Republican presidential candidate Dr. Ben Carson has a healthcare reform proposal that's a reminder of why business and investment advisers long have made fun of physicians. Because they are experts in medical matters, doctors tend to think they are experts in everything.
Having interviewed hundreds of physicians over the years, I've found that even those who have not specifically studied health policy often think they know the solutions to the most intractable health policy dilemmas. Along comes Carson, who was director of pediatric neurosurgery at Johns Hopkins Children's Center, and who was undoubtedly a brilliant surgeon. He wants to perform radical surgery on Medicare and Medicaid. But his proposal shows little understanding of how health insurance works.
Carson, who leads the polls among Republicans in Iowa, told Fox News Sunday that he wants to make health savings accounts available to all Americans “from the time you are born until the time you die.”
He would fund this at least partly by using dollars now spent on Medicaid and Medicare. That “largely eliminates the need for people to be dependent on government programs” like Medicaid and Medicare, he said.
Still, he denies that he wants to eliminate the two giant healthcare insurance programs. If some Americans prefer to stay in Medicaid or Medicare rather than use his proposed new HSA program, “I'm not going to deny you the privilege of doing that,” he said.
Carson said that by giving poor people more control over their healthcare dollars, “You're teaching that person personal responsibility versus dependency.”
He previously proposed funding everyone's HSA with annual $2,000 government payments, which would come out to about $600 billion a year with the current U.S. population. To some extent, Carson seems to be borrowing ideas from a much-discussed 2009 article in the Atlantic Monthly by David Goldhill entitled "How American healthcare killed my father."
Goldhill, however, advocated HSAs in conjunction with a universal system of mandatory, very high-deductible health plans—not something that Carson, an ardent Obamacare foe, would likely consider.
Without more details than Carson has provided, it's impossible to fully evaluate his plan, or for the Congressional Budget Office to price it out. But it is possible to say that making Medicare and Medicaid voluntary programs would unravel the insurance risk pool in the same way that proposals to make Social Security voluntary would unravel the retirement safety net.
Younger, healthier and more affluent Americans could take Carson's government-provided HSA money and combine it with their own funds to buy comprehensive health insurance plans or pay for their own care out of pocket. But older, sicker and poorer Americans who wanted to stay in a government health insurance program would have to pay much higher premiums and likely accept less-comprehensive benefits because the safer insurance risks had exited the program.
Actuaries call that an insurance death spiral. That apparently lies outside Dr. Carson's medical expertise.