In A conservative case for universal coverage, Yuval Levin briefly explains how two nations keep healthcare costs lower than ours without the rationing, long lines, denial of care, and poor quality of single-payer systems.
Switzerland has a system of universal, subsidized private insurance exchanges that look much like Paul Ryan’s Medicare-reform plan and Obamacare’s exchanges. Unlike Obamacare, however, the Swiss exchanges actually work. In Switzerland, there are no public options or government insurers like Medicare or Medicaid. Everyone is in the private system. The poor get a premium support subsidy that covers the cost of their premium; as one moves up the income ladder, the size of the subsidy decreases. Wealthy and upper-middle-class Swiss get no subsidy at all.
The Swiss system is no libertarian utopia; its exchanges contain some of the unattractive features of Obamacare, like an individual mandate and excessively broad benefit requirements. Nonetheless, as a percentage of GDP, Swiss public spending on health coverage is 60 percent lower than America’s. If we had the Swiss system, we wouldn’t have a budget deficit and we’d have no single-payer health entitlements like Medicare and Medicaid.
From a fiscal standpoint, Singapore is far better than even Switzerland. Singapore’s public spending on health care as a fraction of GDP is 86 percent lower than America’s. That’s because every Singaporean has a health-savings account, which is used to pay for non-catastrophic medical expenses. Singaporeans pay a payroll tax, which is then redirected into the HSA in a manner similar to our Social Security system. But unlike Social Security, the Singaporean HSA is controlled by the individual and supplemented with a government-sponsored catastrophic-coverage plan.
The bottom line is that Singapore and Switzerland spend far less on health care than we do and yet achieve all of the things that Americans value about their own system: choice, technology, and physician access. Conservatives have long considered universal coverage as a wacky left-wing goal. But these two countries prove that it’s possible to cover everyone in a way that would substantially shrink our government’s health spending and place individuals back in charge of their own health care dollars.