But I also approach the subject of UHC with economic trepidation. With rising Medicare and Medicaid costs eating up more and more of our budget, we're looking at a total collapse of the system if drastic action is not taken. Regulating the insurance industry in such a manner without issuing an edict of direct government control that forces health insurance companies to exist as non-profit entities is only going to cause consumers to suffer higher insurance premiums and greater out-of-pocket expenses.
It was upon discussing this issue with those scurrilous bastards who label themselves as fiscal conservatives but whose practices involve cutting social services while channeling funds to the bloated, morally-questionable military-industrial complex when the solution came to mind. I was searching for a chart comparing health care expenditure as a percentage of GDP, and I found this:
And while I had known for some time that UHC is more effective at controlling costs than the private sector (at least with our modern convoluted mess of a health insurance system), it suddenly became clear to me that supporting UHC is fiscal conservatism. The two are not mutually exclusive; rather, they are folded in upon one another.
As previously mentioned, one of the greatest budgetary issues that the United States is facing involves Medicare/Medicaid (right alongside Social Security and Defense spending). But Medicare/Medicaid don't even cover the costs of all the population--they cover a section of the population. If we were to cover the entirety of the population with a like social program, wouldn't the required costs dwarf current expenditures? Such thinking is right on the surface, and one cannot fault fiscal conservatives from approaching the subject cautiously. But the answer lies within the chart.
How can it be that countries with provide health care for their citizens as a part of government spending manage to only spend, on average, a few more percent of their GDP on health care? A conundrum, but one easily explained.
First, there is the issue of competition and profit margin. I am far from one to say that doctors do not deserve to be compensated richly for their services, but the current way that health insurance exists does not work. Covering routine doctors' visits and medication results in excessive charges on the insurance companies, which, in turn, is passed on to the consumer in the form of higher premiums, copays, and deductibles. Compounding this is the fact that hospitals charge ridiculous amounts for routine procedures (if I recall correctly, an MRI costs approximately $1100 in the United States).
But why does this affect government spending? Because the government has to compete with these preposterous costs and pay out accordingly. Thus, the government is forced into a position where they are effectively subsidizing the medical industry, and there is no incentive for said industry to lower costs--when they're drawing from a pool of what is, essentially, unlimited money (in the form of government funds), they can charge whatever they want and get away with it.
If, however, we were to adopt a UHC system, the government could more easily adopt cost-control measures that don't involve denial of coverage or such unpleasantness. In doing so, the government funds would not have to compete with private sector prices, and the overall costs of health care would decrease (thus decreasing the percent of GDP spent on health care).
And, as already mentioned, government spending (as a percent of GDP) on health care in countries with forms of UHC is not significantly higher than government spending in the United States.
But that's not the ingenious part. That's the stale, boring part that economists have been quibbling about for ages. What is the part that really excited me was seeing the part of the chart that compared privatized costs. A sort of enlightening bolt struck me then. Privatized costs in countries with UHC are drastically lower than in the United States (both overall and as a function of GDP). This, in turn, leaves more money in the pockets of the citizens. And what do the citizens do with that money? Spend it frivolously on plasma televisions and iPhones! The simplicity astounds me. With more money in their pockets, consumers spend more stimulating the economy by purchasing goods and services. That boosts GDP, lessening the impact of government spending on total GDP. It's classic Keynesian economics wrapped up in UHC.
The proof is right there in front of us. UHC is fiscal conservatism. Yes, it will inevitably result in more government spending, but that is partially compensated by the increased GDP from consumption of goods and services. All in all, the moral and fiscal dilemma of health care in America can be solved quite simply.
