The Meaning of Health Insurance
Last year I got a rather large and painful cyst on my neck. Since I didn’t have health insurance, I went to a Seattle walk-in clinic to get it checked out. The fee for the 10-minute appointment was $250. When I told them I didn’t have insurance and asked if I could pay cash, they instantly dropped the fee to $99.
This got me thinking. Throughout our depressing health care debate over the past year, I find it curious that no one has really asked, “What, at a fundamental level, is the nature of insurance and the scope of its proper function?” Both sides seem to take it for granted that any and all medical services rendered should be paid for through an insurance scheme of some sort. But it’s curious that we don’t do this for any other sector of the economy! We purchase car insurance for protection against accidents, but we don’t make a claim when we need a new car, and we don’t call our broker when we need an oil change.
What exactly is insurance, and what should it be for? Isn’t it something purchased with ordinary income to hedge against extraordinary expense? Something purchased to allow the ubiquity of the ordinary (everyday healthy life) to overwhelm the occasional extraordinary (illness) by spreading risk across a pool of persons? Why the hell should all health care fall under that regime? Surely basic services – checkups, prescriptions, blood work, chiropractic, physical therapy, etc – can be rendered competitively on a strict fee-for-service basis?
Thus I tentatively favor a two-tiered health care system. For hospitalizations, chronic and debilitating illness, surgery, and emergency care, etc…I favor a nationalized, single risk pool, single-payer system in which citizens are covered by virtue of their citizenship and where public taxes pay private health care providers for services. It is a matter of human rights that ability-to-pay not determine access to life-saving or long-term care. But for more basic, everyday care, why not forego the administrative nightmares of insurance entirely? Why not, as I did last autumn, just pay up front and save big?