Sunday, March 23, 2008

Insurers and Single Payer Insurance

Yesterday we overviewed my vision for a regionally-impelemtned single payer program. Today I'd like to take a moment to talk about the role of health insurers in a single payer system.

Private insurers will still have the ability to offer insurance to those that can afford it or have employers who choose to offer it. This would certainly be a reduced pool of potential customers, which leads us to our next point.

First, and perhaps most importantly, I don't envision any single payer national health program as being mandatory. While some might argue that a mandatory program would ensure similiarity of care and keep the best providers from simply continuing to deal with those that are privately insured, I would respectfully suggest that health care providers are far more interested in providing care to those that can provide the most efficient profits, not just serving the wealthiest clientele. Layers upon layers of bureaucracy within insurers eat into their profits and hinder their ability to serve. There's no reason to believe they would not be just as willing to forego those nusances as the public would be to get their health care without them.

Under a national single payer program I see the insurers participating in a number of ways:

  • Serving as contractors to process reimbursements, a skill which many are expert at and in fact could enhance the regional concept I proposed yesterday. Numerous regional insurers could leverage existing relationships with providers and cut overhead no longer needed under a single payer system.
  • Continuing to offer supplemental insurance for elective procedures, which can be among the most profitable for providers (and insurers who sell such insurance).
  • Managing Medical Savings Accounts. This segue into the finance arm of health care is natural for insurers, who can surely innovate new ways of offering MSAs that benefit the consumer.
  • Providing low-cost options to compete with a single payer system. This may seem contradictory to my earlier suggestions but far from it. Private industry competes with government service in many ways when there are profits to be made, and instituting a single payer system could entice insurers to develop new low-cost insurance that doesn't exist right now. This could lead to higher volumes and more profits.
Just a few thoughts this Sunday. I look forward to your feedback as we continue to explore this fascinating topic.


Julie Pippert said...

I think I missed earlier posts in this series. The supplemental plan seems to work fine in GB, for those who can afford it.

le35 said...

This plan seems to be shaping up to be able to work in our society. However, I think that one thing people would say is if you have a single payer system, what about the people who can't pay anything for coverage now? How does that affect the rest of us? Great topics, Todd

Robert said...

I continue to be intrigued by your proposals. I am all for simplifying and streamlining to reduce waste on bureaucracy. I'm all for something that leaves competition and market dynamics in the system (without those forces, the attraction to the field of medicine would grow dimmer). I want some clarification on some of your viewpoints, but overall it sounds like a good system you've proposed. Unfortunately, a lot of things sound good that turn out to be very poor ideas (read: social security, welfare, communism, et al).

le35 said...


It's interesting to me that when you say "Social security, welfare, and communism, et al" You don't just assume that the second is an iteration of the third. That interests me.