By JOSEPH S. SPOERL
August 14. 2017 10:27PM
In last week’s column, Grant Bosse suggests that the problem with health care in the U.S.A. today is too much government intervention. Citing problems with the V.A. and Obamacare, he writes: “Whatever government touches ends up taking longer, costing more, and delivering less than the private sector. Why would we want government to control more of our health care?”
Let’s remind ourselves of the problems inherent in a purely free-market, private-sector approach to health care (which Bosse presumably was not advocating). In a pure free market, insurers have no incentive to sell affordable insurance to the elderly, the poor, the disabled, or those with pre-existing conditions. Moreover, the profit motive often leads providers to give unnecessary care, since they get paid for the care whether patients need it or not. So, the question is not whether, but how, the government should intervene to ensure a health-insurance market that meets the needs of society.
Bosse unhelpfully lumps together the V.A., Medicare, the British National Health Service, and Obamacare, when in reality these represent several distinct ways in which government could exert control over health care.
In fact, we can get a good sense of how “Obamacare,” done right, could work, by looking at the Netherlands. In the Netherlands, everyone is legally required to purchase health insurance from private insurers. Insurers have to accept all applicants, and people have the right to change their insurer each year. Everyone gets the same basic coverage, defined by law, and everyone with the same insurer pays the same premium, regardless of age or health status. Subsidies based on income ensure that everyone can afford the premiums. Everyone pays the same deductible of 375 Euros per year (about $440).
Dutch primary-care physicians are not government employees (unlike our V.A.), but work independently or in small physician-owned partnerships. Patients have complete freedom in choosing their own primary-care doctor, but must be referred by their primary physician to get access to a specialist. Dutch hospitals are private and nonprofit (again, not government-run, unlike our V.A.). The Dutch Health Care Authority is responsible for ensuring that the health insurance and health-care delivery markets work smoothly, e.g. by setting the prices for 30 percent of health-care treatment combinations (the balance of prices are set in negotiations between insurers and providers).
How well does the Dutch system work? In 2013, the Dutch spent 11 percent of their GDP on health care, compared to 17 percent in the U.S.A. Adjusting for differences in cost of living, this came to $5,131 per capita in the Netherlands, compared to $9,086 per capita in the U.S. In the Netherlands, everyone has good health insurance, while in the U.S., millions lack it (even more before Obamacare).
Life expectancy at birth is 81.4 years in the Netherlands, 78.8 years in the U.S. Infant mortality in the Netherlands is 3.8 per 1,000 live births, compared to 6.1 in the U.S. In the U.S., bypass surgery costs $75,345; in the Netherlands, only $15,742. In the U.S., an appendectomy costs $13,910; in the Netherlands, $4,995. The average Dutch person sees his or her doctor 6.2 times per year, the average American only four times.
I have traveled numerous times to the Netherlands over the last 18 years, both for work and to visit friends. Everyone I meet is quite happy with the quality of health care. On our most recent visit, in July 2017, my wife became very ill and had to be rushed to an emergency room. She received excellent care at a modern, gleaming, well-run, Catholic hospital. The ER visit, lab tests, and prescription cost us a grand total of 285 Euros, or about $335. The care compared very favorably to any ER in the U.S., and at a much lower cost.
American policy makers need to look carefully at the masses of data documenting how different national health care systems work; the Commonwealth Fund website is a good place to start. The Dutch model suggests that a smart version of Obamacare, with the right kind of partnership between private and public sectors, can achieve very good results.
Prof. Joseph S. Spoerl is chair of the Philosophy Department at Saint Anselm College.