Nancy Pelosi is cited as having put forth 47M as the number of health-care uninsured in America. Who are these these people, how many will directly benefit from a given health care reform notion, and how will the "general welfare" be effectively promoted thereby?
Let me first look at a purely economic analysis. I do this partly because it's easier in principle to quantify economic matters (as opposed to say spiritual or intangible matters), and partly because a main concern is fiscal or financial - who will pay how to whom for what expected benefits? In addition to ignoring spiritual matters, this review does not deal
with plausible Constitutional issues (such as some folks claiming
health care as a right while others see it as something outside the proper scope of USA government).
Health care reform advocates promote two kinds of economic benefit: These people will get health care for diseases or conditions which currently disable them (short term like flu or long term like diabetes). Reducing disability generally has the effect in principle of increasing effective ability and thus potential productivity, too. That means they can do better work as workers, assuming they have jobs. One could then do a cost-benefit analysis to determine a global measure of effectiveness for the proposed specific reform. If the plan costs $100B/yr then we have a first order decision point -- if the net benefits are less than that, it pays back less in terms of increased output than we invest into it. That would be an economic failure, whether marginal or worse. If it instead pays more, we can say that it is at least a marginal plus. And if it pays back say $200B/yr it should be considered a wild success. It helps both the individual (at least in the collective sense) and the economy at large (which presumably helps economic leeches such as government employees paid by taxes on economic output). Of course there could be transition costs in addition to annual costs, but those could be amortized (annualized) rationally in a medium or long term picture.
The second kind of benefit promoted is a negative benefit in this sense: Reducing the number of uninsureds cuts down on publicly subsidized health care costs mandated by law or conscience. This presumably then frees up cash flows to be spent otherwise. That is, the current system has a lost-opportunity cost to it, one which might be significantly reduced by the proposed reform. That then would be an implicit benefit to those who subsidize things like ER care for indigents. If we have good data on the status quo we can make reasonable inferences as to how a given reform program would perform on this aspect.
Now, what about the realities? Is there clear-cut status quo data?
Who are these 47M? Some quick stats (and these numbers may overlap) --
9.5M are non-citizens
17M have plenty of income to buy basic health care (or are dependents in such a household)
18M are 18-34 and not necessarily in need of significant health care coverage or just choose not to get it.
Of those under 65, 70% who lost insurance regained it within a year, and 50% within 4 months.
How many "indigents" receive what benefits now at a cost to the public (whether via government or NGO charity)? How would that change?
What reasonable projected benefits and costs can we expect, and what is the reality of the status quo? This of course applies not only to the 47M but to the system as a whole.
If we consider that health care is currently rationed partly by price (one can buy levels of coverage) and partly by access (waiting lines, "preferred providers", denial of coverage), how would the proposed reform ration it? Would the reform affect quality of care separate from those considerations (competence of providers might go up or down, for instance)?
Previous blogs by me on health care:
Is it too late to reform health care reform? February 26, 2009, 2:41PM
Rationalizing the Health Care Debate March 6, 2009, 9:51PM