The Swiss System

| Tue Nov. 17, 2009 11:26 AM EST

Tyler Cowen has a list of 11 healthcare reform ideas (plus three extras) over at his site today, and he says he would "trade away the Obama bill for these in a heart beat."  I wouldn't, for reasons having more to do with future reform than with anything on the table today, but there's plenty to agree on here.  Tyler would like to federalize Medicaid, spend more on medical R&D, make an "all-out" effort to limit hospital infections, encourage the spread of walk-in clinics, and a few other things that I've written in favor of before.  So bring 'em on.

But he's also in favor of limiting universal coverage to catastrophic care, which I'm not so keen on, and thinks that universal coverage is pretty much impossible if you try to build it on top of our current jury-rigged system:

11. Realize that you cannot tack "universal coverage" (which by the way it isn't) onto the current sprawling mess of a system, so look for all other means of saving lives in other, more cost-effective ways.  If you wish, as a kind of default position, opt for universal coverage if the elderly agree to give up Medicare, moving us to a version of the Swiss system and a truly unified method of coverage.  But don't bet on that ever happening.

I'm sympathetic to this idea, but I'm not really sure why it has to be true.  The current bills pretty clearly move us along the path toward a Swiss system — not my first choice for a model to follow, but certainly better than what we have now — and I don't think that the existence of Medicare as a separate part of that really stands in the way.  A single comprehensive system for all would probably be better and more efficient, but it's hardly an absolute precondition.  My own guess is that a decade or two from now we'll basically have Medicare for the elderly and the Swiss system for everyone else.  Austin Frakt adds this:

The current debate over health reform is just the beginning–call it Health Reform Debate 1.0 (beta). Debate 2.0 will be about costs, specifically about payment reform....Therefore, I’d like to add a 15th item to Cowen’s list: payment reform that compensates providers, at least in part, on the basis of quality and cost control. That’s very vague. One can conjure up some specifics and some have. Few are thoroughly tested and none have been anywhere near the center of political debate. But they will, and soon.

Agreed.  Coverage first, cost controls second.  It would be great to do it all at once, but politically there's really no alternative to the way we're doing now.