Health Care Wonkiness

Matthew Yglesias muses on the relative demerits of universal health care coverage, and kinda-sorta offers a compromise:

One way or another, in other words, if we aren't going to try to have a free market in health insurance then we're going to be relying on the idea that we can have an adequate level of accountability through the political system. There's reason to be skeptical about politics' ability to deliver in the right ways, but the whole case for universal health care programs is founded on solid evidence that market accountability doesn't deliver socially desirable outcomes on the health care front. Having politicians create a pseudo-market that's highly distorted by mandates, regulations, and subsidies is counting on politics to deliver the good every bit as much as a single-payer system would. ...

The other is that you can hybridize single-payer and market elements. Make preventive medicine free. Make it less than free -- have nurse practitioners kicking down doors and immunizing children. But for other things, you can implement cost-sharing that's scaled to the recipient's income. You guarantee that lack of funds never forces anyone to go without care, but you also ensure that everyone has an incentive to at least think a little about whether or not he really needs treatment. See Jason Furman's paper on cost-sharing and then imagine that all costs not borne by the individual would be picked up by the government. That gives you some market pressure, but also substantial equity because price-to-consumer is determined by ability to pay in a way that ensures that struggling families aren't left out in the cold.

I'm not really sure how we can institute a system that can "guarantee that lack of funds never forces anyone to go without care, but you also ensure that everyone has an incentive to at least think a little about whether or not he really needs treatment" since the only way I know how to do that is through the price mechanism (or rationing-by-government-dictate, but in that case there's no choice at all for the individual). But ignoring that, his preferred plan sounds like something close to the "Jane Galt Health Care Plan," to which I (basically) subscribe:

Have the government pay for all health care expenditures above 15% of adjusted gross income, and cover 100% of health care expenditures by people living under 200% of the poverty line.

I'd like to see the two of them discuss this (Bloggingheads?!?) in a bit of depth, and see if they can reach some sort of resolution.