The Missing Middle in the Health-Care Insurance Debate

With the 2008 presidential race in full gear, we’re suddenly hearing a lot about universal health insurance again, and it’s not just a popular topic within these shores.

The International Society of Employee Benefit Specialist conference in Toronto put health insurance front and center — focusing on the struggles that employers and countries have in providing health and retirement benefits to employees and citizens.

About two-thirds of the attendees — like me — represented different aspects of the U.S. benefits industry; the other one-third came from Canada.

I knew little about how Canadian health care really worked. All I’d ever heard was that it was free for everyone, but a system with long waits and paid for by high taxes. Neither sounded appealing.

I asked one of the Canadian benefits managers how long Canadians had to wait for an MRI test. “Three to six months,” he replied.

Based on experience with employees of the companies that my firm serves, I thought, “Americans have a hard time waiting for even Minute Rice to cook and would never put up with waits that long. Universal health care will never fly in this country.”

Through my company’s work, we often negotiate with health insurance carriers to obtain tests and consults sooner rather than later. I asked my colleague what he would do if he couldn't medically afford to wait and he quickly replied, “Go to Buffalo, New York.”

Next time, he’ll need a passport, of course, but otherwise he crosses the border for care whenever he needs to and pays out of pocket. He says it’s worth it.

Here in the U.S., we don’t want to pay for anything ourselves. Unfortunately, it’s not the government who we think should pay for everything. It’s our employer. Every employee benefits manager has likely uttered this sentence before, “We aren’t telling you that you can’t have the treatment or procedure. We’re just telling you the company won’t pay for it.” It’s true but doesn’t sell well to most employees.

The long waits have created a black market medical economy in Canada, with secret shops like the underground MRI company I read about in Vancouver during my visit. If you have the cash and don’t mind flouting the law since it’s illegal, you can get an MRI in three days.

It reminded me of the Prohibition days when booze was illegal too, but available as long as you knew where to find the nearest speakeasy.

The Canadian system is based on the belief that all citizens should have access to health care regardless of ability to pay. In fact, the country’s health policy specifically outlaws a dual health-care system — one for those who can afford to pay and one for those who cannot.

We have quite a different philosophy in this country. One of my Canadian colleagues asked me how many Americans have no health insurance. I was embarrassed to report nearly 47 million.

The strange relationship between health insurance and employers is almost exclusive to the U.S. — caused by employers offering free health insurance instead of higher wages during WWII wage and price constraints. Health-care costs have contributed to the downfall of iconic companies like General Motors and Ford. Ironically, these automakers and other manufactures are moving production to Canada in order to have the Canadian government pay for most of their health-care costs.

According to the most recent government report, health-care spending now accounts for 16 percent of the U.S. GDP. That translates to $6,697 per person. U.S. employers assumed 74.4 percent of the bill for private health insurance in 2005. Employees paid 25.6 percent.

Although we spend more than twice as much as any other country on health care, we rank 37th in overall health-system performance, including infant and adult mortality and life expectancy.

By the end of the conference, I had heard numerous experts discuss the U.S. and Canadian health systems and the similarities and differences. One trend was clear: the Canadians are moving toward our private system while we're moving toward their public approach.

As the universal health care discussion begins anew, the most likely answer to the problem is missing — and probably somewhere in the middle.