BAD MEDICINE
Health care proposals will backfire on state

I want to thank The Gazette for its strong editorial against the ill-considered plan by the Colorado Blue Ribbon Commission on Health Care Reform ("Health care reform: It's a joke," Jan. 31). Their proposed system of mandatory health insurance already has been tried in Massachusetts and is failing. Costs there are already more than three times what was originally predicted, and the Boston Globe reports that it is expected to "cut payments to doctors and hospitals, reduce choices for patients, and possibly increase how much patients have to pay." The California state legislature has also just rejected a similar plan because it will cost too much.

These government-imposed plans violate the rights of individuals to freely choose what health insurance plans are best for them, and, as a result, lead only to rising costs and rationing. If Coloradans value their lives and their health, they will also reject this deadly proposal.

For more information on genuine free market health care reform for Colorado, please see www.WeStandFIRM.org.

Paul Hsieh, M.D.
Sedalia

Labels: 208, CA, CO, LTE, MA, States

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The Senate Health Committee on Monday rejected Gov. Arnold Schwarzenegger's ambitious effort to reform the state's health care system, voting it down 7-1.

Only one of the committee's seven Democrats supported the bill. All four Republicans opposed it.

Even Senate President Pro Tem Don Perata, a co-author of the bill, came out against it.

The Democrats who voted against the bill or failed to vote said they were afraid the cost of the program would be too great, especially as California faces a $14.5 billion budget shortfall.

Labels: CA, States

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Compulsory Medical Insurance as Collective Punishment

Remember how in grade school, the teacher would punish the whole class for the actions of just a few disruptive students? This is an early lesson in collective punishment, which is usually practiced during wartime or under martial law.

Collective punishment has now arrived with compulsory medical insurance. Known as an "individual mandate," politicians of both major parties have supported it. Compulsory politically-defined insurance is law in Massachusetts, is up for consideration in California and Colorado, and Democratic presidential candidates endorse it nationally.

Politicians peddle compulsory insurance under the guise of "personal responsibility." The story is that the uninsured receive medical care without paying for it. Their freeloading passes costs onto the insured, which increases premium costs. Compulsory insurance, say its supporters, can remedy this problem by forcing both the insured and uninsured to purchase medical insurance - as defined by politicians.

This rationale is flawed. First, freeloading from the uninsured does not significantly increase insurance premiums.

Paying the medical bills for the uninsured adds little to insurance premiums - and certainly less than Colorado's scheme for compulsory insurance. A study published in Health Affairs found that uncompensated care is "only 2.8 percent of total personal health care spending," of which our tax dollars - not increased premiums - fund at least 80 percent.

In Colorado, the Lewin Group found uncompensated care to be less than four percent of total medical spending. The portion of uncompensated care that can correspond to increased premiums is around $200 million annually. This is just $85 per privately-insured resident, or one percent of the average premium.

But the billion-dollar "cure" proposed by Colorado's Commission on Healthcare Reform would cost the insured more than $85. To encourage compliance with compulsory insurance, the Commission's plan includes tax-subsidized premiums and Medicaid expansion. Privately-insured Colorado resident, the tax increase would cost about $400.

Second, holding people responsible would mean punishing freeloaders themselves and allowing providers to prevent customers from skipping out on the bill. This is the exact opposite of compulsory insurance, which forces the innocent to purchase insurance policies determined by political interests, rather than their own needs. This is collective punishment.

What if we applied the rationale for compulsory medical insurance to freeloaders who leave restaurants without paying the bill? This certainly increases prices, but forcing all citizens to purchase "diner's insurance" punishes the innocent.

Third, government controls already punish the innocent - insured and uninsured alike - by making medical care and insurance prohibitively expensive.

The federal tax exemption for employer-provided insurance coddles insurance companies by tying employees to their employer's plans, effectively discounting insurance, and shielding insurance companies from competition. It also drives demand for more comprehensive insurance than would otherwise be purchased. Insulated from medical costs, patients behave like business travelers on a company expense account, so medical providers need not compete on price. Shall we further pamper insurance companies by forcing everyone to purchase their products?

On the state level, medical providers and disease constituencies lobby to force insurance to include benefits that many customers do not need. For example, Colorado law compels widowed wives to pay higher premiums for prostate screening, maternity, and marital therapy. These mandates increase Colorado premiums by 21 to 54 percent, which dwarfs the one percent increase attributable to the uninsured. Colorado's Chief Medical Officer states that 2,500 Coloradans lose insurance for every one percent increase in premiums. Nationally, the figure is 300,000 people. These controls also reduce wages and are responsible for up to twenty-five percent of America's uninsured.

Compulsory insurance further empowers politicians to determine what insurance is best for you. For example, the Boston Globe reports that under the Massachusetts plan, "more than 200,000 people with health insurance would have to buy additional coverage to meet proposed minimum standards under the state's new health insurance law."

When government policies increase insurance costs, the first to drop coverage are the young and healthy. Those remaining in the insurance pool are at higher risk to incur medical expenses, so premiums rise again, which again drives out the healthiest remaining customers. It takes some nerve to support policies that make insurance prohibitively expensive and then make it a crime not to purchase insurance.

Compulsory insurance is based on collective punishment, a perverted form of justice found where troops patrol the streets and spitballs go splat. It punishes both the insured and uninsured for the misdeeds of politicians. Legislators should stop scapegoating the uninsured for the mess they've perpetuated. They should repeal legislation that inhibits the free market from delivering affordable high-quality medical care.

Brian T. Schwartz, Ph.D. is an optical engineer and an aspiring professional policy analyst in Boulder, Colorado. His website is wakalix.com.

Labels: CA, CO, Insurance, MA, OpEd

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The Right Vision Of Health Care
Yaron Brook 1.08.2008

With the primary season in full swing, the presidential candidates are fighting over what to do about the spiraling cost of health care--especially the cost of health insurance, which is becoming prohibitively expensive for millions of Americans.

The Democrats, not surprisingly, are proposing a massive increase in government control, with some even calling for the outright socialism of a single-payer system. Republicans are attacking this "solution." But although they claim to oppose the expansion of government interference in medicine, Republicans don't, in fact, have a good track record of fighting it.

Indeed, Republicans have been responsible for major expansions of government health care programs: As governor of Massachusetts, Mitt Romney oversaw the enactment of the nation's first "universal coverage" plan, initially estimated at $1.5 billion per year but already overrunning cost projections. Arnold Schwarzenegger, who pledged not to raise any new taxes, has just pushed through his own "universal coverage" measure, projected to cost Californians more than $14 billion. And President Bush's colossal prescription drug entitlement--expected to cost taxpayers more than $1.2 trillion over the next decade--was the largest expansion of government control over health care in 40 years.

Today, nearly half of all spending on health care in America is government spending. Why, despite their lip service to free markets, have Republicans actually helped fuel the growth of socialized medicine and erode what remains of free-market medicine in this country?

Consider the basic factor that has driven the expansion of government medicine in America.

Prior to the government's entrance into the medical field, health care was regarded as a product to be traded voluntarily on a free market--no different from food, clothing, or any other important good or service. Medical providers competed to provide the best quality services at the lowest possible prices. Virtually all Americans could afford basic health care, while those few who could not were able to rely on abundant private charity.

Had this freedom been allowed to endure, Americans' rising productivity would have allowed them to buy better and better health care, just as, today, we buy better and more varied food and clothing than people did a century ago. There would be no crisis of affordability, as there isn't for food or clothing.

But by the time Medicare and Medicaid were enacted in 1965, this view of health care as an economic product--for which each individual must assume responsibility--had given way to a view of health care as a "right," an unearned "entitlement," to be provided at others' expense.

This entitlement mentality fueled the rise of our current third-party-payer system, a blend of government programs, such as Medicare and Medicaid, together with government-controlled employer-based health insurance (itself spawned by perverse tax incentives during the wage and price controls of World War II).

Today, what we have is not a system grounded in American individualism, but a collectivist system that aims to relieve the individual of the "burden" of paying for his own health care by coercively imposing its costs on his neighbors. For every dollar's worth of hospital care a patient consumes, that patient pays only about 3 cents out-of-pocket; the rest is paid by third-party coverage. And for the health care system as a whole, patients pay only about 14%.

The result of shifting the responsibility for health care costs away from the individuals who accrue them was an explosion in spending.

In a system in which someone else is footing the bill, consumers, encouraged to regard health care as a "right," demand medical services without having to consider their real price. When, through the 1970s and 1980s, this artificially inflated consumer demand sent expenditures soaring out of control, the government cracked down by enacting further coercive measures: price controls on medical services, cuts to medical benefits, and a crushing burden of regulations on every aspect of the health care system.

As each new intervention further distorted the health care market, driving up costs and lowering quality, belligerent voices demanded still further interventions to preserve the "right" to health care. And Republican politicians--not daring to challenge the notion of such a "right"--have, like Romney, Schwarzenegger and Bush, outdone even the Democrats in expanding government health care.

The solution to this ongoing crisis is to recognize that the very idea of a "right" to health care is a perversion. There can be no such thing as a "right" to products or services created by the effort of others, and this most definitely includes medical products and services. Rights, as our founding fathers conceived them, are not claims to economic goods, but freedoms of action.

You are free to see a doctor and pay him for his services--no one may forcibly prevent you from doing so. But you do not have a "right" to force the doctor to treat you without charge or to force others to pay for your treatment. The rights of some cannot require the coercion and sacrifice of others.

So long as Republicans fail to challenge the concept of a "right" to health care, their appeals to "market-based" solutions are worse than empty words. They will continue to abet the Democrats' expansion of government interference in medicine, right up to the dead end of a completely socialized system.

By contrast, the rejection of the entitlement mentality in favor of a proper conception of rights would provide the moral basis for real and lasting solutions to our health care problems--for breaking the regulatory chains stifling the medical industry; for lifting the government incentives that created our dysfunctional, employer-based insurance system; for inaugurating a gradual phase-out of all government health care programs, especially Medicare and Medicaid; and for restoring a true free market in medical care.

Such sweeping reforms would unleash the power of capitalism in the medical industry. They would provide the freedom for entrepreneurs motivated by profit to compete with each other to offer the best quality medical services at the lowest prices, driving innovation and bringing affordable medical care, once again, into the reach of all Americans.

Yaron Brook is managing director of BH Equity Research and executive director of the Ayn Rand Institute.

Labels: Analysis, CA, Free Market, MA, Medicaid, Medicare, OpEd

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Health care only appears to cost less in Canada than the U.S. because Canadian public health insurance does not cover many advanced medical treatments and technologies commonly available in the U.S.

Canadian patients do not get the same quality or quantity of care as American patients.

On a comparable basis, Canadians have fewer doctors, less high-tech equipment, older hospitals, and receive fewer advanced medicines than Americans.

Canadians currently wait an average of almost 18 weeks between the time they see their family physician and the time they receive treatment from a specialist.

11 per cent waited longer than three months to see a specialist

17 per cent waited longer than three months to get necessary non-emergency surgery

12 per cent waited longer than three months to get necessary diagnostic tests.

Labels: CA, Canada, Countries, States

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