Jim Crow Healthcare

Graham-Cassidy comes up for a Senate vote next week. Here’s why I hope it does not pass.

First, and initially foremost, it will make health insurance harder to get for tens of millions of vulnerable Americans. In ten years, when Medicaid funding is further reduced, it will essentially gut the system we have laboriously established over many decades to take care of those who cannot take care of themselves. Medicaid is not a perfect system, but it’s there, and it works.

Second, The ability of the states essentially to opt out of pre-existing condition protections will return us to our darkest, and least-humane period. Got cancer? Oh sorry, good luck with that, but you’re going to have to pay more for your coverage now, a lot more.

Finally, and this is almost as big a reason as the first two, health care should not be left to the states. With few exceptions—I’m looking at you Massachusetts, with your Obamacare precursor that is working so well—they have a bad track record. Why is that? I’m not sure. Overall—and you can note my preconceptions in this—I think health care is too complicated and requires too much expertise to be handled locally. There’s a reason we all go to major medical centers for major surgery and not local clinics. Size and scale, managed correctly, beget expertise and good results. Google. Facebook. Amazon. 

Why do I think the feds can manage a large healthcare program, either insurance or single-payer-based, better than states? Two reasons:

Big problems with big societal consequences attract big thinkers. We don’t ask states to manage national defense. Making good medical care broadly available is a challenge that requires the heavyweights of policy and process.

The second reason is that although national management of issues has its own risk of bloat and inefficiency (which, incidentally, I don’t think is any greater than on the state level), it has fewer racial and economic biases. This is why we needed federal Civil Rights legislation a half-century ago. Because of racial prejudice, the southern states were making a hash of it. Not only were they not helping, they were making things worse for blacks.

Why do I think prejudice might impede good healthcare decisions by states today? Just look at the large number of states that refused to expand Medicaid under Obamacare. The expansion would have benefited their poor and would have been almost entirely paid for by the federal government. Yet they passed. They said they didn’t like the future costs. They said they didn’t like the constraints. What I think is that they just didn’t think it was important to help their poor if it meant letting the federal camel get its nose under their tent. And the fact that many of those poor were black? Coincidence?

Milton Friedman, the famous economist from the University of Chicago, was more of a libertarian than I am. He thought government should be as small as possible. And when government had to be involved, he believed that the best decisions were made locally. He saw centralized government as the beginning of the end of liberty.

He was right, in principle. Especially when the choice, as it was for him, was between capitalism and totalitarian control of the economy. But even he acknowledged that it is the proper role of government to enable us to do collectively what we cannot do individually. Healthcare is a perfect example of such a need. It requires that we share our healthcare risks broadly among us, so that no one of us is left to bear the full furry of bad genes or bad luck. The bigger the risk-sharing pool, the better that system will work.