In The Atlantic, David Goldhill offers a solution to reform the way health care is paid for. The article is lengthy, perhaps flawed in some of the specifics (particularly the attempts to apply standard economic models to health care and in overstating the death rates due to medical error) - but at the end of the day offers a tractable and thoughtful remedy.
He proposes a move away from comprehensive health insurance as the single model for financing care. In addition, he includes indigent care and long term care in his plan.
He instead would make use of different sorts of financing for different elements of care—
- routine care funded largely out of our incomes;
- major, predictable expenses (including much end-of-life care) funded by savings and credit; and
- massive, unpredictable expenses funded by (catastrophic) insurance.
Under Goldhill's plan, every American would maintain an HSA, and contribute a minimum percentage of post-tax income, subject to a floor and a cap. All noncatastrophic care should eventually be funded out of (these) HSAs.
For care that falls through the cracks—major expenses (an appendectomy, sports injury, or birth) that might exceed the current balance of someone’s HSA but are not considered catastrophic - These should be funded the same way we pay for most expensive purchases that confer long-term benefits: with credit. Americans should be able to borrow against their future contributions to their HSA to cover major health needs.
Here's Baucus' plans for revenue generation. Sure looks like a tax bill, doesn't it. Particularly onerous is a proposed removing punitive damages payment as a deduction - essentially kicking south of the Mendoza line before robbing the bank.
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