By E.D. Kain for Forbes –
Nearly every country in the developed world has some form of universal access to health insurance. The glaring exception to this rule is the United States. As a proponent of free markets, I find this to be a glaring failure on the part of American policy makers and business leaders.
So we see Occupy Wall Street rallying for healthcare reform, where healthcare workers ”joined the Occupy Wall Street protesters Sunday to rally for health care reform, and tourists continued to funnel in and out of Zuccotti Park to witness the demonstrations for themselves” featuring ”speakers demanding significant health care reform across the country.”
This is a natural and frankly long overdue reaction to the way capitalism works – and doesn’t work – in America.
Beyond the inherent humanity of providing services for those who cannot provide them for themselves, the purpose of safety nets is to enable capitalism. Without a mechanism to stabilize the human cost of market failure, public opinion will turn against a market economy. People will clamor for command and control, for stability, for guaranteed wages and price freezes – for disaster, if truth be told.
Many would argue that the problem with our system is that it’s not a system of safety nets, but rather a system of entitlements for the middle class. This sort of thinking is basically pity-charity liberalism. The idea that we should slash back all services to simply cover the poor in order to save money may sound good on its face, but the lack of universality makes these poor-only programs politically vulnerable. Medicaid faces the chopping block before Medicare because it is largely a pity-charity program geared toward the poor rather than the broad middle class.
Just as importantly, the nature of healthcare costs lends itself to large risk pools. A single-payer healthcare system works so well because there is one very large risk pool with an enormous amount of bargaining power. You can’t match that bargaining power in a fragmented system like the one we have, comprised of myriad regional insurers with de facto monopolies over their area.
Of course, the problems with our healthcare system gouge much deeper than that, and there are many ways you could improve upon the status quo. Some combination of market reforms to loosen up the supply and increase access to providers, coupled with a single-payer insurance framework or even a system of HSA’s and universal catastrophic would be a major leap forward.
In any case, the lack of universal access to healthcare in this country actually hampers business. It makes capitalism more risky for workers, and the cost of healthcare weighs down workers and businesses. The economic cost is huge, and makes American firms less competitive and American workers less secure.
Occupy Wall Street protesters demanding a change to this abysmal system are right. It’s long past due. As more firms shed benefits – such as Wal-Mart – this issue becomes even more important.