A Reasonable Healthcare Contribution—At Last

For our readers who subscribe to the NY Times, today’s issue has a helpful opinion page article on healthcare by Jamie Daw. Dr. Daw teaches health policy and management at Columbia University. His piece is titled “A Better Path to Universal Health Care: The US should look to Germany, not Canada, for the best model.” In it, Daw does our work for us by responding in a fact-based, rational way to Kamala Harris’s reference to the elimination of insurance companies as part of the creation of “Medicare for All.”  

He points out, accurately, that Germany administers its healthcare though several hundred nonprofit providers. (See our Healthcare Research for a more detailed explanation of the German system.) They compete for customers based on service and price, thus preserving an element of competition. Germans choose their provider and contribute to the cost. Employers also contribute, regardless of the provider that the individual selects. Such insurance can then be portable when employment is changed. The government provides subsidies based on need. Daw’s opinion is that this approach is superior to a single-payer approach, like the system in Canada.

Whether he is right or wrong on this comparison, his discussion is helpful and productive. Regardless of the particular approach taken, the elimination of the profit margin as well as the costly process of underwriting and claims review incurred by the US administrative system is the single largest reason that the cost of healthcare in Germany and Canada is significantly lower than in the US.