It’s common knowledge that healthcare in America is unaffordable, and politicians are always talking about ways to fix that. Unfortunately, their plans are always confusing and often misleading. The problems isn’t that complicated though, and there are some relatively simple solutions that deserve to be discussed.
The root of the problem (that politicians almost never mention) is that hospitals price gouge their customers. This is the only reason health insurance is necessary. If prices weren’t inflated beyond affordability, there would be no reason to pay insurance companies to protect you from them.
The reason politicians never promise to simply make price gouging illegal is because hospitals would immediately point out that they have to pay ludicrous prices for medical equipment, and doctors have to pay unreasonable prices for medical school. This raises the point that medical equipment and medical schools are also price gouging their customers.
If we passed a law that prevented those businesses from price gouging, they would point out that the businesses they depend on are price gouging them. If we follow the rabbit hole all the way down, we’ll have to admit that the entire economy revolves around businesses gouging their customers.
You could take this as evidence that humans are inherently greedy and evil, or you could take it as evidence that the standard business model is inherently flawed.
The purpose of owning a business is to make a profit, and the formula for profit is “revenue minus costs.” So to make the most amount of money, you have to provide your customer with the cheapest goods and services possible while charging them as much as possible. And we justify gouging customers for cheap goods and services by saying that the value of goods and services is equal to whatever a person is willing to pay for them.
This is easily true when determining the price of bananas or a piece of modern art, but it becomes a recipe for exploitation when determining the price of cancer treatment.
If you need a good or service in order to survive, then of course you’re going to pay whatever you have to. But if you have to pay $3,000 for insulin that costs $50 to produce, and you don’t have $3,000, you’re going to die because your ability to pay didn’t meet your provider’s ability to exploit your need. The value of insulin wasn’t really $3,000. That was just the value your provider could get away with exploiting you.
Fixing this problem would require putting profit caps on businesses or income limits on business owners, but that’s never going to happen in my lifetime because predatory businesses have the money to legally bride politicians with campaign donations and lobbying to prevent comprehensive anti-price gouging laws from getting passed.
Ultimately, profit/income caps are the truest solution to the root of the problem of unaffordable healthcare. Short of that, there are other second-tier solutions.
Adding more regulations to private insurance is not one of those solutions. Insurance companies are required by the law of supply and demand to provide the least amount of benefit to their customers while simultaneously charging the highest prices people are willing to pay to survive. So they will always try as hard as possible to do what’s in their best interest, which is inherently in the worst interest of their customers.
If health insurance must exist, the best course of action is to nationalize the insurance industry completely. In other words, the government is the only insurance company, and they only have one plan that everyone can afford. They don’t need to make a profit, and whatever profit they do make can go directly into the government coffers to be spent on public services. You could even just roll the cost into basic taxes so you don’t even have to apply for it or have an insurance card.
In America, this is basically “Medicare for all.” Granted, I don’t trust the American government to implement this system as simply and efficiently as it could be. Having said that, you should be asking, “If you don’t trust the government to do this right, then why trust the government to do it at all?” My reply would be that I trust private predatory insurance companies (whose profit margin depends on providing life-threateningly poor service) even less.
In a perfect world, we would just nationalize the entire medical industry and take away the need for health-related businesses to make extravagant profits. But we live in a bureaucratic world where egos, careers, and paperwork are more important.
Most Americans don’t know this, but New Zealand found a decent compromise. They don’t have “socialized healthcare” per se. They have “subsidized healthcare.” This means doesn’t totally control the healthcare industry. You pay a little extra in taxes, and the government uses that to cover the costs of the inevitable markups doctors and hospitals are going to charge. In practice, this means seeing a doctor always costs $30-$50, and your prescriptions always cost $5-$15. Healthcare providers always make a profit, but they never eat you alive.
In New Zealand, you can still buy private insurance and see more expensive providers, but due to how the whole subsidized medicare system works, millionaires in New Zealand aren’t going to get as good of healthcare as millionaires in America, and New Zealand medical centers don’t make as many medical research breakthroughs as America’s over-funded hospitals because even though most of America’s healthcare funds get funneled into hospital owners’/investors yachts, a lot of that money still manages to find its way to research.
So if we have to make the most of a broken system that favors the rich, then perhaps the best course of action is to admit and embrace the fact that we have a classist system.
People who make less than $70k per year need reliable access to basic healthcare. So give them (which includes me) nationalized, socialized, or subsidized access to relatively shitty healthcare with (possibly) long wait times that guarantees we get can at least get something we can afford, and then make overpriced first-class hospitals mandatory for rich people where they don’t have to be inconvenienced with the presence of the poor. That would be a better and more honest system than America has now.
This isn’t the solution I want, but it’s one I’m willing to accept if we have to balance the needs of the many (surviving) with the needs of the few (profit). But I’d rather use this compromise to point out the absurdity of having to balance the needs of the many with the needs of the few.
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