A bold plan to fix health care
MIT economist Amy Finkelstein on her new book, “We’ve Got You Covered: Rebooting American Health Care"
For all its flaws, the American health care system does not generally allow people to die untreated in the streets due to an inability to pay.
Life-saving care is not an ordinary commodity where if you don’t have the cash you don’t get the service. But nothing about the rest of the system follows logically from that. If you have a heart attack and end up in the hospital, they will try to save your life. But as my podcast guest Amy Finkelstein explains, “if you're having cardiovascular disease, they have to stabilize you, but they don't treat the underlying condition. They just send you right back out.” But if you have untreated cardiovascular disease, you’re likely to end up back in the hospital again. It would be much more cost-effective and humane to give people useful medical care before they are on the verge of death rather than at the last possible minute.
That’s the intuition behind the idea that health care should be a right, not a privilege. At the same time, there are a lot of health care services that a person might want that they don’t necessarily need. Covering everything under that heading would be prohibitively expensive, but trying to deny people access to the care they want in the name of efficiency raises the specter of rationing and death panels.
In her new book with Liran Einav, “We’ve Got You Covered: Rebooting American Health Care,” Finkelstein proposes throwing out the current American patchwork quilt of coverage in favor of a more deliberate effort to pair fundamental moral commitments with economic realities. They call for:
A universal basic insurance system, covering both catastrophic and routine care but at a bare bones/no frills level of service.
A global budget, set by Congress, to determine how much money the basic plan has to spend on meeting the public’s basic needs, paired with expert panels to decide which services to cover.
An additive system of private top-up insurance that people could (and they anticipate mostly would) buy into to secure access to shorter wait times and more creature comforts.
In our interview, Finkelstein lays out the hows and whys of that system while also making the case that even though it’s politically inconvenient, we really should aim for fundamental transformation rather than one more tweak or patch. It’s a fascinating perspective that contrasts with the normal political alignment in which, if you favor dramatic transformation, that’s assumed to mean the full Bernie-style Medicare for All. If you’re more moderate, that’s assumed to mean incrementalism and tweaks. I frankly struggle to come up with a scenario in which anything resembling the Finkelstein/Einav program comes to fruition. But it also strikes me as an extremely correct diagnosis of what ails a health care system that continues to be badly flawed, and a compelling portrait of a better approach.
Paid members can read the full transcript of our conversation below and are invited to subscribe to the Slow Boring Podcast feed to get our audio content automatically in their podcast player.