I am very interested in voucher plans but here is one source of my unease. Let's say you are given a voucher for a health insurance plan and there is no legal requirement that the plan cover Parkinson's. Many people buy plans which do not cover Parkinson's. Some of those people get Parkinson's. Are we pre-committing to ignore the woes of those people? If so, how exactly do we do this?
I'm not ruling this alternative out (there are plenty of cases where we let people die), I just want to know what are the surrounding institutional structures, what happens if these people show up at emergency rooms, and also whether this wouldn't, eventually, give rise to a new "second tier" of lower-quality public sector institutions to handle cases not covered by insurance.
That is indeed one possible reform: a UK-like system for those who gamble and lose, with higher quality care for those who buy the more comprehensive or the more balanced policies. (Maybe lots of people will buy gold-plated care for heart disease and nursing homes but go uncovered for neurological disorders, just to state one possibility.) You'll notice, however, a tension. The better the second-tier public-owned institutions, the more people will gamble with low or unbalanced levels of coverage. The UK-like system might take over large parts of health care, with a private insurance-based system for some subset of maladies only.
That's not the end of the world but perhaps it should be evaluated as such. You might already be thinking that parts of the nursing home and mental health sectors operate this way under the status quo.
There's also a longer-run question, namely whether the seniors would prefer to capture those resources in the form of social security benefits — cash — and take their chances with the publicly owned institutions to a greater degree. Maybe yes, maybe no, but those are the issues I think about when it comes to this kind of voucher plan.
At the other end of the spectrum, the law can mandate that the voucher-funded insurance plans cover lots and lots of conditions. Mandates don't stay modest, etc. In that case, is there really competition between the private insurance plans? What's the advantage of having private participation here if the insurance companies are regulated like public utilities and forced into a common price/quality mode?
It seems to me that the first set of alternatives are the relevant comparison.
One proposal for health care reform is to stipulate a total (fixed) budget for social security and Medicare together and then create a commission — controlled by Congressmen from Florida — to allocate the funds as is seen fit. I wonder what the resulting equilibrium would look like. Is that a politically acceptable way to institute a de facto voucher program?