Matt Miller was on NPR’s Marketplace on Tuesday. Miller was advocating the creation of a government controlled health system. While his arguments citing the benefits of nationalized health care are compelling, he does not address some of the drawbacks (e.g.: decreased technological innovation in a single payer system, increased risk of corruption, etc.).
The most interesting point Miller makes is the following: “If big-company health plans today are really just socialized health republics, for example–in which the young subsidize the old while everyone pays identical premiums–why shouldn’t this principle of risk pooling apply economy-wide?” Nationalized health insurance would certainly increase risk sharing, but they would drastically reduce consumer choice. Employers generally offer employees a few health care plans to choose from, and if the worker is still not satisfied, they can leave and find insurance at another firm. In other words, if large firms are republics, then individuals may exhibit Tiebout sorting by choosing employers whose benefit package best fits their needs and this phenomenon may or may not be inefficient.
For Miller’s full article, visit the Matt Miller website.