Our Broken Health Insurance

The health care system of the United States is in serious trouble. Nearly forty-six million Americans (15.7% of the population) lacked health insurance in 2004, the last year for which data are available, and probably more are uninsured today. A recent study by the prestigious Institute of Medicine estimated that 18,000 Americans die every year because they are uninsured and thereby lack access to health care. Despite the fact that many Americans lack access to health care, we spent over $1.9 trillion on health care in 2004 more than we spent on food, housing, transportation, or anything else—and the amount that we spend on health care is increasing every year at rates far in excess of inflation generally. Though most Americans are aware of these problems, many still believe, as our President has often said, that “we've got the best health care system in the world.”5 In other words, they believe that we still receive high quality health care. In fact, however, a series of studies over the past decade have shown that the quality of health care in the United States is seriously deficient, and, in particular, that medical errors are common and often have serious consequences. Indeed, the quality of the health care Americans receive is no better, and in some respects worse, than that provided in many other countries that spend far less on health care and yet provide it for all of their citizens.

In the meantime, health care costs will continue to soar, as a new Medicare drug program comes on line, as billions of dollars are dumped into the Medicare Advantage program, as employers continue to try to get out of the business of controlling costs, and as “consumer-driven” health plans result in consumers paying retail rather than wholesale prices for provider services. Congress may, after years of political battles, adopt caps on malpractice judgments and perhaps limits on contingent fees, but this will have no perceptible effect on limiting health care costs or expanding access. By the next election, we will, in all likelihood, have several million more Americans uninsured and health care costs that consume more of the gross domestic product than they do now.

When all else fails, we might try the obvious, that is, learning from the experience of other nations. Of course, that experience is mixed, but it tends to show that in this one particular corner of the ...