved! by Ezekiel Emanuel and Victor R. Fuchs. Emanuel and Fuchs advocate the implementation of Universal Health Care Vouchers (UHVs) to fix this nation's health-care system. They argue that UHVs would expand coverage to all Americans, reduce costs, and be politically viable to implement and manage.

How would it work? According to Emanuel and Fuchs,

Every household in America will receive a voucher entitling its members to enroll in a private health plan of their choice. All plans will be required by law to guarantee the basic features of what most Americans now receive from their insurers: doctors' visits, hospitalization, pharmaceuticals, and catastrophic coverage. These insurance policies will not cover everything. Viagra and cosmetic surgery will not be included, but Americans will still be able to purchase them and any other service or care with their own money.

The actual provision of health care would not change for most people.

The greatest change will not be found not in the doctor's office, but in the workplace. Employer-based insurance, with all its inefficiencies and inequities will disappear. Workers will have the freedom to switch jobs, try self-employment, or drop down to part-time work without losing health coverage. Not only will “job lock” disappear, but so will “wedlock” when men and women stay in marriages they would rather be out of because of health-insurance needs. Employers will also be free to hire workers without considering how much they may add to the health-insurance bill.

Emanuel and Fuchs propose that the system be financed with a Value Added Tax (VAT), or essentially a sales tax. They argue that the VAT would be "efficient, easy to administer, (would) spread the tax burden broadly, and encourage savings." They feel that political objections to the VAT from both left and right can be overcome. Objections regarding regressivity can be overcome by excluding essential items, such as food and utilities, from the base. Objections regarding any higher taxes can be overcome by pointing to polls indicating that "many Americans are willing to accept higher taxes in exchange for guaranteed health care."

UHVs would be administered by a Federal Health Board (FHB), similar to the Federal Reserve Board. The FHB, like the FRB, would be insulated from politics. It would also reduce bureaucracy because it would be taking on many administrative tasks now handled by state agencies and insurance companies.

Emanuel and Fuchs feel that the politics of UHVs work well. Insurers could support the concept because they remain in place with the addition of 45 million currently uninsured Americans added as paying customers. Doctors and other health care providers would support the reduction in costs from administration and charity care. Business and other organizations would support the reductions in annual cost increases.

The authors feel that their solution is "an answer with a chance of succeeding."

See this previous post.

Comments

[Insurance Guy]

While this seems like the ultimate compromise to some, I personally, don't see it that way. This idea would get too much opposition from the conservatives, because it still ultimately takes the business out of health care. At this point I feel that universal health care will be impossible unless public perception changes.