Do We Need a Single Payer System?

Posted by on November 15, 2012

Health care is a hot topic and was a major issue during the recent elections.  Rising health care costs is a global issue.  There are no quick fixes or easy solutions, but there are options.

Dr. William HsaioThe monthly newsletter, Collaborative recently shared some information from a global health care economist.  William Hsiao, PhD is a Harvard health care economist that has worked with countries around the world to help fix their health care systems.  Dr. Hsaio is well known in the academic world for developing strategies to simplify and streamline health care systems and keep costs under control.

The program he designed in Taiwan reduced the cost of health care to 7% of GDP (compared to 18% here). His program includes health care financial protection for almost all, created a nationwide database with most hospitals and doctors transacting their business electronically, and changed the way that health care providers are paid. Taiwan’s administrative costs for health care are currently one of the lowest in the world.

Dr. Hsaio’s philosophy is simple, the health care system used in a country impacts the economy of that country.  A healthier population provides economic value.  Having some level of health care coverage for all and an efficient system of delivery and payment go together in his mind. 

Being an economist focusing on efficiency and cost-effectiveness means that Dr. Hsaio leans toward a single-payer model as a solution worth consideration.  His support is for single payer, not necessarily government run health care. 

Eliminating the duplication and administrative overhead necessary with multiple payers by moving to a single payer system makes the system simpler and less expensive.  Dr. Hsaio believes the US will always have a more expensive health care system as there are more stakeholders and choices involved, but there is a great need to control costs.Health Care Management  Reducing administrative costs is a good way to start.

Dr. Hsaio and his colleagues have given up on the US though as no one will listen.  They spend most of their time overseas where the message is better received and then considered. He believes the US is making decisions based on ideology and beliefs rather than on economic reality.

There may be a need to educate our leaders so they are open to considering other options.  Our health care costs are continuing to increase and changes need to be made.  Students at Minnesota School of Business stay involved and informed on the issues in health care.  Graduates in this dynamic field will have an impact on our system.

Jerry Lovrien has held positions of Chief Executive Officer at health and behavioral health facilities in Minnesota and Washington State. He served successfully as State Director/Commissioner of Health and Behavioral Health in Georgia, West Virginia and Minnesota. Jerry has taught high school through graduate courses and is currently an Instructor with Minnesota School of Business.

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