Christian Schneider writes two of the best paragraphs on "Healthy Wisconsin" that I have read. Commenting on the idea that the Democrats think that they can buy more health care for 15 billion than insurance companies and private administrators buy for 18 billion, he writes:
This brings up an interesting contradiction within the Democratic ranks in the State Legislature. Think about the University of Wisconsin System and the nearly $1 billion the state provides to the system annually. Now imagine the state cutting $300 million from the UW System and freezing tuition, while doubling the number of students the state’s campuses had to accept. Is there any Democrat in the Legislature that wouldn’t say the quality of education those students receive would be drastically harmed by such a scenario?
Yet this is similar to what the Healthy Wisconsin plan proposes doing. Democrats are proposing pulling $3.3 billion in “savings” out of the health care system, while drastically increasing the scope of individuals and procedures covered. And this isn’t supposed to affect our quality of health care?
Isn't this just magical thinking? The justification for this is that government is an 800 pound gorilla that can negotiate down prices in a way that insurance companies and private admonostrators (each of whom presumably controls something the providers want, i.e., patients) cannot.
There is a sense in which this may be true. If HW crowds out private insurance (something that I am not at all certain will happen), then we'll spend 15 billion on health care because that's all we'll spend on health care. The notion that providers will simply provide more for less seems fantastical.
What seems likely to happen is a diminution in care (the government and providers needn't be concerned that consumers will go to another plan)and, as Christian points out, gradual expansion of the patient's costs. Obviously this will still be better for those that are not currently insured but it seems unlikely to be for those who are. This is, as I think, the problem with single payer schemes. They take a system that works for most people and blow it up to address the fact that it works less well for 10-12% of us. You'd think it would make more sense to go at it from the other end.