Policy Documents

The Freedom to Spend Your Own Money on Medical Care: A Common Casualty of Universal Coverage

Kent Masterson Brown –
October 15, 2007

In this Policy Analysis, the author writes that most people would agree that a patient should always be able to spend his own money on the health care services he desires. Yet that freedom is often threatened or denied when government tries to provide universal health insurance coverage, as in the U.S. Medicare program, which provides health insurance to seniors and people with disabilities. Over the past 20 years, the Medicare bureaucracy—and to a lesser extent Congress itself—has limited the freedom of Medicare beneficiaries to purchase medical services with their own money. Those limitations violate beneficiaries’ right to privacy, undermine a tool that could reduce the burden Medicare imposes on taxpayers, and may deny care to Medicare beneficiaries outright, or deny them access to the highest quality care available.

As the U.S. government has restricted the ability of patients to spend their own money on medical care, Canada’s socialized health care system is moving in the opposite direction. In a landmark case handed down in 2005, the Supreme Court of Canada ruled that the province of Quebec could not prohibit its citizens from purchasing covered services through private health insurance. That ruling recognized that imposing limits on a patient’s freedom to spend his own money can result in his being denied crucial and even life-saving medical services.

This threat to patients’ rights would grow under many proposals to have the federal or state governments provide universal coverage. Congress and the state legislatures should avoid universal coverage schemes that would undermine this fundamental human right, or tempt future legislatures and bureaucrats to do so. Instead, Congress should restore to American seniors the unfettered right to spend their own money on medical care.