Does access to adequate and affordable healthcare require a trade-off between equality and liberty? What kind of health care system is most effective? Benjamin J. Krohmal and Ezekiel J. Emanuel’s essay “Tiers Without Tears: The Ethics of a Two-Tier Health Care System” addresses these questions, assessing the arguments for and against single and dual-tiered healthcare systems in the US and drawing connections with historically reliable systems in the Netherlands and Britain. A single-tier system offers what appears to be a just system whereby a single standard of care is offered to all, regardless of their purchasing power, with the intention of keeping everyone equally healthy, to the best of our ability. A dual-tier system, like the one in the US, is part of a market economy and restricts access to adequate care to an elite few. Drawing on Krohmal and Emanuel, I aim to defend the efficacy and moral cogency of a two-tiered system.
One side of this debate denounces the US system on the grounds that health equality is necessary for justice. John Rawls and Norman Daniels in his book Just Health Care both offer unique perspectives on equality of opportunity. Rawls argues that we should remove all arbitrary contingencies that affect health and hence inhibit people from pursuing their life goals. Daniels argues that physiological wellness is necessary to secure fairness of opportunity and facilitate individual agency. Both agree that a healthcare system is just only when it works towards the equality of all citizens. For them, equality cannot be attained if the affluent have access to better health care. Rawls also invokes the difference principle. To understand this, take a track and field race. Certain athletes are faster than others. The only way to establish justice is for the inferior athletes to begin the race with a slight head start. An analogy with healthcare systems could be made here.
A market system involves macroeconomic trade-offs, practitioner incentives, individual liberty and, importantly, the foundational economic principle of resource scarcity. The US national expenditure on health care, including Medicare and Medicaid, was projected to exceed $1.2 trillion in 2020. Undoubtedly, Covid-19 has exacerbated these expenses. Given finite resources, Daniels argues that some health care funds should be reallocated to other social provisions, such as education, housing, etc., which also promote human flourishing. The bloat and hypertaxation produced by a single-tier healthcare system make this economically impossible. A privatized healthcare tier incentivizes physicians and surgeons to treat the wealthiest patients. Not all citizens can afford healthcare. A single-tier system makes it difficult to cover equipment costs and prevents physicians from receiving adequate compensation—especially for complex, laborious procedures. The introduction of a single-tier system therefore encroaches on the liberties of those who want private or specialized care. A free society guarantees people’s ability to make their own decisions, especially as to how to spend their money. Healthcare is as much a commodifiable service as it is a fundamental right. While adequate care should be guaranteed to all, we do not necessarily need a single standard of care. This would deny people the option to seek alternative care and would therefore be unjust. At the margin, healthcare is no more important than any other commodity that people are free to buy and sell as they see fit. Individuals should be free to purchase more and better healthcare if they can afford it. In Four Essays on Liberty, Isaiah Berlin declares, “To block man from every door but one, no matter how noble the prospect upon which it opens, or how benevolent the motives of those who arrange this, is to sin against the truth that he is a man, a being with a life of his own to live.” Egalitarianism and liberty are both essential and they are not mutually exclusive.
Fortunately, an ethical two-tier system could prevent some of the damage caused by unequal access to care, while allowing for free choice. An ethical market tier system for the US must fulfill five criteria:
- A core benefits package covering an adequate level of healthcare.
- The core benefits package should be guaranteed to all Americans, without means testing.
- The core benefits package should be designed such that a sizeable majority of the population are happy to access it, without needing to supplement it with the market tier.
- The purchase of market tier services and coverage should be made with after-tax dollars and should not provide an exemption from tax obligations to support the core benefits package.
- Easy adjustment of the core benefits package should be possible in response to changes in technology, data about efficacy and demand for market tier services.
This would be conducive to both egalitarianism and economic liberty. It would establish a public tier of affordable, sufficient care, providing adequate minimum health coverage for all citizens, together with a market tier for those who wish and can afford it. The US is a major outlier among the many nations who have adopted a group-based model of health care, given healthcare’s relatively small share in public finance and the huge proportion of the population who are under- or uninsured. Compare the Dutch market tier system. The Dekker reform of the late 1980s remodeled the Dutch system with the aim of vastly improving its equity and efficiency. A mandated national health insurance policy covering 85% of total expenditure on health and social care was implemented, guaranteeing universal access to basic care, while regulated competition was introduced to create incentives for both insurers and providers to perform supplementary care at whatever price they deemed fair. This model had two crucial components. First, national health insurance was to be financed primarily by income contributions collected through an earmarked taxation system. The funds would then be amassed in a central fund managed by an independent but government-regulated statutory body that redistributed those funds depending on the number of people insured and their risk groupings. This accords with the principle of greater health, not equal health. The goal of healthcare is to provide care for all and to provide urgent and necessary care to everyone, regardless of their financial status. A just system ensures that everyone has as much care as they need, when they need it, but does not prevent any group from purchasing additional care on the grounds of strict egalitarianism. The Dutch model also removed the legal distinction between private and public health insurers, enabling both types to offer basic coverage and supplementary health insurance.
Essentially, the Dekker system disincentivized physicians and citizens from using a private tier to compensate for substandard care (in the case of the patient) or unsatisfactory remuneration (in the case of the doctor). This satisfies the interests of both physicians and citizens. The British model is another example of an ethical market system design. In Britain, a small, niche-oriented private system exists symbiotically with a universally offered public tier. The private tier is dependent on the public system for public service consultant physicians. As in the Netherlands, the base tier provides adequate health coverage, which disincentives the affluent from seeking private care, reduces doctors’ incentives to treat only private patients and improves care for the underprivileged. The UK’s private expenditure consists of private insurance and out of pocket payments. A small proportion of UK citizens have private insurance—estimated at roughly 11.5 percent in 1998: the proportion of private finance in total health care spending is roughly 11 percent. This percentage has remained more or less stable over the period 1990–2015. As these examples show, in Europe there is little demand for privatized care and it is seldom relied upon, but it remains an option for those who desire it.
An ethically designed two-tier system neglects neither liberty nor equality. A single-tier, government-regulated system is—under the guise of equality of opportunity—systematically coercive and unduly paternalistic. A single-tier system prevents the wealthy from seeking the care they deem appropriate, while utilizing taxation as a method of social redistribution for the poor. Imagine a fertile cow who produces milk in abundance as opposed to other cattle who produce very little. Her farmer takes away a significant portion of the milk she produces and sells it for money. The farmer uses that money to buy feed for the cattle and each cow is given the same subpar feed. Although very productive, the cow producing the milk which helps buy the food has no other meal choices than the poor feed that is given to all other cows, yet still produces the milk used to buy it. This kind of system hardly seems in the best interest of anyone and simultaneously infringes on the liberty of the productive, albeit advantaged members of society.
As Jan Narveson and James Sterba argue in their book Are Liberty and Equality Compatible, the rich are not morally required to make the sacrifice a single-tier system entails and it is unreasonable to demand it of them. A just double-tier system would provide publicly funded health coverage to all, ensure everyone’s health improved and induce most citizens to be content with the provisions of the base tier. But those with the money to do so would have the freedom to purchase supplementary care.
The primary concern should be the provision of adequate care for all. Justice is often misconstrued to mean the elimination of particular advances for some and not others and quite frequently results in the erosion of negative liberty, an irrevocable aspect of free societies. Equality dictates a minimum satisfactory level of welfare for all, never to be abated for the many for the advancement of the few. On the other hand, liberty, here, means free choice and is incompatible with imposing limitations on the rich to try to make them more equal to the disadvantaged. A two-tiered healthcare system would allow both liberty and equality to flourish.