So, I’m not a fan of the health care plan that is moving through Congress.  If I truly removed myself from the politics of it, it’s because it’s going in the wrong direction (higher cost, less competition, not doing as much as it is intended to do).

If the goal is to help the unisured, then we should analyze why someone is uninsured right now in order to know what to do.

I can think of a few reasons right now:

• Unemployed/Underemployed and too little income
• Poor decision making skills (spending money in frivilous places)
• Pre-exisisting condition limiting coverage or increasing the premium
• In transition between jobs, or is currently seeking coverage
• Procrastination

I’m sure there are a lot more, and you could get really specific with the reasons (ex: I just lost my job, and Cobra payments are 5 times what I paid before).

Putting time into understanding why someone doesn’t have insurance will go a long why to reducing the number of uninsured, instead of creating a blanket coverage program that will cost tax payers significantly more (and still doesn’t cover everyone).

Let’s look at a few of these reasons and possible solutions.

So, let’s take a guess that the main reason people don’t carry insurance is the cost factor.  Someone in their 50’s who doesn’t qualify for Medicare could pay $500-$1,000 a month for coverage.  However, someone in their 20’s might only pay $150-$200.  I think we should also assume that those without coverage are generally lower wage workers, so age wouldn’t mean more income necessarily.

The older uninsured in this situation are facing high costs, but want to be insured.  Since they can’t find affordable options, they get nothing.  The younger uninsured often just don’t want to spend the money on insurance.  They feel healthy and don’t think it’s really worth it.  Many in this situation could afford it, but don’t want to pay for it.  There are many also who are underemployed (i.e. minimum wage jobs), and they can’t afford the insurance.

What would be a good solution?  If we’re looking at government provided health care anyway, why not provide a voucher.  Now, to be fair, this voucher really should go to every person, not just those without insurance.  You could base it on age, so those in their 20’s only get, say, $100.  Those in their $50’s might get $400.

The advantage is that you’re still relying on the private system instead of government to create competition.  I think most people would agree that government rarely does a good job at much of anything other than the military, so I’m assuming that we would agree that keeping insurance private is a better deal for everyone.

A second advantage with this plan is that it keeps the customer with some skin in the game.  They’re paying for some of it.  It may only be $50, but it’s still something, and people tend to be more careful when they have to pay out of pocket.

Also, it gives the customer a lot of choices.  They could pick a plan with a high deductible and only have to pay $25 a month.  They could shop around and someone may start offering coverage that even comes under the voucher limit and pay nothing.   They could decide to eliminate drug coverage if they have no chronic illnesses.  Basically, they could decide for themselves where they want to save money.

Still, this would get pricey.  If it averaged $200 a person for 300,000,000 people in US, then we’re looking at $720 billion a year.  Now, many of those are already on Medicaid, Medicare, and kids on S-Chip, so we could deduct some for those premiums and we’re looking at, say, $550 billion.  We could also require that states reduce their indigent care programs since we’re now insuring those who needed it before.  The states save money, and reduce taxes (ahem…yeah), and the feds could raise taxes slightly to move the money into their coffers instead (or require the states to contribute to the fund directly with no change in taxes).  So, we could potentially reduce it down to $450 billion.

While that’s still a huge number, it’s really not that far off from the current bill where the Congressional Budget Office is estimating a net loss of the mid 300 billion, after tax increases are applied.  And, throw in that we’re insuring everyone, not just the 30 million or so that the current plan would provide.

A second option would be just to simply extend Medicare to all ages.  There would have to be a lot in the way of defining who would qualify, but you could roll up all the existing state programs into it, and funnel the state funds into Federal coffers.  This is a simplified description of the solution, but a possibility.  Again, it’s better than the Feds creating a brand new program, and Medicare has defined what they insure already.  We wouldn’t need to wait for new pannels to convene and say what a new program will insure.

This is looking like it’s going to be a drawn out process, so I’m going to break this up into segments.