Robert Moffit is the director for the Center for Health Policy Studies at The Heritage Foundation in Washington, D.C.
There is no question the American health care system faces a serious problem with the rising number of uninsured Americans. All Americans should have access to affordable and portable health insurance coverage. But in order to solve the problem, the diagnosis has to be correct.
Families USA, a liberal-leaning health advocacy group in Washington, has traditionally argued for a greater government role in the health care system. Recently, Families USA commissioned Lewin Group, a health care and human services consulting firm, to analyze data from the U.S. Census Bureau to determine how many Americans were uninsured for an unspecified period of time from 2007 through 2008.
The problem is that today, by law and regulation, Washington policymakers tie health insurance to the workplace. The biggest link is the unlimited tax breaks for health insurance at the job, but similar tax breaks are unavailable to people who don’t or can’t get health insurance at the job.
The problem of the uninsured, then, is not so much people not having access to coverage, but keeping it once they have it. As Heritage Foundation health policy fellow Michelle Bucci has noted, “Tens of millions of Americans ‘churn’ through the health insurance system annually, repeatedly gaining and losing coverage due to the current structure’s inability to accommodate the high mobility of the American work force.”
So workers are routinely counted as uninsured, even if they are uninsured even for a short period. Officials at the US Labor Department have estimated that younger baby boomers held an average 10.8 jobs from ages 18 to 42 — with more of those job changes happening in baby boomers’ late teens and early twenties.
In addition to this issue of counting people who are changing jobs, it’s important to really examine how many Americans are chronically uninsured — in other words, those populations who are persistently uninsured or unable to gain coverage. A 2003 Health Affairs study found about 12 percent of the total people who were uninsured over a four-year period were chronically uninsured; the rest were in and out of coverage.
So, the policy is simple: Let’s tie health insurance to the person rather than the job. This would stabilize the market. We can do this by allowing people to own and control their health insurance, just as they own and control their auto, life and homeowners insurance. People would be able to take their insurance coverage from job to job without a tax or regulatory penalty. If we had true portability in health insurance, like we do in every other insurance market, the number of the uninsured would drop dramatically. That policy change alone would not be very expensive to taxpayers.
Of course for low-income populations, particularly those who are not eligible for government health programs, we should directly assist them in buying health care coverage. This could be done through a voucher system or some sort of tax credit arrangement. This could entail some costs, but it would reduce the existing ones taxpayers fund in treating uninsured patients in the emergency room.
Congress needs to propose sound health reform, but it won’t do so by misdiagnosing the problems. Nor will Congress improve matters by enacting policies — such as the progressive destruction of private health insurance on the installment plan — that will only make matters worse. We’ve seen employer-sponsored coverage continue to decline. Rather than push for a nationalized health system or even public health insurance plan that could crowd out the private insurance market, Americans should have the opportunity to own and control their health insurance.
