Is Tiering the Answer to the Current Health Care Crisis in America?

The Declaration of Independence, one of the cornerstones of our democracy, states that we have unalienable rights to “life, liberty and the pursuit of happiness”. If we still consider this to be the case, a corollary to having life is having access to health care. But many can’t afford that health care. The Affordable Care Act was meant to help our countrymen purchase it. But it has clearly fallen short. It leaves, unprotected, much of the middle class. Even with subsidies, health care has simply become too expensive.

One solution which has been broached is that of a universal health care program for all; essentially a Medicare for all. But with health care costs spiraling out of control, it is difficult to imagine what this would do to the national debt. Just ask some of our neighboring countries. But is there room for a tiered system of benefits?

Many rail against tiering, claiming that health care benefits should be equally available to all. That it is un-American to provide different levels of service based on an ability to pay. And yet, isn’t that what our current Medicare system does? Medicare only pays for 80% of a patient’s expense. Leaving it up to the individual to decide whether he can afford to take his medications or get his required therapy. Those whose retirement nest egg is large enough, can buy additional insurance plans which pick up the remainder of the costs. And, of course, we see it in other areas of our lives. Some can afford basic transportation, the Volkswagen Bug of old, while others can enjoy the luxury of a Mercedes, Audi or BMW.

But if life and health are to be considered unalienable rights, shouldn’t everyone be entitled to good health care? Absolutely. But are there extras we have come to expect, that may not be essential? Should we return to wards in the hospital setting, accommodating 6 to 10 patients, instead of the current semi-private or private rooms that have become the norm? Is it important that all elective surgery occur immediately when, by waiting, the current number of specialty surgeons can be more efficiently scheduled? Does everyone need to have multiple confirmatory tests for their diagnoses, when one or two are sufficient?

Clearly this is something that the UK has had to address. They have a basic tier of health care which is available to all. But the population can purchase supplemental insurance which can tailor the care to one’s wishes. Does this smack of elitism. I suppose that it does. But it depends on your priorities. At worst, even if health care is not a priority for you, you will be entitled to a basic level of services. Which is all we can truly expect from our taxes or our government.

But doesn’t the present system provide these basic services to everyone? I don’t see hospitals turning away the sick. Why should I pay for insurance to get what my neighbor gets for free?

A good question. And I suppose that this is at the crux of the matter. Our hospitals are currently required to provide “free care” to all those who present to them for care, who require it. And this mandate has resulted in the shuttering of many hospitals in recent years, whose bottom lines have not been able to support this benevolence. If we continue on the current trajectory, we may find, within another decade, that we have no safety net left for the uninsured.

But what about the cost? How can our economy afford taking care of its sick? Won’t the same economic forces threatening the closures of our hospitals, threaten the solvency of our country?

The short answer is yes. Unless we can rein in the costs of that care. Something that policy wonks have been struggling with for years. But what costs are we talking about? Medical tests have certain expenses associated with them which dictate their costs. Physicians are forced to adjust their fees to compensate for astronomical fees associated with their education. At present we have no ability to limit our exposure to the escalation of drug costs. And hospitals are confronted with the brick and mortar costs of their buildings and the attendant costs of staffing them.

So any solution to the current health care crisis must include an examination of the costs of the current system and how to modify them. Currently the price tag in its present iteration is 3.2 trillion dollars per year. Next time we will consider a couple of radical approaches that could be considered in devising a solution.