CATASTROPHIC CARE

A media executive’s take on our health care system’s flaws and plan for a totally different approach.

When Goldhill witnessed the death of his father from a hospital-borne infection, he decided to analyze the industry to understand how such a tragedy could occur, concluding that it does not live up to the standards of other industries in our economy. Contrary to the views of acclaimed economists Ken Arrow and Paul Krugman, Goldhill, who has not worked in the health care industry, asserts that the reason the industry provides poor customer service at unaffordable prices and gets uneven results is in large part because market forces are not at work. Patients have ceded their role as consumers to big intermediaries, including insurance companies, Medicare and Medicaid. As in other businesses, he argues, demanding consumers (i.e., patients) can affect quality of services, prices and safety. Goldhill proposes a system that combines a national insurance plan with a market-based system. His plan has three components: mandatory cradle-to-grave catastrophic health insurance with low premiums and a very high deductible; health savings accounts to which individuals would be required to contribute payments based on their age; and health loans, which would enable individuals to borrow against future contributions to their health savings accounts in the event of a costly but not catastrophic illness or accident. The author acknowledges that transitioning into a system that makes each individual a purchaser of his or her own health care might take a couple of generations, but he provides some guidelines for easing into it gradually.

Highly readable presentation of one businessman’s solution, likely to provoke discussion if not agreement.