There’s a new book out titled The Healthcare Fix: Universal Insurance for All Americans by Laurence Kotlikoff. Laurence is a professor of economics at Boston University and a leading scholar on the generational accounting of social security. Laurence has written extensively about the probability of a bleak economic future for the United States without tax reform, health care reform, and Social Security reform.
None of this comes as a surprise to most of us. What do we do to change our future? We go to Starbucks, order a coffee, and sit down with our friends and lament about the future. We do that because we feel confident that our leaders will take care of the problems. Meanwhile lobbyists are feeding the self interest giant in Washington at a rate that will crush us all. Our leaders don’t know we’re paying attention because, for the most part, there are no repercussions for their actions.
That’s why we have the right to vote. If our political leaders thought someone was actually holding their feet to the fire, they might respond appropriately but we don’t understand the problems and we don’t know who’s telling the truth. Therefore, we don’t know which solution makes sense. Many of us vote but for the most part we’re not informed voters.
We can also reach business leaders if we stop buying their products. Unfortunately there are some products important to us that you and I don’t personally buy but we pay for. Health insurance is an example. For those of us who work for a company that provides health insurance as a benefit and most of us do, the company purchases our insurance. Those of you who think you don’t pay for that benefit, please raise your hand. If your hand is in the air, you need a reality check soon.
If you think health insurance is too expensive, you’re right. Employers are looking for ways to cut back on insurance costs but their hands are tied. We don’t respond well to fewer benefits or no benefits any better than we respond to our employer reducing our pay or not giving us an annual raise. The best way to reduce the cost of something is to switch to another product. For an employer with many employees, that’s a daunting effort. For us as individuals, it’s much easier. If we were buying our own health insurance, the GEICO gecko would be selling health insurance and many of us would be switching.
Part of the GEICO philosophy is “We keep costs as low as possible so we can pass the savings along to our customers. We're always looking for better, faster, more efficient ways to conduct our business.” Imagine having a health insurance company that operated with that philosophy. I know the health insurance companies don’t keep their costs low because the administration costs in the health insurance industry are higher than the administration costs in Canada and we know how efficient bureaucracies are.
Okay, back to the book, The Healthcare Fix: Universal Insurance for All Americans. Kotlikoff recommends that we kill Medicaid and Medicare and use the money to provide us all with vouchers to buy our own insurance. I haven’t read the book yet so I’m not sure if he’s talking about just the people on Medicare and Medicaid or if he’s talking about dismantling the entire employer based system. I’ll let you know.
I do know Kotlikoff advocates drastic measures. He says we like incremental changes but we don’t have time to make incremental changes. The only way we will get drastic changes is if our leaders in business and government get the courage to do it; the courage to do what’s right for this country. I’m not advocating any particular fix but I can’t wait to read his book. You might want to do the same. After all, you wouldn’t want to be uninformed.
None of this comes as a surprise to most of us. What do we do to change our future? We go to Starbucks, order a coffee, and sit down with our friends and lament about the future. We do that because we feel confident that our leaders will take care of the problems. Meanwhile lobbyists are feeding the self interest giant in Washington at a rate that will crush us all. Our leaders don’t know we’re paying attention because, for the most part, there are no repercussions for their actions.
That’s why we have the right to vote. If our political leaders thought someone was actually holding their feet to the fire, they might respond appropriately but we don’t understand the problems and we don’t know who’s telling the truth. Therefore, we don’t know which solution makes sense. Many of us vote but for the most part we’re not informed voters.
We can also reach business leaders if we stop buying their products. Unfortunately there are some products important to us that you and I don’t personally buy but we pay for. Health insurance is an example. For those of us who work for a company that provides health insurance as a benefit and most of us do, the company purchases our insurance. Those of you who think you don’t pay for that benefit, please raise your hand. If your hand is in the air, you need a reality check soon.
If you think health insurance is too expensive, you’re right. Employers are looking for ways to cut back on insurance costs but their hands are tied. We don’t respond well to fewer benefits or no benefits any better than we respond to our employer reducing our pay or not giving us an annual raise. The best way to reduce the cost of something is to switch to another product. For an employer with many employees, that’s a daunting effort. For us as individuals, it’s much easier. If we were buying our own health insurance, the GEICO gecko would be selling health insurance and many of us would be switching.
Part of the GEICO philosophy is “We keep costs as low as possible so we can pass the savings along to our customers. We're always looking for better, faster, more efficient ways to conduct our business.” Imagine having a health insurance company that operated with that philosophy. I know the health insurance companies don’t keep their costs low because the administration costs in the health insurance industry are higher than the administration costs in Canada and we know how efficient bureaucracies are.
Okay, back to the book, The Healthcare Fix: Universal Insurance for All Americans. Kotlikoff recommends that we kill Medicaid and Medicare and use the money to provide us all with vouchers to buy our own insurance. I haven’t read the book yet so I’m not sure if he’s talking about just the people on Medicare and Medicaid or if he’s talking about dismantling the entire employer based system. I’ll let you know.
I do know Kotlikoff advocates drastic measures. He says we like incremental changes but we don’t have time to make incremental changes. The only way we will get drastic changes is if our leaders in business and government get the courage to do it; the courage to do what’s right for this country. I’m not advocating any particular fix but I can’t wait to read his book. You might want to do the same. After all, you wouldn’t want to be uninformed.
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