noodling: medical loans

[castiron]

An idea I've been pondering for a society in one of my story worlds: Suppose that medical expenses, instead of being covered by insurance or by government payments, were covered by government-sponsored loans.


In the story's society, when you go to a doctor or are admitted to a hospital, there's two ways you can pay: you can pay cash (or personal credit card equivalent, if you so prefer), or you can take out a government-sponsored loan, which you pay back as you pay your regular taxes. There's a cap on required payments, based on percentage of your income. If you have health insurance, you still pay the doctor/hospital directly with cash or a loan, and the insurance company reimburses you/pays back the loan (or not, if they decide it's not a procedure they cover). There's some kind of loan payment pool for low-income people, and tax incentives for individuals and businesses to donate to the pool; there's also tax incentives for businesses to contribute to the loan payments of their employees.

Possible consequences of and questions raised by this system:

• (theoretically) Lower administrative costs, as hospitals and doctors don't need to deal with umpteen different insurance companies.


• Medical professionals get paid for work performed even if patient can't afford to pay up front; this might also lower medical costs.


• Funding for loans likely means higher taxes; depends on how well repayment works.


• The cap on required payments, while making it less likely that people will be ruined by medical bills, also means that some people who could pay the loan back ultimately won't, or will take a lot longer (though they'll be paying more interest too....).


• While the system might help people without insurance pay for expensive emergency procedures without going bank, presumably there'd still be a lot of people who don't go to a doctor because they don't want to/can't afford to spend the money, and end up with higher medical costs because they didn't catch a problem while it was minor.


• Can a person still get a medical loan if it's obvious they'll never be able to repay it? (e.g. person with chronic illness that costs more than their annual salary to treat) -- presumably the low-income pool is one way to ensure government still gets some money back, but will it be enough?


• What's the interest rate on these loans? Something low, to make it easier for people to pay back, or something high, so the government makes more money?


• If a loan is outstanding at a person's death, can they avoid having their estate taken for repayment by giving away their estate beforehand, or does one of these loans automatically result in a lien on your property?


• Who's responsible for the loans taken out to provide medical care for a child after the child turns eighteen -- the parents, or the child?


• Who hates this system more -- the people who'd rather have a government-funded system like single-payer, or the people who think government shouldn't be involved in medical care at all?

Comments

[anne]

Bureaucracy, if written right, can be a beautiful thing.