During today’s HELP committee hearing on the 25 million Americans who are underinsured, Sen. Michael Enzi (R-WY) laid out the conservative solution for providing coverage to individuals who are not adequately protected against catastrophic health care expenses:
We also know that when consumers bear some of the costs of their health care, total spending is reduced. It is common sense that we are more vigilant with our own money than if someone else is paying the bill, and this is especially true in health policy. Going all the way back to the Rand study in the 1970’s, we know that reasonable cost sharing reduces spending, without adversely impacting the quality of care. Anyone needing further proof of this need look no further than our recent experience with health savings accounts. HSAs require consumers to pay for more routine services, and as a result, HSAs have seen premium increases that have been dramatically lower than other types of insurance.
We need a private health insurance market that can deliver choices of high quality products to all types of people – not a one size fits all federally determined solution.
It’s this ideology that underlines the conservative health vision: allow Americans to buy insurance on their own and you’ll reduce health care spending. It is based on the theory that increased financial exposure will encourage patients to act like consumers, comparing quality and costs and negotiating lower prices. It also, according to the rhetoric, gives people greater control over their health care.
But Enzi is wrong in assuming that purchasing health insurance is the same as buying any other consumer good. If one car is too expensive, a consumer can chose a cheaper model or rely on public transit for transportation. But health is about life and death and high-deductible plans only discourage consumers from seeking any care, even when it is high quality or critical.
According to a survey from the Employee Benefit Research Institute, while people in such plans were more cost conscious, they were twice as likely to report delaying or avoiding care and about three times as likely to report paying a large fraction of their income on health costs as those in comprehensive insurance.
Ironically, Enzi’s solution to dealing with Americans who don’t have enough insurance is to encourage them to use even less care.