National Health Insurance Would Be Cost-Effective

One of our nation’s greatest shames is our health-care system. We spend hundreds of billions of dollars on health care while neglecting the basic health needs of millions of Americans. When will we wake up to the urgent need for a more rational, less wasteful and more equitable health-care system?

Fortunately, a growing majority of people is beginning to favor dramatic changes in our health-care system. I support that inclination with an argument that national health insurance would make good economic sense and, quite likely, promote better health.

Some of the sources of discontent with the health-care system are familiar. In 1986, for example, 38 million Americans did not have any insurance coverage--public or private. Children comprised more than a third of this uncovered population.

It has become worse during the slash-and-burn years of right-wing policies in Washington. Between 1980 and 1988, the number of people without health insurance increased by 4 million. The number of Americans who do not have a regular source of care increased by 65%.

Some of these problems have arisen from the trend toward a profit orientation in the health-care system. While other countries regard health and health care as a public good, the United States has been moving toward a system in which health problems provide an opportunity for private business to turn a tidy profit.

In 1986, for example, 78% of admitting physicians reported pressure from their hospitals to reduce patients’ length of stay, especially patients whose problems were considered “unprofitable.”

Despite its failure to care for vast sectors of the population, the U.S. health care system is extravagantly expensive. Private and public health expenditures in the United States in 1986 constituted 11.1% of gross domestic product, or $1,926 per person per year.

No other country came close in per-capita expenditures: Canada, Switzerland and Sweden, the runners-up, spent $1,370, $1,217 and $1,195 per capita, roughly two-thirds the U.S. figure. We in the United States--through our medical insurance bills, our taxes and our payments to medical personnel and institutions--paid top dollar. What did we get in return?

Judging by standard health statistics--infant mortality and life expectancy at birth--not much. Far from enjoying a substantial lead over industrial economies paying substantially less for health care, the United States comes in close to last. Thirteen countries had lower infant mortality rates in 1988; 12 had higher life expectancies at birth.

The comparison to Canada is particularly instructive. As we have seen, Canada spent $1,370 on health care in 1986, two-thirds of the U.S. figure. The government funded 76% of Canadian health expenditures. The country’s infant mortality rate in 1988 was less than two-thirds that of the United States, while life expectancy at birth was two years greater. Canada trailed the United States in both these categories before the mid-1960s.

How did Canada overtake the United States in these health-status measures while spending much less per capita? In 1966, Canadian health expenditures as a fraction of gross national product were identical to those of the United States, and both were rising. In that year, Canada introduced a national health program that made federal and provincial governments responsible for the medical insurance of the population. The federal-provincial health insurance system contracts with the private sector for delivery of services. A wide range of recent studies attribute improvement in the effectiveness of the Canadian system to this fundamental change in the orientation of public policy.

These are comparisons based on “objective” indicators. The subjective evidence also supports these comparisons: The Canadians and the British like their systems better than we like ours, according to respondents answering questions about the degree of satisfaction with hospital stays and doctor visits in a 1988 survey comparing the Canadian, U.K. and U.S. systems.

And while Canadians and the British prefer their own systems over either of the other two by wide margins, those surveyed in the United States overwhelmingly preferred the Canadian system to that prevailing in the United States in the late 1980s.

There is no reason--other than the power of those who profit from the status quo--why the United States could not have a system similar to Canada’s.

Not surprisingly, large majorities of people in the United States favor fundamental change in the health-care system. In the same 1988 survey, for example, 60% of respondents in the United States agreed that “fundamental changes are needed to make ‘the U.S. health-care system’ work better,” while another 29% agreed that “our health-care system has so much wrong with it that we need to completely rebuild it.”

Only 10% agreed that “only minor changes are necessary to make it work better,” while only 1% of respondents were “not sure.”

In another recent survey, 75% of respondents wanted the government to establish a national health program.

Based on per-capita expenditure, if the United States had had the Canadian system in 1989, we would have spent $138.1 billion less on health care. That would have been a savings of 2.6% of gross national product.

People speak about the possible “peace dividend” that may result from a thaw in the Cold War. The “national health-care dividend” could be just as large.

Those of us who favor more decent social policies in the United States are confronted with a persistent refrain: Such policy changes would cost too much--we can’t afford them.

The case of health care turns that familiar refrain on its head. We could enjoy better health care in this country and pay less for it at the same time. Now, more than ever, it’s time for a universal national health insurance system in the United States.