I used to be in favor of universal healthcare. Now I'm for it in principle (i.e. I am in favor of making changes that would drastically expand the availability of healthcare), but against how most of its supporters propose going about it.
The solution requiring the least thought is to simply mandate that everyone have health insurance. But this presupposes that insurance is the best model for financing healthcare. It isn't. To see why it's not, look at car insurance.
Cars are similar to human bodies in several ways, yet the insurance industries that govern their care react to those shared characteristics very differently. Cars and human bodies both require maintenance for the duration of their operational lives. Cars and human bodies are both vulnerable to accidents and other infrequent, expensive, unforseen sources of damage.
Insurance is a mechanism for blunting the impact of infrequent, expensive, unforseen events. Maintenance is not infrequent, not unforseen, and usually not expensive (at least not in comparison to accidents). Insurance is not a sensible means to finance maintenance.
Car insurance has the correct relationship to automotive care, because it handles only the accidental half -- the infrequent, expensive, unforseen half. It leaves the maintenance half in the hands of the free market. (Imagine if it were otherwise: To get an oil change, you'd have to visit your Primary Care Mechanic, chosen from an insurance-approved directory of mechanics, and hand him your insurance card and a $15 copay. And your car insurance premiums would be at least three times what they are now.)
Insurance works by pooling risk. In order for it to work, the risk must be low enough that most members of the pool will not actually suffer the fruition of that risk. But the "risk" of maintenance is high -- it's guaranteed that every member will suffer from its fruition. Therefore pooling the maintenance risk doesn't help anyone except the insurance company; in theory, the premiums required to finance such pooling are guaranteed to at least equal, if not exceed, the cost that pool member would pay to obtain the same maintenance on the open market.
Here is where the analogy between cars and human bodies breaks down. If the maintenance of human bodies were handled by the free market in the same way as the maintenance of cars, the prices would be extraordinarily higher. This is the only reason the square peg of the insurance model has been pounded into the round hole of healthcare maintenance: the free-market costs of the maintenance are so high that, despite the theory, even exorbitant premiums still end up being cheaper. Releasing health care maintenance to the free market would essentially eliminate that market, as providers priced themselves beyond their prospective consumers' reach.
I believe the correct implementation of universal healthcare is not to expand the inefficient and ill-fitting pooling of "risk" (risk whose likelihood is much closer to 100% than to 0%) offered by insurance, but rather to lower cost to the point that healthcare maintenance can actually survive on the open market.
So, why is the maintenance cost for human bodies so much higher than for cars? Supply and demand. The supply of maintenance expertise is much more plentiful for cars than it is for human bodies. This is because there is no stratification of knowledge for medicine the way there is for car care. Certainly it requires highly paid, highly educated engineers to design cars, but you don't need one of them to rotate your tires or check an air filter. There exists an entire stratum of providers of medium-to-low automotive expertise that suffices for the vast majority of maintenance needs. In medicine, by contrast, even the lowliest neighborhood general practitioner has a college education that was at least as extensive and costly as the education received by the car-designing engineer. The costs of medical education are so high that they must necessarily (a) heighten the medical barrier-to-entry, constricting the flow of new doctors into the market, and (b) be passed on to the patients so the doctors who do make it into the market can hope to make a profit despite the vicious monkey of student loans perched menacingly and omnipresently on their backs.
Not only is medical expertise in shorter supply than automotive expertise, but it is also in higher demand. The owner of a car always has a choice before paying for maintenance. Frequently owners would rather let their car die and purchase another one than undertake some expensive maintenance operation. Such a choice rarely exists for the owners of human bodies. We each get only one body; the decision of whether to seek maintenance for it at all has already been made, in the affirmative, from the getgo. And no one can decide to eschew the whole owning-a-body nonsense by always riding a bike or taking the subway.
In order for healthcare to be made market-ready, steps must be taken to increase the supply of medical expertise and lower its demand.
Insurance companies must be given credit for recognizing the second half of that statement. Many insurance companies now operate incentive plans that attach financial reward (in the form of premium reductions or rebates) to habits that promote good health, like walking more, joining a gym, or quitting smoking. These are a good idea, but they don't go far enough. I believe that the Surgeon General, the Food and Drug Administration, the National Institute of Health, the American Medical Association, and the Center for Disease Control should collaborate to produce a measurable definition of what it means to be healthy, sufficiently rigorous and concise that it can be used as a legal standard. Anyone who wants to can submit to a test administered by their doctor that determines whether they meet this standard, and if they do, the doctor issues them a legal certificate that can be redeemed for a nontrivial income tax break.
Unfortunately, the insurance companies do not seem interested in tackling the other side of the problem, increasing the supply of medical expertise. This is because the insurance companies currently find themselves in a position analogous to the Department of Defense. Both use the legitimate importance of their missions to accumulate way more wealth than even those missions deserve, and inject that money into a tiny market of high-expertise vendors. Doctors and hospitals are the high-priced defense contractors of healthcare, and insurance companies are the bureaucratic, insular Pentagons that pay their exorbitant fees.
I believe the solution to increasing the supply of medical expertise is simple: someone should completely subsidize the cost of all medical education. Tuition, books, housing, everything. Anyone who wants to pursue an M.D. should be able to do so 100% free of charge.
I say "someone" not because I'm a whackjob liberal who likes it when mysterious fairies wave wands that magically take care of real-world concerns. I say it because it wouldn't necessarily have to be the government that does the subsidizing. Even large corporate employers are getting tired of the insurance model of healthcare finance. It might well prove cheaper for them in the long run to jettison their insurance fees in favor of voluntarily contributing to a private nonprofit consortium (that, for tax purposes, would count as a charitable donation) that subsidizes medical education without any government involvement.
It would be hard to maintain the current high price of healthcare if there were ten times as many doctors available as there are now, all equally as competent and qualified as the current population of doctors (and none with student loans). This proliferation of private medical practices would also force down the cost of niche pieces of high-tech medical equipment. MRI machines cost $2 million each not because they run on plutonium or need to withstand atmospheric reentry from space, but because their manufacturers know in advance that they'll have only 1,000 prospective buyers per year. If that market expanded to tens or even hundreds of thousands, manufacturers would gladly lower their prices to ensure dominance of the newly expanded market.
None of this is to say that the insurance model should be dismantled for healthcare "accidents" -- cancer, Alzheimer's, Lou Gehrig's disease, multiple sclerosis, etc. These are all infrequent, expensive, unforseen things that fit well with the pooling of risk. But if those were the only things covered by health insurance, premiums would necessarily go down.
Government intervention is bad for healthy markets, but the healthcare market is anything but healthy. The way to make it well again is by throwing more doctors -- not bureaucrats, either government or corporate -- at the problem.