77 Pages Posted: 5 Feb 2007
This article explores the hypothesis that the U.S. health care system operates more like a robber baron than like Robin Hood, burdening ordinary payers of health insurance premiums disproportionately for the benefit of industry interests and higher-income consumer-taxpayers. Thus, lower- and middle-income Americans with health coverage pay not only for their own families' health care but also to support a vast health care enterprise that primarily benefits others, including many far more affluent than themselves. The system is able to finance itself in part because U.S.-style health insurance greatly amplifies price-gouging opportunities for health care firms with market power, creating a cost burden that falls ultimately on all premium payers equally, like a severely regressive head tax. Moreover, these same consumers also bear excessive costs for their own health care because, not seeing the costs they bear with any clarity (since the tax system makes those costs appear to fall on their employers rather than themselves), they demand unnecessarily costly coverage and resist efforts to economize - all to the benefit of the health care industry and others with reasons to value high-cost medicine. Lower-income insureds also appear, for several reasons, to get less out of their employers' health plans than their higher-income coworkers, despite paying the same premiums. Finally, insured individuals' lack of cost-consciousness also affects their attitudes and behavior as citizens and as voters, enabling politicians as well as industry interests to make choices on their behalf that systematically raise costs and foreclose economizing possibilities. The burden of excess health care costs and how it is distributed is rarely recognized as the fundamental issue of social justice it is. The purpose of this article is to make the question who pays and who benefits a principal concern of health policymakers.
Suggested Citation: Suggested Citation
Havighurst, Clark C. and Richman, Barak D., Distributive Injustice(s) in American Health Care. Law and Contemporary Problems, Vol. 69, No. 4, 2006; Duke Law School Legal Studies Paper No. 140. Available at SSRN: https://ssrn.com/abstract=959643