The Times of India
November 26, 2010
Why have you been pitching for a single payer system for health insurance rather than a system where several private companies compete?
The US model of private health insurers has been proven inefficient and expensive. Rather than provide better healthcare at lower costs, insurance companies innovate at finding better ways of discrimination. They are inefficient because they are trying to figure out how to insure people who don’t need the cover and keep out people who need it. With many companies, they also need to spend on marketing and advertising. The incentives are all wrong and the transaction costs are very high and you have to give them a high profit. In health, social and private incentives are totally disparate. Competition does not work in healthcare especially in the health insurance market. Several countries like the UK, France and Sweden have a single payer system, differing only in the organisation of healthcare delivery.
Several health insurance companies are setting up business here. Should India be worried?
India would be in a terrible mess, given the size of its population, if it went down the wrong route (of private companies for health insurance). They should learn from the mess that the US has got into. Once the companies start making profits, special interests in politics will come into play and it will be difficult to get them out.
Comment:
By Don McCanne, MD
Nobel laureate Joseph Stiglitz understands single payer. President Obama knows that he does. So why doesn’t…
(No, health care reform shouldn’t be reduced to a mere conundrum.)