I have been devoting this space to deliberately implausible ideas lately, and the time has come to turn to an issue that our politicians are actually debating: health care reform. Though “debating” might be a strong word, since the politicians I’m talking about are all Republicans, and it’s hard to have a serious argument when most everyone involved (including our unhappy president) really, really wishes that they could just stop and talk about tax cuts instead.
In theory there is a coherent vision underlying Republican health care policy debates. Health insurance should be, like other forms of insurance, something that protects you against serious illnesses and pays unexpected bills but doesn’t cover more everyday expenses. People need catastrophic coverage, but otherwise they should spend their own money whenever possible, because that’s the best way to bring normal market pressures to bear on health care services, driving down costs without strangling medical innovation.
This theory – along with, yes, a green-eyeshade attitude toward government expenditures on the working poor – explains why conservatives think a modest subsidy to help people buy health insurance makes more sense than Obamacare’s larger subsidies. Republican politicians may offer pandering promises of lower deductibles and copays, but the coherent conservative position is that cheaper plans with higher deductibles are a very good thing, because they’re much closer to what insurance ought to be – and the more they proliferate, the cheaper health care will ultimately be for everyone.
Is there an existing health insurance system that vindicates this boast? Yes, in a sense: There is Singapore, whose health care system is the marvel of the wealthy world. Singaporeans pay for much of their own care out of their own pockets, and their major insurance program is designed to cover long-term illnesses and prolonged hospitalizations, not routine care. The combination has produced genuinely extraordinary results: The island state has excellent health outcomes while spending, as of 2014, just 5 percent of GDP on health care. (By comparison, a typical Western European country that year spent around 10 percent; the United States spent 17 percent.)
However, there has never been a major Republican policy proposal that just imitates what Singapore actually does. That’s because the Singaporean vision is built around personal responsibility and private spending, but also a degree of statism and paternalism that present-day American conservatism instinctively rejects.
First, Singaporeans do not spend money voluntarily saved in health-savings accounts. Under their Medisave program, they spend money saved in mandatory health-savings accounts, to which employers contribute as well. Second, their catastrophic insurance doesn’t come from a bevy of competing health insurance companies, but from a government-run single-payer system, MediShield. And then the government maintains a further safety net, Medifund, for patients who can’t cover their bills, while topping off Medisave accounts for poorer, older Singaporeans, and maintaining other supplemental programs as well.
So the Singaporean structure does not necessarily minimize state involvement or redistribution. It minimizes direct public spending and third-party payments, while maximizing people’s exposure to what treatments actually cost. And the results are, again, extremely impressive: By forcing its citizens to save and manage their own spending, the Singaporean system seems to free up an awful lot of money to spend on goods besides health care over the longer haul of life.
This is the point in a normal column where I would note the insuperable political obstacles to getting a Singaporean plan through Congress even if Republicans embraced it. (And for the record, I am quite certain that making America Singapore wouldn’t generate quite the same cost savings for cultural reasons alone: A sprawling empire of free spenders is never going to be as disciplined as a city-state ruled for 30 years by Lee Kuan Yew.) But I’m dealing in political implausibilities these days, and if you simply wish away the hurdles, there is a stronger case by far for trying to get to Singapore than for the jerry-built, incoherent thing that Paul Ryan is struggling to maneuver through the House.
What’s more, the federalist health care compromise floated recently by Sens. Bill Cassidy and Susan Collins is a little closer to Singapore than many Republican plans to date. The senators propose that states be allowed to experiment with an Obamacare alternative that would 1) auto-enroll the uninsured in catastrophic coverage and 2) directly fund health savings accounts for the working class and poor. The first isn’t MediShield (there’s no public option) and the second isn’t Medisave (no mandatory saving). But together, they’re more Singaporean than what RyanCare does and doesn’t do, and better for it.
Of course they’re also a bigger compromise with paternalism than the Republican Party’s True Conservatives are currently willing to accept. They have their principles, and making America Singapore is simply a non-starter.
I just hope those principles are a comfort to them when the next wave of liberalism delivers us to a much more plausible health insurance destination than Singapore: Straightforward single-payer, in the form of Medicaid for almost all.