A simple proposal for health care

In the last Presidential debate, the candidates talked about their health care proposals (or more accurately, why the other guy's proposals were terrible.) Neither candidate was willing to endorse a single-payer system; that seems to be the "third rail" of U.S. health care policy. Yet the private insurance market we've got is working none too well: The U.S. pays by far the most for its health care, both in absolute terms and as a percentage of GDP, compared to other industrialized countries, yet the quality of care that U.S. residents receive is among the poorest of all those countries, and 47 million Americans are without health insurance.

The private market isn't working, but a single-payer system won't fly politically, so let me humbly propose a system that might:

First, the U.S. Government would split the country into four regions, Northeast, Northwest, Southeast and Southwest. The right to sell health insurance would be auctioned off in each region, just as the FCC auctions licenses to use the airwaves. The highest bidder would win the right to be the sole health insurance provider in that region, and the license fees would go to help pay the Government's part of this plan.

The insurance companies would all have to play under the same basic rules: No limitations for pre-existing conditions. No exclusion of conditions. No waiting periods. No one can be turned down. Personal insurance rates would be set based on age and family size. Companies would have the choice of buying their own insurance for employees, subsidizing employees who purchase insurance, or letting employees get insurance on their own. Everyone would have to get insurance from their employers or purchase it themselves.

The Federal Government would provide reinsurance to the insurance companies for catastrophic illnesses, thus eliminating the reason for insurance companies not to cover patients with AIDS, cancer and other life-threatening diseases. The license fees paid by the insurers would go into the reinsurance fund.

With a single insurance company to deal with in each region, administrative costs for health care providers would go down dramatically, which should result in lower costs. The licensed insurance companies would have far more leverage to negotiate prices with health care providers and drug companies.

This system would allow just about everyone to get insurance at affordable rates, and would maintain a multi-payer system. It would lower (or at least stabilize) costs. And, it would force insurers to pay for their participation in the system with license fees. Senators McCain and Obama, you're welcome.