Lieberman's August comment on having to put off health reform until we're out of a recession shows how obtuse he is regarding the connection between the health insurance system and the rest of the economy. Unfortunately, he's not alone. Comments from other legislators and ordinary voters indicate that a lot of people think in the same terms. The problem is, "health care" should not be regarded as an issue separate from "the economy" or "unemployment."

Our health insurance system is acting as a drag on job creation and economic growth, and major reform could improve the situation. Of course, this improvement will only be realized if it's the right kind of reform. It doesn't look like that's going to happen this year.

I didn't vote for McCain, but I thought he had a better health plan than Obama. McCain understood we have to break the link between employment and insurance. That link impairs employment growth in three ways:

1. It forces companies to divert money to insurance that could otherwise go to something productive like better equipment or additional staff.

2. It provides an obstacle to people who would like to switch jobs or start their own business. Our country would be making better use of its human capital if people could pursue financial opportunities without regard to their insurance situation.

3. It creates another incentive to offshore production.

I'd like to see a plan that issued everyone a voucher to purchase insurance on their own. The voucher would only pay out to those companies that agreed to accept people regardless of pre-existing condition. The voucher would be paid for out of general revenues.

This plan would not solve all the problems of our current system, but so what? None of the alternatives being considered in Congress would solve all those problems. No matter what plan gets adopted, future legislation will be required.

But a voucher would provide universal coverage without any link to or burden on employers. That's a big improvement, and it would facilitate an economic recovery.

How much would your voucher pay? As you know rates for individual policies are substantially higher than the group rates extended through employers. Anything that prevented employer provided insurance has no chance of passing either house.

Yes because vouchers regulated by the goverment are sooo not a 'public option'.

I'm not sure how much the voucher should pay, but it shouldn't pay enough to cover the cost of a "gold-plated" policy. Part of the reason health care inflation is out of control is the adoption of policies that pay for everything, not just catastrophic costs. Does $7000 a year sound good? That should be plenty for catastrophic coverage for an individual.

Then again, maybe I'm getting ahead of myself. It might be better to provide an over-sized voucher just for the sake of getting a new system in place to replace the employment-based system. The voucher can always be reduced in a year or two. How about $12,000?

Also, please keep in mind the system I described in my previous post is not supposed to be The Grand Solution. It's merely a transitional measure to address the most pressing problems of the current system.

spud:

The basis of your post for healthcare is somewhat sound and I will also grant you healthcare is an additional cost not faced by manufacturers in Asia. Removing healthcare as a cost to doing business in the US is not a guarantee the resulting funds will be invested back into the US. The flow of funds have been overseas to create jobs there and in emerging markets at the expense of the cash cow in the US. A better return in the US in manufacturing, as opposed to speculative returns on W$ creating no value and resulting in asset appreciation, would go farther than additional funding for manufacturing gained by cutting expenses from which the resulting funds could not be tracked. The incentives for global manufacturing go well beyond healthcare insurance and what can be tagged as additional costs are integral to the infrastructure of the US unless you prefer a tidal wave of benzine rushing down a river.

An issue with vouchers is the cost of healthcare and healthcare insurance would rise to the size of the vouchers with little or no restraint. Next time you are in to the doctor, ask him the costs of a battery of blood tests at the company-store lab. My own personal experience at the glam-healthcare clinic for a major university revealed just such as knowledge by the doctor, his office, and billing (until a few days passed) was not readily available. (I guess the dart thrower of pricing was not available.) It finally took the Billing guy, with a price in hand, to suggest an offsite lab was cheaper by ~40% for the X-Rays at least. The healthcare system lacks transparency the same as derivatives on W$.

I suspect what is necessary to reign in healthcare and heathcare insurance cost is a public option where the gov can negotiate pharm and service costs the same as medicare. And yes there will be cries of gov in the private sector; but, I fail to see much in the way of competiton now as the industries involved both move in concert between industries and within each industry. And healthcare rejecting the public option? It will come to them as a take it or leave it option the same as litigation contracts between big companies and firms.

I have no doubt the price of insurance would rise to the size of the vouchers, but what I'm proposing is not intended to solve all the problems with the health care system. It's supposed to solve what I consider the most pressing problems: people going without insurance, insurance being linked with employment, and the cost of Medicaid to the states (I neglected that last point in my original post).

I should also state I'm a deficit dove. I think the federal government can endure disturbingly large deficits for several years, assuming the deficits are being accumulated for a sound reason.

Running up the debt for a universal insurance plan that lifts the financial burden from employers, the states, and potential entrepreneurs is, I think, a sound reason. The debt will be offset by increased employment, growth, and a subsequent increase in tax revenue.

Running up the debt to finance unnecessary warfare and massive bailouts of mismanaged companies, well, that's something else.

spud:

Cost is the most pressing issue with healthcare and healthcare insurance and is the excuse used by most naysayers of universal healthcare insurance. Cost coupled with transparency are the issues blocking the passage of of universal healthcare and/or healthcare insurance. Here a little reading for you: <link> "Elevated Sedimentation Rate"

I do not believe, for the reason(s) I cited, the additional funds gained by removing this cost from the backs of employers will result in job creation or the maintenance of jobs in the US. The additonal revenues will flow out of the US to overseas investment in jobs and capital. Better to give tax credits of a draduated scale to 100% or 100+% based upon company size (startups or small companies more) and tie it to job creation in the US.

I follow Keynes