Sunday, September 18, 2005

At What Cost

At What Cost - In August, The Commonwealth Fund (CMWF) released a report called "Seeing Red: Americans Driven to Debt by Medical Bills". In this report, CMWF claims that 37% of Americans have difficulty paying medical bills, have accrued medical debt, or both. On the surface, this appears to be quite a troubling statistic - a point the CMWF really drives home. And yet there is an underlying, and unmentioned, assumption that is driving this message: it is wrong for anyone to have any amount of medical debt. Books could be written (and I am sure some already have) on the question of whether or not healthcare is a public good that should be provided for all Americans regardless of their ability to pay. Whether it is or it isn't (and I will certainly devote future posts to this subject), the question of individual responsibility for healthcare utilization and financing is relevant.

Healthcare is a resource that people utilize at different frequencies and intensities. In this way, healthcare is like another public good, transportation. While the government provides the infrastructure for transportation (i.e. - roads and highways) and some means of transportation (buses, subways, etc.), the utilization of transportation is almost entirely paid for by individuals in direct proportion to their individual use. While it is just as important for me to get to work or the grocery store as it is for a person with less means or more means than myself, I have taken on personal debt to buy a car. Without a car, my options for utilizing transportation are practically limited, but not eliminated. We, as a society, have accepted that people will take on debt to utilize the transportation system. I am sure that many more than 37% of American adults have done the same. Furthermore, to meet transportation needs, you can choose to buy a used Honda Accord or a brand new Mercedes SUV. Both choices allow you to use the transportation system, but the level of personal financial responsibility is substantially different. This is a state of affairs with which most Americans are comfortable.

There is much more that could be said on this topic. Certainly, the comparison between healthcare and transportation breaks down at some point and the uniqueness of healthcare decisions have to be examined on their own. The point made here is that public goods are not completely financed by the government (education is another example of a public good that has multiple tiers based on the ability to pay), and thus some amount of personal financial responsibility is and should be expected.


  • It is very interesting to hear about how the cost of health coverage would be affected. Great article it gave me much knowledge on health insurance.

    By Anonymous Blue Cross of California, at 12:30 AM  

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