Preference for universal coverage is not as great as our desire to reduce health care costs

NY Times - By RAMESH PONNURU - April 8, 2009
The Misguided Quest for Universal Coverage

AMERICA’S dysfunctional health care financing system needs to be reformed. But the goal should not be universal coverage. Reform should simply aim to make health insurance more affordable and portable.
Universal coverage has so dominated the health care discussion that even some Republicans have tried to devise market-friendly ways to achieve it. The case for doing so is presented in practical, moral and political terms.
The practical case is that uninsured people raise premiums for everyone else. But such cost shifting raises premiums by 1.7 percent at most, according to a 2008 study published in the journal Health Affairs. Reforms that increase the number of people with health insurance, while stopping short of universal coverage, would presumably make that small percentage even smaller.
Efforts to eliminate this relatively tiny expense, on the other hand, would surely generate new costs. To mandate that everyone purchase health insurance, as many have suggested, would require that the government specify what constitutes adequate coverage — in other words, what health conditions an insurance policy would need to cover. Every provider group with a lobbyist, from massage therapists to fertility specialists, would want in. The result would be expensive insurance policies and costly government subsidies to help people buy them. Young and healthy people, especially, would be forced to overpay. So we would end up with more cost-shifting, and no savings. (continues...)