Health care debate: Universal coverage needed

Health cost headlines, stethoscope and rising graph
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(MoneyWatch) COMMENTARY It's been well documented that our current health care system is far more expensive and has far worse outcomes than that of many other developed nations. This certainly isn't exactly a good example of "American exceptionalism." In fact, it's one aspect of life here in the United States that could use some changing.

But there's not one magic bullet or ideology that will fix this mess -- we need to address a handful of problems. Our politicians, the Supreme Court, and our fellow citizens all need to honestly face a few basic realities regarding medical insurance. One in particular involves the issue of universal coverage.

Thirty-two of the thirty-three developed nations have universal health care coverage. Guess who the lone exception is. Yep, it's us. So why is universal coverage needed?

Opponents to the insurance mandate say it isn't fair to make someone buy something they don't want or don't need. But you can be sure that if someone gets sick or is in an accident, they'll be glad they have medical insurance. When you think about it, with any type of insurance, the people who don't need it are paying for the people who do need it. With life insurance, for instance, the premiums paid by people who live pay for the benefits of people who die. It's the same with auto insurance, homeowners insurance, and medical insurance as well.

Allowing people to "game" the system by joining just when they need benefits will bankrupt any insurance system. There are two ways to avoid this gaming: One is to mandate universal coverage, so you're required to be in the system at all times, even when you don't need benefits. I believe this is the best way to address the gaming problem with health insurance, when you consider the alternative.

The other way to address gaming is to deny benefits to anybody who isn't in the system. This currently happens with all forms of commercial insurance, such as life insurance, homeowners insurance, and so on. If you don't pay the premiums, you don't get the benefits.

The trouble is, we don't deny health care to the uninsured population; if you're uninsured and you pay a visit to an emergency room, chances are good you'll receive treatment. Taxpayers and people with insurance are paying for this medical care by subsidizing the emergency rooms -- is that fair? This situation is forcing more and more emergency rooms to close their doors.

To those politicians and citizens who oppose the universal mandate, I ask you this: Are you willing to allow the emergency rooms to close their doors to the uninsured and let them die in the streets? Put this bluntly, and most politicians will hem and haw, but they certainly won't say "Let them die." But you'll need to deny treatment to the uninsured if you want to keep emergency rooms open, contain rising health care costs, and not have a universal mandate.

I don't think the "let them die" attitude is the sign of a civilized society, and it certainly isn't the kind of exceptionalism that we should be proud of. That's why I support a universal insurance mandate.

Medicare is a system that mandates universal coverage for citizens age 65 and over, and it's an important program that keeps seniors out of poverty. So why not extend some form of this system to all citizens? Yes, Medicare needs some attention to contain rising costs, but repealing the universal mandate feature of Medicare won't help matters.

Normally I focus on personal financial strategies to make the most of your retirement years. But since an important part of our retirement security is the availability of medical insurance, it's an important part of our financial planning to pay attention to the political debate about health care reform. Lack of available medical insurance is a real problem for people who want to retire before age 65, or who get laid off in their 50s. The Patient Protection and Affordable Care Act, a.k.a. Obamacare, would help address this problem, but now its fate is in question. Repealing it will be a step back for many Americans, including people in their 50s and 60s. So I feel compelled to speak up, and I'll share a few more ideas about politics and our medical system in posts later this week.

The sad state of our political system and health care has motivated me to take care of my health in order to minimize the odds of going into an expensive and sometimes ineffective medical delivery system. I suggest you consider this strategy as well.

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    Steve Vernon helped large employers design and manage their retirement programs for more than 35 years as a consulting actuary. Now he's a research scholar for the Stanford Center on Longevity, where he helps collect, direct and disseminate research that will improve the financial security of seniors. He's also president of Rest-of-Life Communications, delivers retirement planning workshops and authored Money for Life: Turn Your IRA and 401(k) Into a Lifetime Retirement Paycheck and Recession-Proof Your Retirement Years.