Alternative Medical Care Financing Systems: Implications for Minority Group Health Care and Welfare

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Abstract
At the 1951 AEA meetings, Jerome Rothenberg presented a paper discussing the "Welfare Implications of Alternative Methods of Financing Medical Care" from the point of view of society at large. Karen Davis, in her 1975 Brookings publication, National Health Insurance: Benefits, Costs, and Consequences, provides a detailed discussion of the complex set of economic and policy issues surrounding the question of private versus public financing of health care. Davis argues that the rationale for government intervention in the private health care financing market is based on the desire to correct three problems concerning the private market: (1) without assistance, low income people will not buy enough medical care, (2) prevailing kinds of health insurance do not encourage the efficient use of medical resources, and (3) the lack of competition in the medical care market contributes to high medical costs (p. 9). While Davis presents an excellent supporting set of statistics on insurance costs and coverage by type of insurer and socio-economic characteristics of the insured, the perspective is again from the point of view of society at large. Between and since the Rothenberg and Davis publications, there has been much discussion of the problems of financing health care.' Almost all of it has been from the perspective of society at large and centered around the three problems stated by Davis and cited above. The purpose of this paper is to discuss these problems with respect to access to medical care and economic welfare of black and other minority groups. For the purposes of this paper, the central problem facing a minority group is the prevalence of the state of poverty among its members. Therefore, the question asked of each of the health care financing alternatives discussed below are the following: (1) to what extent does it facilitate access to medical services by the poor? and (2) to what extent does it

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