Technical Reform vs. Fundamental Reform – What is the Difference?
Last week, Whole Foods CEO John Mackey weighed in on the current healthcare reform debate (Wall Street Journal, The Whole Foods Alternative to ObamaCare). Some question whether it was ill advised or not and honestly, that is for his customers, board and shareholders to determine in the end. As a citizen, I am glad he had the guts and took the time to lay out his thoughts persuasively and in detail unlike the loons disrupting the healthcare town hall meetings across the country these past several weeks. Discussion among thoughtful, well intentioned adults is essential to large issues such as healthcare reform and frankly the cornerstone of our democracy. Steven A. Burd the CEO of Safeway also weighed in on the topic in the Wall Street Journal in June (Wall Street Journal, How Safeway Is Cutting Health-Care Costs) and may have been one of the motivating factors for John Mackey’s piece. Unfortunately, John Mackey got it wrong.
Don’t misunderstand me, John Mackey has some very strong ideas, but like so many people in this debate he does not understand or appreciate the entire problem. Essentially there are two parts of the debate: part 1 – fundamental; part 2 – technical.
On the technical side, he has some terrific suggestions. Let’s review briefly:
• Remove the legal obstacles that slow the creation of high-deductible health insurance plans and health savings accounts (HSAs).
• Equalize the tax laws so that employer-provided health insurance and individually owned health insurance have the same tax benefits.
• Repeal all state laws which prevent insurance companies from competing across state lines.
• Repeal government mandates regarding what insurance companies must cover.
• Enact tort reform to end the ruinous lawsuits that force doctors to pay insurance costs of hundreds of thousands of dollars per year.
• Make costs transparent so that consumers understand what health-care treatments cost.
• Enact Medicare reform.
• Finally, revise tax forms to make it easier for individuals to make a voluntary, tax-deductible donation to help the millions of people who have no insurance and aren’t covered by Medicare, Medicaid or the State Children’s Health Insurance Program.
His technical solutions fall into two basic categories: (1) reduce cost, and (2) encourage responsible use of the services. I agree that we should empower employers to use innovative tools such as HSA’s to control costs and modify user behavior. I agree that we should equalize tax laws so individually owned health insurance is tax deductible like employer-provided plans. I agree that we should enact Medicare reform. I agree that we should make costs transparent so that consumers understand what health care treatment costs. I even agree that we should carefully review government coverage mandates, but with care to ensure an appropriate minimum that all insurers should offer nothing less than.
Now for the tougher ones. Eliminating state laws that prevent insurance companies from competing across state lines amounts to making insurance regulated nationally instead of by the states and I agree with that too, but suspect that may be the hardest of the reforms Mr. Mackey proposed to be enacted. While I do not disagree that tort reform should be carefully considered, I find it incongruous that someone who wants the government out of healthcare for fear that the government is incapable of providing the care we deserve, yet is so willing allow the government to pass laws to limit our damages unilaterally in the event of medical malpractice.
Seven out of eight so far. Now the doozy. Revise tax laws to make it easier for individuals to voluntarily contribute towards the coverage of the millions of Americans that do not have coverage. This is downright silly. Please pass it, but this is not going to close the gap. In fact, all of John Mackey’s ideas really only serve the businesses that currently provide healthcare to their employees, their employees and those fortunate individuals in our country that can afford to purchase coverage on their own. Hundreds of people have responded negatively to John Mackey’s opinion piece because he jumps right in and says that healthcare is not a fundamental right and comes across as Marie Antoinette when she so famously said “Let them eat cake.” He compounds the problem by framing his suggestions as a counterpoint to “ObamCare” which I can only assume was meant to trivialize the debate linking it solely to the president. Now I may have gotten the literary reference wrong, but the point is John Mackey had intended to be fiscally prudent and point out some very well intentioned reforms that would help him, his firm, his employees and millions of Americans who currently have health insurance, but in turn made himself look like a callous jerk. Humanity is the fundamental part he missed.
Should healthcare be a right? That is for all of us to thoughtfully and thoroughly consider. If we decide yes, then it will fall on us to find a way to pay for it. Contrary to Mr. Mackey’s suggestions the nationalized health systems in Canada and Europe are generally very popular. The fact that many in Canada and Europe may want to supplement what they get with additional coverage does not undermine the value of the basic coverage, but is instead proof that the citizens of those countries are free to purchase more or different coverage if they can afford it. A point John Mackey completely misses. There is a similar market here in the United States: Private Schools.
I believe healthcare is fundamental and minimum coverage should be provided to all for several essential reasons: (1) in certain portions of our economy businesses cannot provide healthcare, even if they wanted to because their competition does not, (2) a healthy and happy workforce is essential for the competitiveness of our nation, and we need to be ever more competitive in this evolving global economy, investing in healthcare is an investment in our future competitiveness, (3) people without proper health insurance still get sick, may spread infectious diseases because they cannot get timely proper care and are a burden on our emergency care network, and (4) it is just the right thing to do, like social security, like Medicare, like schools, like national parks, and so many other things government is essential for. This is why we have governments. We cannot have 45 million people without healthcare no more than we can deny educations to our children.
John Mackey is not wrong to question how we are going to pay for it. We need to spend a great deal of time soul searching on that point. Taxing the rich and eking out more efficiencies from the system are not going to do it alone forever. If healthcare is a fundamental right, then we all should contribute to the best of our ability through lifestyle choices, through premiums, through taxes and even accepting minimum healthcare may be a right but unlimited healthcare cannot be guaranteed. Lets stop yelling at one another and calling each other names and instead focus on getting everyone some reasonable minimum coverage and figuring out how we are going to pay for it.
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