What would Republican healthcare look like?

A system that aims for “fewer bureaucrats, lower taxes, and more personal freedom”

Preface: This article is not an attempt to persuade you to embrace or oppose a Republican healthcare system. It’s simply a description of what a healthcare system that actually reflects Republican values would look like.

Introduction

In my last article, I discussed how the terminology we use to describe US healthcare misleads people into thinking that it reflects Republican values. But what would a healthcare system that reflects Republican values actually look like?

To start, what do Republican voters consider to be their values? For purposes of this article, we don’t need a comprehensive list of every value within Republican ideology - just the elements relevant to healthcare. With that in mind, I’d suggest that the relevant Republican values are as follows:

• Economic liberty (low taxes)

• Personal responsibility (individuals make their own decisions)

• Efficient and effective governance (anti-bureaucracy)

I don’t know any Republican who opposes any of these values. I’m yet to meet a Republican who says “the state should be responsible for your welfare” or “we need more red tape and bureaucracy.”

Applying Republican values to healthcare

So how do we apply these values to healthcare? What does a healthcare system built on economic liberty, personal responsibility, and hard work look like?

First and foremost, a healthcare system that reflects Republican values leaves the economic power in the hands of the individual. It does not impose high taxes that weaken the individual’s economic power.

Second, it does not waste resources through bureaucracy and red tape. A healthcare system that reflects Republican values is lean and efficient. It works.

Third, a healthcare system that reflects Republican values makes personal responsibility the cornerstone. As individuals, we are responsible for the decisions we make that affect our health - it is not the state’s role to control our lives and tell us how to be healthy.

Getting practical

How then do we put these concepts into practice? What does a healthcare system that leaves the individual in control of his money and his healthcare decisions look like?

To begin, it’s clear that this system needs to be efficient. We cannot have a sea of bureaucratic administrators enriching themselves by creating red tape and bureaucracy. Republicans have learned the lesson of history that high taxes often inure to the benefit of the taxman himself. To the extent taxmen and bureaucrats exist in a Republican healthcare system, they should be few in number, and under no circumstances should they enrich themselves through their taxation.

It’s also clear that the system should limit the amount of money it takes from the individual. When we look at the US, and look at other countries, we should see our healthcare system taking less money from its citizens’ paychecks than the systems of France and Sweden and China. 

Finally, this system should leave everything it can in the hands of the individual. This should not be a system that dictates. This should not be a system that extends its tentacles into every corner of our lives. Individuals under this system should have the freedom to make their own decisions in all aspects of their lives, including their health.

So, what we have is a healthcare system with a small bureaucracy, limited taxes, and limited scope.

Comparing this vision to our existing healthcare system 

When we compare this ideal system to our current system, the differences couldn’t be more stark. Our current system is one of sky-high taxes, extensive bureaucracy, and expansive scope.

For most workers with a typical middle-income salary, taxes for healthcare are greater than all non-healthcare-related taxes combined. Healthcare is the tax in America today. (I discussed this in a previous article.) A middle-income worker with family coverage is taxed about $13,000 more than he would be taxed in a country with standard levels of healthcare taxes. No nation taxes its citizens as much for healthcare as the US does. No country even comes close.

Our bureaucracy is vast beyond belief, and our bureaucrats and tax collectors are compensated extravagantly through our tax money. Whereas other countries have one or several bureaucratic organizations administering healthcare, the US has thousands. Other countries have the equivalent of the IRS and DHHS, and stop there. In the US, we not only have the IRS and DHHS, but we have thousands of privatized tax collectors and bureaucrats (BCBS, UnitedHealth, etc) imposing their own additional privatized taxes on Americans. These privatized tax collectors are completely duplicative and wasteful. But more importantly, the concept of privatized tax collectors is abhorrent on principle alone.

Furthermore, the bureaucratic administrators of US healthcare have expanded the scope of their control far beyond any reasonable or prudent measure. Want to chat with a doctor for a couple minutes? Oh, you need to make sure the doctor is within your administrator’s network. Want to get your blood pressure pills that cost three cents to manufacture? Oh, you’ll have to get permission from a doctor and then find an in-network pharmacy and then still pay a 50x markup for them.

Implementing the vision

Let’s put some more meat on these bones. What should we do to implement a healthcare system that reflects Republican values?

First, we slash the bureaucrats. I’m not talking about a 10% reduction or a 20% reduction or even a 50% reduction. I’m talking about a 98-99% reduction. All the private tax collectors who have enriched themselves off your tax money for years must go. The remaining public administration must be streamlined and simplified. 

There’s an old saying in healthcare: “where there’s mystery, there’s margin.” In practice, that has meant a lot of financial leeches using the complexity of healthcare to hide how they’re enriching themselves from money taken from your paychecks. This must end.

Second, we drastically reduce the taxes we collect to finance this system. I’m talking about cutting healthcare taxes by 50%. That would put an extra ~$13,000 in the paychecks of the typical American worker with family coverage, and an extra ~$6,000 in the paychecks of the typical worker with individual coverage. That would immediately invigorate the economic prospects of the American middle class.

A 50% tax cut sounds impossibly ambitious. But in practice, that would only reduce the level of healthcare taxation to the OECD mean. In other words, that would bring the US down to an average level of healthcare taxation, not a low level of healthcare taxation. 

Finally, we must limit the scope of the healthcare system’s control. Republicans have no problem with having a fire department to deal with emergencies, and Republicans have no problem with a healthcare system that deals with emergencies. When we get in a car wreck, or have a heart attack, or get a cancer diagnosis, we expect the healthcare system to address it.

But we don’t need the healthcare system meddling in all parts of our lives. We don’t need the healthcare system inserting itself into our routine, everyday activities - the ones that really impact our health. Our health is our own responsibility - it’s our own choice to eat healthy and exercise, or to accept the consequences if we don’t.

Conclusion

Republican politicians have been too afraid to put forth a vision for healthcare reform that reflects Republican voters’ values. 

They have good reason to be afraid - implementing a healthcare system that actually reflects Republican voters’ values would slash the revenues of the supremely powerful healthcare industry. Having feasted on money from workers’ paychecks for decades, the industry has developed formidable financial power, which it converts into political power. And it does not hesitate to yield that political power against elected officials.

But at some point, a Republican should put forth a viable plan for healthcare reform. Why? Because if not, the Democrats will control the reform process. And whichever party controls the reform process - and gets credit for the reform - is going to be hugely popular. 

They’ll be popular because real healthcare reform - whether it’s the Democrat vision for single payer/M4A or the Republican vision I’ve outlined above - will be an overwhelmingly positive experience for the voting populace. Health reform is an opportunity for Republicans to give the middle class the single largest financial boon they will experience in their lifetimes. (Remember, even if we aim for mediocrity, and only reduce healthcare taxation to the OECD mean, that still represents a potential ~$10k pay raise / tax cut for American workers.) And on top of that, reform would create a remarkably simpler customer experience for patients (and a simpler work experience for most providers, as well).

Republican voters aren’t told how the current US healthcare system betrays their values. They aren’t told that it taxes them more than the IRS taxes them for everything else. They aren’t told that it’s the world’s most wasteful, most bureaucratic form of socialized medicine. Instead, they’re told that reducing the taxes, waste, and bureaucracy in the system is socialist. I’d be curious to see whether an enterprising Republican leader could flip the script.