"Fair is foul, and foul is fair."
Thus incant the three "weird sisters" usually referred to as witches
- at the outset of Shakespeare's "MacBeth", as they set forth
the proposition that what is good will be made bad and what is bad will
be made good.
In like manner, three nationally syndicated columnists - Joan Beck, Molly
Ivins and Jane Bryant Quinn - have recently stirred the pot, proclaiming
a fair health care reform proposal foul and a foul one fair.
All three columnists attack the idea of Medical Savings Accounts (MSAs),
particularly the Republican proposal to provide Medicare beneficiaries with
an MSA option.
Currently, most people get their health insurance either through their employer,
or from the federal government through Medicare and Medicaid. In the past,
most employers offered a health insurance policy with a deductible up front,
and then people had to pay, say, 20% of their medical bills up to a maximum
amount. Increasingly, companies are moving to health maintenance organizations
(HMOs) or other types of managed care.
An MSA permits a third option. A person may take the same money that is
currently spent on that low-deductible policy or HMO and purchase a less-expensive,
high-deductible health insurance policy, say, with a $3,000 deductible.
The money that is saved by purchasing that less expensive policy is then
deposited by the employer in a Medical Savings Account and can be used during
the year to pay smaller health care bills. Any unspent money in the account
at the end of the year can be withdrawn or rolled over and grow with interest
to be used for health care in the future.
In attacking MSAs, the three columnists quickly assert that fair is foul.
Joan Beck claims that "the idea of Medical Savings Accounts is largely
an untried idea."
Not true. Congressman Matt Salmon (R-AZ), testifying recently before the
House Subcommittee on Civil Service, said that there are some 3,000 U.S.
businesses that have adopted some form of MSA. Abroad, in 1984 the country
of Singapore adopted a "Medisave" program as the primary means
of paying for health care. Today, Singaporeans have access to the same technology
as most European countries, with hospital stays equaling those of aggressive
managed care firms in the U.S., but they are only spending 3.1% of their
GDP (compared to about 14% in the U.S.).
Jane Bryant Quinn thinks that only healthy and wealthy people would want
an MSA, but during the same congressional hearing, everyone testifying --
some of whom had implemented MSA plans for their own employees -- found
that both the healthy and sick benefited financially from the plans. The
healthy benefited because they got to keep the unspent MSA balance at the
end of the year, and the sick because they spent less money out of pocket,
since their exposure was limited to the MSA amount. Insurance paid 100%
of the rest.
Molly Ivins thinks that Republican support of MSAs is the result of recent
lobbying by special interest insurance companies looking to make money off
selling the MSA plans. But the MSA idea goes back to the mid-1980s; several
think tanks and congressmen -- including those now in the Republican leadership
-- have supported the idea for years. Further, most large insurance companies
have opposed all MSA legislation for the very reason that it would encourage
individuals to retain some of the money they had been giving to the insurance
companies. (As in "MacBeth", you know the world is topsy-turvy
when Molly Ivins would rather people give their money to insurance companies
than keep it themselves.)
All of the above columnists also think that foul is fair -- that MSAs would
undermine the Medicare system. Surely a system that is by everyone's count
going bankrupt in seven years is already undermined. Medicare has been plagued
with exploding costs and suffocating regulations for years.
MSAs are simply not a radical idea. Indeed, most self-employed individuals
who purchase a health insurance policy on their own -- and thus don't perceive
the employer or government as providing a health insurance policy free --
usually choose a high-deductible policy and pay for smaller medical expenditures
out of pocket. All an MSA does is provide individuals or their employers
with the opportunity -- not a requirement -- to put a limited amount of
tax-free money in an account to pay those smaller medical bills.
Congressional Republicans are trying to fix and preserve Medicare by providing
senior citizens with private sector options such as MSAs. By contrast, these
columnists criticize the plan as threatening to an already bankrupt system.
Their solution is to stir the pot and chant: "Double double toil and
trouble; Fire burn and cauldron bubble." It may be good theater, and
even good liberal politics, but it won't help Americans get better health
care.
The National Center for Policy Analysis is a public policy research institute
founded in 1983 and internationally known for its studies on public policy
issues. The NCPA is headquarters in Dallas, Texas, with an office in Washington,
D.C.