Gorman warns that this bill would, "give the Executive Director of Health Care Policy and Financing the power to create a database to collect and store unlimited information on everyone who provides or receives health care in Colorado whether or not the state pays for that health care and whether or not the transaction is a private one."
Gorman notes, "Some people in the Colorado legislature think that everyone should pay the same price for individual health insurance regardless of age, personal habits, or gender. They believe this even though women as a group use more health care than men. They cling tight to the belief that charging someone a lower price for health insurance simply because he uses less health care is, in the language of the bill, 'unfairly discriminatory and shall not be allowed.'"
Ironically she observes, "The Colorado legislature actually helps ensure that women's health insurance premiums cost more."
On a positive note, Indiana governor Mitch Daniels praises health savings accounts in his March 1, 2010 Wall Street Journal essay, "Hoosiers and Health Savings Accounts".
Daniels writes:
Are HSA participants denying themselves needed care in order to save money? The answer, as far as the state of Indiana and Mercer Consulting can find, is no. There is no evidence HSA members are more likely to defer needed care or common-sense preventive measures such as routine physicals or mammograms.
It turns out that, when someone is spending his own money alone for routine expenses, he is far more likely to ask the questions he would ask if purchasing any other good or service: "Is there a generic version of that drug?" "Didn't I take that same test just recently?" "Where can I get the colonoscopy at the best price?"
To the extent that the free market is allowed to operate, patient receive quality care for lower prices. Surprise, surprise!
My theme is that Boulder's congressman Jared Polis (a very liberal Democrat) should drop has latest proposal for a "public option" and instead support free market health care reforms -- because it would be both good policy and good politics.
Here is the introduction:
Boulder's Congressman Jared Polis recently made national headlines when he and fellow first-term Congresswoman Chellie Pingree (D-Maine) teamed up to petition the U.S. Senate to include the so-called "public option" in its next version of health care legislation.
Polis' move was an attempt to break the political stalemate between the House and the Senate following Republican Scott Brown's upset election victory in Massachusetts. After Brown's election deprived Senate Democrats of the 60-vote supermajority necessary to pass the current version of ObamaCare, the House and Senate have struggled to bridge the differences between their respective versions of health legislation. In particular, one key difference has been the government-run "public plan" to compete with private insurance plans, which House liberals (including Polis) supported but which the Senate rejected.
Unfortunately, Polis' "public plan" is both bad policy and bad politics...
In particular, I mention the fact that Polis' views are out of step with what Americans want. Hence, he could alienate many independent voters here in Colorado.
Could a version of the Massachusetts election upset also happen here in liberal Boulder, Colorado?
...[C]onservative lawmakers in about half the states are forging ahead with constitutional amendments to ban government health insurance mandates.
The proposals would assert a state-based right for people to pay medical bills from their own pocketbooks and prohibit penalties against those who refuse to carry health insurance.
In many states, the proposals began as a backlash to Democratic health care plans pending in Congress. But instead of backing away after a Massachusetts election gave Senate Republicans the filibuster power to halt the health care legislation, many state lawmakers are ramping up their efforts with new enthusiasm....
Lawmakers in 34 states have filed or proposed amendments to their state constitutions or statutes rejecting health insurance mandates, according to the American Legislative Exchange Council, a nonprofit group that promotes limited government that is helping coordinate the efforts. Many of those proposals are targeted for the November ballot, assuring that health care remains a hot topic as hundreds of federal and state lawmakers face re-election.
As Obama Care becomes closer to reality, we in Colorado have the right to say "No." This is a chance for freedom loving people from across the state to come together and send the Colorado General assembly a simple message: Defend Colorado against Obama Care in the legislature, or we the people will do it at the ballot.
At the rally, we will be introducing language for a ballot initiative to amend the Colorado Constitution to excempt Colorado from Obama Care. We need to send a very strong and unified message to lawmakers that while we want them to say yes to defending Colorado, we are also ready, willing and able to move forward with the citizen initative process should the legislature fail us.
When: January 19th @ Noon Where: West steps, Capitol building
...Jon Caldara and the Independence Institute moved Colorado another step toward its own brand of health care reform, filing with state officials a proposed amendment to the Colorado Bill of Rights called the "Right to health care choice."
...The amendment would forbid government from forcing individuals to buy private health insurance -- an attempt to counter proposed federal legislation. It would preserve the rights of individuals to pay cash for health care services, and it would uphold the right of Coloradans to buy health insurance plans from providers in other states.
The House and Senate versions of proposed federal health care reform would greatly restrict the rights of individuals to make their own health care decisions. The proposed amendment, if upheld by the courts, could make Colorado a unique enclave of health care freedom of choice.
In other words, at a Town Hall meeting, where politicians invite people to come and speak, politicians expect people to shut up and take it.
According to Congressman Perlmutter, forcibly confiscating people's money is not "thuggery." Forcing some people to subsidize others through a maze of insurance controls and mandates is not "thuggery." Dictating to doctors how they shall provide health care, to patients how they shall receive it, and to insurers how they shall insure it, is not "thuggery."
But complaining about it, that is "thuggery." Speaking up is "thuggery." Saying "no" to Big Brother is "thuggery." Daring to exercise the First Amendment is "thuggery." According to Congressman Perlmutter.
Schroeder Critiques Grand Junction Model By Paul Hsieh, MD @ 12:05 AM
Dr. James Schroeder has written a great OpEd for the July 10, 2009 Grand Junction Free Press criticizing the "Grand Junction Model" for health care which is now being touted as the method to achieve government health care reform.
...First, a large study done at Dartmouth University looking at variations in Medicare spending was released in April 2008. More recently Dr. Atul Gawande, an Ivy League surgeon, wondered in the June 1 issue of The New Yorker magazine why McAllen, Texas, had one of the nation's highest levels of Medicare spending. Grand Junction's name came up in that article as one of the lowest spending regions.
Now, President Obama's team is using the Dartmouth study to leverage advancement of the Democrat party's health care proposal.
...All the data showed is that some hospitals spent more than others. As such, this study could serve as a starting point for further research, not as a measure of how to model health care delivery for the nation as a whole. Now let me rephrase this in case you weren't paying attention. The death rate in this particular study was 100 percent. Yes, you read that right, every single patient analyzed in this study died! The only logical conclusion to be made is that Grand Junction is efficient at getting people to the point of death.
Hang on to your wallet, because the Dartmouth Atlas will now be touted as showing that some regions (Grand Junction being the shining example) are “more efficient” at delivering health care while saving money! This in turn will serve as the anvil upon which health care spending throughout the country will be hammered into line by a federally controlled health care system. In fact, the Dartmouth study reveals absolutely nothing about efficiency. Determining "efficiency" will require looking at end points other than death, and will include individual interpretations of value, quality and lifestyle. But those things are much more difficult to measure, so we are about to be treated to an example of using data wrongly to support a wrong-headed argument.
...The current administration advocates a system that will take those difficult value judgments out of your hands and put them in the hands of a nice, caring, compassionate bureaucrat. If one could practice medicine by a cookbook approach, we would not need more family physicians, we would need fewer, because a simple computer program could do the job. But it just is not that simple.
Government-run health care can always save money by denying care and taking decision-making out of the hands of doctors and patients and shifting it onto the bureaucrats.
It's "efficient", but deadly.
Is that what Americans want?
(I do have a couple of minor disagreements with Dr. Schroeder's analysis, which are also nicely covered by Ari Armstrong. But overall, I agree with his major points.)
Schroeder on the Dartmouth Atlas By Paul Hsieh, MD @ 6:05 PM
Pediatric cardiologist Jim Schroeder has been active responding to state and national level attention being paid to health care in Grand Junction, CO.
In particular, he has responded to some recent articles and opinion pieces in the Grand Junction news:
Here is Dr. Schroeder's analysis, reproduced in full (with his permission):
Grand Junction in the Spotlight
It has been an unusually cold spring in Grand Junction, but hold onto your hats folks (not to mention your wallets) because it is about to snow in July.
Lil Ol' Grand Junction has popped up on the national scene in the current healthcare discussion. As a result, President Obama has been invited to visit Grand Junction as a shining example of how health care delivery should be done on a national scale and breathless local TV news reporters and members of the medical community are gushing. But in the excitement of being noticed by Washington some inconvenient facts are being ignored and other facts are being manipulated. Before we get too blinded by the spotlight of national attention that is about to hit, perhaps we should take a deep breath and regain a little perspective.
Why did Grand Junction's name pop to the surface? Here is the sequence of events. First, a large multi-year academic study was done at Dartmouth University (one of the lesser Ivy League schools) designed to look at regional variations in Medicare spending on health care. These results came out in April 2008. More recently Dr. Atul Gawande, an Ivy League surgeon, wrote an opinion piece or essay in the June 1 issue of The New Yorker magazine purportedly investigating why McAllen, TX has one of the nation’s highest levels of Medicare spending. Grand Junction’s name popped up in that article (alongside the Mayo Clinics) as one of the lowest spending regions. Next, this information came to the attention of one Barack Obama (an Ivy League graduate) who apparently is now using the Dartmouth study as a fulcrum to try to leverage advancement of the Democrat party’s health care proposal. Let me elaborate:
1. The Dartmouth Atlas: This study contains some intriguing data but is also being misrepresented in some ways. To briefly recap, the Dartmouth Atlas collected and analyzed data concerning the amount of Medicare dollars expended during the last two years of an individual’s life. They did this by the simple expedient of starting at the time of each person’s death and looking backward at Medicare records over a two year period. Patient expenditures were assigned to the primary hospital used during that two-year look back period and also to the city of residence at the time of death. Patients who were enrolled in a managed care plan were not included in the analysis. The data showed a wide range of variation between individual hospitals, cities and regions in the amount of dollars spent by Medicare in the last two years of a person’s life. For example, for inpatient hospital costs the values ranged from $13,706 (Dubuque, IA) to $51,917 (Manhattan) per deceased person. Grand Junction came in at $14,739 and was the lowest among 7 regions in Colorado while McAllen, TX came in at $33,729. What the data did not provide was an answer for why these differences exist. The data also did not show whether these differences in spending had anything whatsoever to do with the quality of the health care provided or any outcome other than death. The data did not indicate one way or the other whether the only outcome included in the study (death) happened earlier or later in hospitals that spent a lot or spent a little. All the data showed is that some hospitals spent more Medicare money than others. As such, this study should serve as a starting point for further research, not as a measure of how to model health care delivery for the nation as a whole.
Here's where you need to hang on to your wallet, because what is about to happen is that the Dartmouth Atlas will be touted as showing that some regions (Grand Junction will be held out as the shining example) are "more efficient" at delivering healthcare while saving money! This in turn will serve as the anvil upon which health care spending throughout the country will be hammered into line by a federally controlled healthcare system. In fact, the Dartmouth study reveals absolutely nothing about efficiency. Before that discussion can even begin, there must be some agreement on what constitutes 'efficiency'. That will require looking at end points other than death, and will include individual interpretations of value, quality and lifestyle. But those things are much more difficult to measure, so we are about to be treated to an example of using the wrong data to support the wrong argument for the wrong purposes.
2. Grand Junction: There are some aspects of Grand Junction that are unique in respect to this discussion. Grand Junction is relatively isolated geographically, with substantial mountain ranges separating it from the two closest metropolitan areas (Denver and Salt Lake City). The economy of Grand Junction primarily consists of agriculture and energy exploration and production. There is not a large union presence or much heavy industry. Small businesses abound. There is one large hospital (St. Mary's Hospital) and one small niche hospital (Community Hospital). St. Mary's has a fairly wide range of services while Community Hospital is more limited (e.g. no obstetric or newborn services, etc). There is one large regional insurance company, Rocky Mountain HMO. Grand Junction has a disproportionately high number of family practice physicians compared to larger metropolitan areas and a smaller number of specialists and even fewer subspecialists.
These are some of the reasons the current local framework works for Grand Junction:
-geographical isolation (G.J. is an inland island) -fairly homogenous patient population -homogenous range of physicians (FP predominating) -good range of basic services, but limited range of specialty services -sicker (i.e. more expensive) patients often are sent to Denver or Salt Lake City -limited range of industry (i.e. the large corporate purchasers of health insurance) -lack of a strong labor union presence (i.e. strong voice in benefits/coverage of plans) -lack of competition for hospital services -lack of competition for specialty/subspecialty services -dominant local health insurance provider (HMO)
Those same reasons are exactly why the Grand Junction model will not serve well as a useful model for national health care. But that won’t stop some from trying to jam the ugly stepsister’s foot into Cinderella’s slipper (gratuitous fairy tale reference).
3. The Cost Conundrum -- What a Texas town can teach us about health care
By Dr. Atul Gawande Here is an excerpt from Dr. Gawande's article:
The Mayo Clinic is not an aberration. One of the lowest-cost markets in the country is Grand Junction, Colorado, a community of a hundred and twenty thousand that nonetheless has achieved some of Medicare's highest quality-of-care scores.
Michael Pramenko is a family physician and a local medical leader there. Unlike doctors at the Mayo Clinic, he told me, those in Grand Junction get piecework fees from insurers. But years ago the doctors agreed among themselves to a system that paid them a similar fee whether they saw Medicare, Medicaid, or private-insurance patients, so that there would be little incentive to cherry-pick patients. They also agreed, at the behest of the main health plan in town, an H.M.O., to meet regularly on small peer-review committees to go over their patient charts together. They focussed on rooting out problems like poor prevention practices, unnecessary back operations, and unusual hospital-complication rates. Problems went down. Quality went up. Then, in 2004, the doctors' group and the local H.M.O. jointly created a regional information network—a community-wide electronic-record system that shared office notes, test results, and hospital data for patients across the area. Again, problems went down. Quality went up. And costs ended up lower than just about anywhere else in the United States.
Grand Junction's medical community was not following anyone else's recipe. But, like Mayo, it created what Elliott Fisher, of Dartmouth, calls an accountable-care organization. The leading doctors and the hospital system adopted measures to blunt harmful financial incentives, and they took collective responsibility for improving the sum total of patient care.
Keep in mind when reading this excerpt:
-"Grand Junction... has achieved some of Medicare's highest quality-of-care scores"
The Dartmouth data does not assess "quality of care". If he is referring to some other measures of quality he does not specify the source.
-"Problems went down. Quality went up."
There is no citation or data to support this comment other than an interview with Dr. Pramenko.
-"Then, in 2004, the doctors' group and the local H.M.O. jointly created a regional information network—a community-wide electronic-record system that shared office notes, test results, and hospital data for patients across the area. Again, problems went down. Quality went up. And costs ended up lower than just about anywhere else in the United States."
Once again, there are no data linking the creation of the regional information network with lowering of costs, decreased problems or increased quality. In fact, the Dartmouth data was collected from the beginning of 2001 to the end of 2005. The majority of the Dartmouth data therefore preceded the existence of the network (founded in 2004). In addition, since managed care Medicare patients were not included in the Dartmouth analysis, attributing any supposed savings to the HMO is dubious at best.
Dr. Gawande goes on to conclude that the reason for high expenditures in McAllen, TX is overutilization of medical services. Unfortunately, there is no definition of what constitutes "over-" or "under- utilization other than the cited dollar expenditures. Carried to its ridiculous extreme that would mean spending zero dollars would equal the "most efficient" strategy.
4. Having personally practiced medicine both in South Texas (San Antonio, just a couple hundred miles north of McAllen) and in Grand Junction, I can offer some perspective on the discrepancies between the two regions.
I can tell you from first-hand experience that there are huge differences in the collective mindsets of the medical community of South Texas when compared to the medical community of Western Colorado. Whether the differences reflect inherent cultural differences of either the general population or the doctors, historical evolution of medical services in the respective areas, demographic pressures, or some other factors I cannot say. I would not, however, be going too far out on a limb to say that corruption is rampant in South Texas. The mindset I saw when I lived there was one of "bill as much as you can get away with and then bill some more". Medicaid fraud was an everyday occurrence if not a way of life and diagnostic testing was used indiscriminately as a revenue source.
The mindset in Grand Junction has more typically been one of primary care, prevention and less utilization of diagnostic testing and subspecialty services. While it is safe to say that McAllen "overutilizes" it could be equally valid to say that Grand Junction "underutilizes".
5. It is reasonable and probably important to wonder why there are local and regional variations in health care spending. For now however, the available data raise interesting points of speculation rather than providing any answers. One could even make the case that regional variation in spending is not inherently a bad thing. We seem to be continuing to experiment on various ways of delivering health care. What works for Grand Junction will probably not work for Los Angeles or McAllen, TX.
Almost certainly a "one size fits all" nationalized approach will be untenable. Dr. Gawande acknowledges this to an extent when he calls for rewarding doctors and hospitals that unite into "accountable-care organizations, in which doctors collaborate to increase prevention and the quality of care, while discouraging overtreatment, undertreatment, and sheer profiteering."
Health care is, like any other commodity, finite in its supply. When you get right down to it, the entire health care debate can be conceived of as wrestling with the question of how to distribute a finite number of dollars for the purchase of health care services for a diverse population of 300 million. The only way to do that is by allocating expenditures or resources, or in other words, the dreaded "R"-word... rationing. Like it or not, rationing is at the core of every single healthcare reform proposal under consideration. Every entity that has a hand in the pie is trying with all their might to hang onto their piece and maybe get a little bit of someone else’s while those who seek to control the system are trying to fairly divide the pie.
Free market advocates believe that individuals making decisions in their own rational self interest, using the fruits of their own labor will collectively make wise decisions that will result in an inherent balance or "fairness" of the system. Those who value a given product or service more will choose rationally to spend more of their own money to purchase that product or service. Those who don't value a given product or service can choose to buy a boat or ATV instead. On the other hand, advocates of nationalized healthcare (including the current Congress and Administration) believe that a centralized government agency or oversight committee can efficiently collect individual wealth from a segment of society, pool that money for the purchase of health care goods and services for "all" and micromanage the delivery of these multitudinous goods and services and allocate resources effectively and fairly from Washington, D.C.
The questions you should be asking are these: Who will be making the rationing decisions and will those decisions be in your best interest? How is quality defined and how is it measured? What outcomes are measured and how accurately can they be measured? Does the raw data actually support the claims that are being made? Who gets to decide how much money gets spent on your health care during the last two years of your life, or the last five years of your life or any other arbitrary length of time?
We can only hope that what is good about the local medical system does not get swallowed up by a voracious federal juggernaut or glossed over in a meaningless sound bite. Is Grand Junction really a shining example of how to run health care or are we just giddy that a national celebrity might come to visit? Is that bright light the spotlight of a grateful nation or the headlight of an onrushing federal healthcare train barreling down the tracks directly at us? Listen carefully and critically to what is said. Take time to educate yourself. Speak up among your family, friends, community leaders and legislative representatives and let them know where you stand. And finally, wear your mittens and a sweater, Grand Junction, for the snow job is about to begin.
James K. Schroeder, MD
Dr. Schroeder is a practicing Pediatric Cardiologist currently living and working in Grand Junction. He has previously practiced medicine in the military for 13 years and in San Antonio, TX for 8 years. He attended high school in the Palisade High School right here in the Grand Valley. He attended college at West Point and the University of Colorado and medical school at Tulane University in New Orleans. Dr. Schroeder cares deeply about the future of his profession and the future his grandchildren will inhabit.
Dr. Schroeder makes many excellent points.
My only additional comment is to note that when producers and consumers are allowed to exchange goods and services in a free market (which the current system is not), the result is not rationing. Instead, it's an allocation based on people acting according to their own values and priorities in a just fashion.
Someone who purchases health care from a willing provider has earned it.
If someone needs medical care but can't pay for it, then he should ask for voluntary charity from others. But he should not demand it as some sort of "right" owed to him by a provider -- that would be asking for the unearned.
In contrast, rationing is a system in which the government allocates some good service according to its assessment, independent of the wishes of those who produce it. This violates the rights of the producers and the other consumers who may wish to trade with the producer on other voluntary terms.
This is the gross injustice of rationing, and we've seen the end result in other countries such as Canada and Great Britain, where the government decides who gets what sorts of access to advanced technology, and when.
The Senate Finance Committee has approved Colorado House Bill 1293. The Denver Post claims that this bill would reduce your insurance premiums. Not so. They will increase.
The Post claims HB 1293 would "increase the number of those covered by government insurance and thereby reduce cost-shifting" from the uninsured and under-insured. Sure, this cost-shifting increases premiums costs. But the cost-shift from those with government insurance far exceeds that from the uninsured.
In Colorado, the cost-shift from the uninsured increases annual premiums by $85 per insured Colorado resident. For the data behind this, search on-line for "uninsured cost-shift scam." Compare this to Medicare and Medicaid: Bloomberg recently reported that "Medicare and Medicaid increase the annual cost of covering a family of four by $1,788." As if the taxes we must pay to fund Medicare and Medicaid weren't enough.
If politicians want more affordable insurance they should repeal prohibitions that make it so expensive. For example, HB 1256 would allow Coloradans to buy insurance available in other states. In four states average annual premiums for individual plans cost $500 less than in Colorado. For family plans the potential savings increases to $1,000 in five states, according to America's Health Insurance Plans.
Government-controlled health care in the U.S. is a disease masquerading as its own cure.
Single-payer health care has failed in every other country
Response to your story, "Dems' bill shoots for universal health care" from 2/5/2009 by Ed Sealover.
Single-payer health care has failed in every other country that has tried it. Canada controls health costs by forcing patients to wait months for MRI scans and cardiac surgeries that Americans can get in a few days.
Single-payer advocates mistakenly claim that health care is a "right".
Health care is a **need**, not a right. Rights are freedoms of action (such as the right to free speech), not automatic claims on goods and services that must be produced by another.
Instead of single-payer health care, America needs free-market reforms, such as allowing patients to purchase insurance across state lines and use health savings accounts for routine expenses. Insurers should be allowed to sell inexpensive, catastrophic-only policies to cover rare but expensive events.
Such reforms could reduce costs and make insurance available to millions who cannot currently afford it, while respecting individual rights.
One of the basic principles espoused by the AHA is "Health Coverage For All, Paid For By All" -- a very collectivist slogan reminiscent of the Marxist dictum, "To each according to his need, from each according to his ability."
State subsidies for those families who don't qualify for other government programs (such as Medicaid or SCHIP)
Mandates on employers to provide a "meaningful share" of employees health insurance premiums (or else pay a special fee to the government for the government plan)
Expansion of SCHIP and Medicaid government programs, "for the children"
Creating a National Health Insurance Exchange to serve as a clearinghouse where people could purchase government-approved plans
New restrictions on insurers so that they could not exclude applicants based on pre-existing conditions
The Obama plan has many similarities to the ill-fated Massachusetts plan, except for not imposing an individual insurance mandate on everyone. Massaschusetts imposes this mandate on all adults, whereas Obama's plan would only impose it on children. For more on the problems in Massachusetts, see some of our earlier posts.
We'll be hearing much more about both the AHA proposals and the Obama plan in the near future. For now, I just wanted to alert FIRM readers that these issues may be arising at both the state and national levels here in Colorado.
Keep government out of benefits arena Dr. Paul Hsieh, Sedalia
I'd like to thank the Rocky Mountain News for opposing Amendment 56, which would force most businesses to offer health insurance to their workers ("Let's make a deal/There's still time to pull some ballot measures," Sept. 3).
Businessmen create jobs through hard work and rational thought.
Consequently, they have the moral right to decide on what terms to offer these jobs to prospective employees, including specific wages and benefits.
Conversely, workers have the right to negotiate for any wages and benefits they desire, and the right to reject offers they don't like. But they have no right to demand a specific salary or benefit (such as health insurance) through government force.
To "solve" the problem of high insurance costs by foisting those costs onto businesses would be just as wrong as "solving" the problem of high gasoline prices by forcing businesses to pay their workers' gasoline expenses. The proper solution is not more government regulations but free-market reforms that address the actual underlying problems.
This piece is a shorter version of my longer OpEd on the same topic.
Fortunately, it looks like Amendment 56 will be removed from the 2008 ballot as part of a deal reached between Colorado labor unions and business groups.
Hsieh OpEd on Employer Insurance Mandate By Paul Hsieh, MD @ 12:01 PM
The September 19, 2008 edition of the Rocky Mountain News has printed my OpEd supporting free market health care reform and opposing Colorado Amendment 56 (which would require businesses with more than 20 employees to purchase health insurance for all its workers):
This fall, Colorado voters must decide whether to require all businesses with more than 20 employees to provide health insurance for their employees (Amendment 56). Although voters may be tempted to say "yes," this is an immoral and impractical solution to the problem of rising health insurance costs.
It is morally wrong because it violates the rights of employers and employees to negotiate to their mutual self-interest in a free market.
Businessmen create jobs through rational thought and hard work. Consequently, they have the moral right to decide on what terms to offer those jobs to prospective employees, including specific wages and benefits.
Similarly, workers have the right to negotiate for any specific wages and benefits they desire, and the right to reject job offers that don't meet their criteria. But they have no right to demand a specific salary or benefit from employers (such as health insurance) via government force.
Two motivations behind this proposed law are (1) the mistaken notion that health care should be a guaranteed "right," and (2) the desire to force businesses (rather than government) to pay for this supposed obligation. But health care is a need, not a right. A right is a freedom of action in a social context, such as the freedom of speech.
It is not an automatic claim on a good or service that must be produced by someone else. There is no such thing as a "right" to a car or an appendectomy. Any attempt by the government to guarantee a false "right" to health care can only be done by violating the actual rights of someone — in this case, business owners.
Forcing businesses to provide health insurance to employees will also cause serious economic harm to Colorado. Such a law would cause many businesses to fire workers, outsource jobs, or cancel plans to hire new workers. This will disproportionately harm unskilled workers and those at the lower end of the income scale — the very people the measure is intended to help.
According to Howard Roerig, owner of Seale & Associates, Inc. in Centennial, "This measure will have a chilling effect on all small businessmen. Although I don't have 20 employees at present, I would make certain never to hire that 20th person. The costs would be so high that I would be better off starting another firm in a different state, and letting it do business in Colorado as an out-of-state firm.
"I would have to find some means of skirting this measure or else close my doors."
Other states such as California have driven away many businesses and jobs due to high taxes and heavy regulations. Colorado must not repeat these mistakes.
To "solve" the problem of high insurance costs by foisting those costs onto businesses would be just as wrong as "solving" the problem of rising gasoline prices by forcing businesses to pay their workers' gasoline expenses.
Our current high health care costs have been caused by decades of government interference in the free market. Hence, the proper solution is not more government regulations, but instead free market reforms that addressed the problems caused by prior government controls.
Some examples of free market reforms include allowing Coloradans to purchase health insurance across state lines and eliminating mandatory insurance benefits. Patients should be allowed to purchase Health Savings Accounts (HSAs) for small routine expenses and insurers should be allowed to sell low-cost catastrophic-only policies to cover rare but expensive events. These measures could greatly reduce insurance prices and allow patients to purchase from the best offerings of all 50 states, thus making insurance available to thousands of Coloradans who want to purchase it but currently cannot afford it. Furthermore, the state legislature could adopt these reforms without permission from the federal government.
If Coloradans want to address the problem of high health insurance costs, they should reject the Amendment 56 and instead demand free market reforms. This is right for employers, right for employees, and right for Colorado.
Paul Hsieh, MD, of Sedalia is co-founder of Freedom and Individual Rights in Medicine (FIRM)
I'd like to thank Ari Armstrong for suggesting that I write about this issue and Howard Roerig for providing me with a fantastic quote that concretizes the economic issues at stake.
Gov. Bill Ritter touted his health-care reforms as the "building blocks" of a larger plan when he signed them into law ("Ritter signs 11 'building blocks' of health agenda," June 4). That larger plan is socialized medicine.
The principle underlying these new laws is Karl Marx's dictum, "From each according to his ability, to each according to his need." Colorado taxpayers (the able) are now forced to fund expanded Medicaid benefits for children of less wealthy parents (the needy). Colorado health insurance buyers (the able) are now forced to fund a hearing aid benefit for children (the needy).
Colorado does not need more creeping socialism. Children are the sole responsibility of the parents who chose to bear them, not society as a whole. If unable to provide for them, parents should rely on voluntary charity, not forced welfare. If Ritter wants real reform, let him begin with those free-market principles.
Waste, Fraud, and Abuse -- For the Children By Paul Hsieh, MD @ 12:05 AM
"For the children" is the mantra universally invoked to justify most expansions of government welfare programs. But for some reasons, the supporters of these programs don't talk as much about the associated waste, fraud, and abuse. Here's just one example from Colorado, as reported in the June 9, 2008 Rocky Mountain News:
Health program for kids assailed
...A report on the Children's Basic Health Plan found that 10 percent of patients were classified incorrectly - either as eligible when they weren't or as ineligible when they were entitled to services.
Hundreds of people were kept on the program after their eligibility expired - for up to two years in some cases.
...The report stunned lawmakers. "That's huge," House Minority Leader Mike May, R-Parker, said of the 10 percent error rate in qualifying participants.
If the wrong people are being enrolled, "then the whole program doesn't work," said May, who was appointed as a temporary member of the audit committee.
...The Children's Basic Health Plan is the Colorado agency that carries out the federal program called State Children's Health Insurance Program, or SCHIP.
...The auditors found 831 women who remained in the program after their eligibility should have expired. The cost associated with them is $104,000, the auditors said.
But it is another example of the problems that we've seen repeatedly in any implementation of the welfare state. It's another reason to oppose a massive expansion at the national level in the SCHIP program.
Hannum on Colorado Health Care Activists By Paul Hsieh, MD @ 12:05 AM
Single payer advocate Kristen Hannum of the group Health Care for All Colorado recently discussed a number of Colorado-based health care activists on her blog. Most of the people she discussed were her ideological allies, but she did mention Lin Zinser and myself as representatives of the opposing viewpoint. She also criticized our article, "Moral Health Care vs. 'Universal Health Care'", calling our viewpoint "mean-spirited but also extremist".
I submitted a response on the comments page of her blog post, which she did post. Here are some excerpts from what I wrote:
I recognize that we are on opposite sides of this issue, and I thank you for linking to the article written by Lin Zinser and myself. I would like to make a few comments in response.
First, neither Lin nor I are Libertarians. Nor are we conservatives (i.e., we are not supporters of the political "right"). However, we are staunch supporters of individual rights.
Second, because you have mentioned the ethical dimension, I want to highlight the fact that our opposition to "single payer" health care (or any kind of government-imposed "universal health care") is based primarily on moral grounds.
I've written a FAQ that covers this issue in more detail, which arose from a letter of mine which appeared in the New York Times a few weeks ago supporting a free market in health insurance, and the from the multiple questions and comments I've received in return.
If anyone wishes to read it, it can be found on our website at:
I cover the moral basis for a free market combined with voluntary charity, and the reasons that any system of "universal health care" is deeply immoral.
...Finally, on a personal note, I am sorry to read about your brother's death. During my years of practice, I have reviewed hundreds of CAT scans of patients with both diverticulitis and appendicitis. Based on what you have written, it looks like your husband's death may have been the result of a misdiagnosis and/or delayed diagnosis, rather than due to a lack of access to a physician.
If this was a misdiagnosis, then this is a separate issue unrelated to issue of "single-payer". The issue of misdiagnosis and/or delayed diagnosis is extremely important, but it will also arise in *any* medical system, regardless of the economics of the insurance system.
Unintended Consequences Strike Again By Paul Hsieh, MD @ 12:05 AM
The June 1, 2008 New York Times had an interesting article about a Centennial, Colorado woman who wanted to purchase an individual health insurance plan from Golden Rule Insurance Company, but was turned down. She was in perfect health except for the fact that she had given birth via Caesarean section surgery (which meant that she might need to have C-section surgeries for any future childbirths.)
What was especially interesting was the fact that she wanted to purchasing from them, and they would have liked to sell the insurance to her. But Colorado state law prohibited the insurance company from offering certain terms:
Golden Rule, which sells individual policies in 30 states, said it would insure a woman who had had a Caesarean only if it could exclude paying for another one for three years. But in Colorado, such exclusions are considered discriminatory and are forbidden, so Golden Rule simply rejects women who have had the surgery, unless they have been sterilized or meet the company’s age requirements.
As a result, Golden Rule chose not to accept this patient for insurance.
This is an example of the sort of unintended consequences that arise when the government violates individual rights. In the case, this is the right of patients and insurers to negotiate in a free market to their mutual advantage. The legislators who passed this law undoubtedly thought they were protecting women who had undergone previous C-section surgeries. But in reality, the heavy hand of government regulation merely limited those patients' choices and violated their rights to contract freely with willing insurers.
If this prospective customer had been willing to except a 3-year exclusion for C-section coverage, they could have worked out a mutually acceptable arrangement. But the state law doesn't allow them to even try! And even if this particular patient might have chosen to decline that condition, there may be other Colorado women who would have gladly accepted those terms but are now forbidden from doing so by state law. We may never know how many.
Once again, government interference with the free market harms patients and insurers alike.
My wife and I pay $132 per month total for high-deductible health insurance, hundreds of dollars less than we would pay for comprehensive insurance. Our goal is to never need to make an insurance claim. We pay for all of our routine medical care -- doctor visits, eye glasses, dental work, prescriptions -- out of pocket, and we like it that way.
Our medical expenses come out of our Health Savings Account (HSA), which means that it's all pre-tax money. Unfortunately for us, various enemies of HSAs have been trying to undermine them at the national level.
By paying less for high-deductible insurance, we've been able to pay off debts faster and prepare for a family, something that has been difficult given our high tax burdens.
If Colorado wants to keep and attract young working families, the legislature ought not further muck up health insurance by loading in a bunch of new expensive mandates, Nor should the legislature require such couples to further subsidize others through higher taxes and/or insurance premiums.
If the legislature wants to make health insurance more affordable for more people, it should repeal existing political controls that have driven up insurance costs and priced some people out of the market.
However, we should realize that the broader problem with health insurance is that, because of federal tax policy, most insurance is tied to one's job. Lose your job, lose your insurance. Because of the tax benefits of "paying" people with insurance coverage, such insurance is really pre-paid medical care that discourages economic provision and consumption of health care.
Our society has largely forgotten the proper purpose of insurance when it comes to health. Most people remain healthy into middle age, when risks for various diseases start to increase. Through insurance, we voluntarily pool our resources to pay for the care of the few who get unlucky. If federal policy had not driven health insurance off track, we'd buy insurance when we're young at a low rate and keep the same policy long-term, and we'd also pay for routine and expected expenses directly, which would encourage healthy competition.
All of the commonly cited problems with medicine have been caused by decades of political intervention in medicine. For details, see "Moral Health Care vs. 'Universal Health Care'," by Lin Zinser and Paul Hsieh, MD, at WeStandFirm.org.
Yet, rather than act to repeal the controls that are the cause of the problems, many of today's politicians want to impose still more controls. If they succeed, the result will be worse health care that costs even more.
Here in Colorado, the legislature has considered everything but repealing the controls that are the cause of the problems. In 2006, then-Governor Bill Owens signed into law Senate Bill 208 to create the Blue Ribbon Commission for Healthcare Reform. That commission rejected the only free-market proposal and recommended such measures as massively expanded taxes and forcing everybody to buy insurance. The Commission's recommendations basically went nowhere.
But apparently one failed commission deserves another, so State Senator Bob Hagedorn is currently pushing Bill 217. If the bill passes, later this year Governor Bill Ritter will appoint "a panel of expert advisors" to come up with a bunch of new political controls for the legislature to consider in the future.
Originally, the bill encouraged the "panel of experts" to assume that all Coloradans would be forced to purchase politician-approved health insurance. The amended bill lists that only as an option.
Forcing people to buy insurance would cause two basic problems. First, you can't force somebody to buy something they can't afford, so any such plan must accompany massive tax hikes and subsidies. Second, once politicians force you to buy something, special-interest groups will constantly fight to include their pet service as part of the forced package, whether you want it or not. The result will be continual pressure to expand the scope of the forced insurance and make it ever more costly.
Much of the bill describes the creation of politician-approved "value benefit plans" for health insurance that would be subject to a variety of restrictions and substantially subsidized through taxes.
Yet consumers and providers have the right to decide through voluntary exchange what plans constitute a value to them. We don't need a new bureaucratic commission; we need liberty.
Ari Armstrong, a guest writer for the Independence Institute, blogs at FreeColorado.com.
With Senate Bill 217, which has passed the Colorado Senate and awaits House action, state lawmakers who believe that higher taxes and more spending constitute health care reform have sunk to new depths of legislative trickery.
If SB217 passes, the basic laws that created the failing Massachusetts health care plan could take effect in Colorado in as little as 24 months. Sponsored by Sen. Bob Hagedorn, D-Aurora, and Rep. Anne McGihon, D-Denver, the bill creates a politically appointed panel to create a set of recommendations for rules governing Colorado health care. The rules prepare the way for the panel to recommend that every individual in Colorado purchase state-defined "credible" health insurance. State tax law would "enforce the requirement."
Because even legislators know they cannot force people who have no money to buy health insurance, the panel likely will move to create a subsidy program to "assist low-income individuals and families in paying the premium costs for health insurance."
Judging from the recommendations of the Colorado Blue Ribbon Commission on Health Care Reform, this is an expensive proposition.
The commission recommended that families of four making up to $84,800 be eligible for low-income subsidies that would increase state spending by an estimated $2.3 billion. In a blow to those who peddle individual mandates as a way for the insured to save money, it estimated the subsidies would save about $777 million in spending on the uninsured.
SB217 creates a Connector program, "health marts" "through which an individual eligible for the state subsidy may select" one of the state designed "Value Benefit Plans (VBP)." The health insurance offered through VBPs would be designed by a government committee.
People who would buy "Value Benefit Plans" insurance would have to pay with their premium dollars for some odd things, like "educational materials" that show people how to use the Internet to get health information.
The Hagedorn-McGihon bill envisions prohibiting these plans from helping people to save money on health insurance premiums by paying cash for routine preventive care. It seeks to mandate preventive care and an unspecified grab-bag of wellness programs. The plans also would "encourage" insurers to use a "pay-for-performance system for reimbursing health care providers" and "evidence-based medicine."
Pay-for-performance measures may not be safe for patients.
Experts at a 2001 American Society of Transplantation conference were so concerned about the effects of forced switching from brand name to generic immunosuppressive drugs that they called for patients to be taught to inform their physicians of any switch to or among generic alternatives.
Meanwhile, the pay-for-performance program at Blue Cross Blue Shield of Michigan paid physicians $100 to switch patients from brand name drugs to generics.
SB217 contemplates the Colorado panel finding "a dedicated source of revenue" to support the new programs. But it also says the new revenues may be spent on "the premium subsidy program or other new state costs," so this dedication is a smoke screen. In practice, the new revenues will fund whatever the Legislature fancies. If the governor agrees with the expert recommendations, and he will, SB217 would require that they be submitted to the Legislature on the "third legislative day" of the 2010 session. They then would pass through the Legislature like grass through a goose. People in favor of tax and spend health care reform know that the more voters know the less they like tax and spend reform. Speedy passage limits public debate.
Speedy passage reduces the possibility that people might find out that individual mandates are failing in Massachusetts, where about 20 percent of the uninsured already have been exempted because buying insurance costs them too much. They might be reminded that insurance is not health care, especially when Massachusetts controls costs by cutting payments to doctors, creating a shortage of doctors in the program and ridiculously long waits for care.
They might also be reminded that government officials routinely understate program costs. When campaigning for the Massachusetts plan, then-Gov. Mitt Romney said it would cost $125 million. After it passed in April 2006, his administration issued bonding documents estimating costs at $276 million. As of January 2008, Massachusetts Gov. Deval Patrick was requesting $869 million to cover estimated 2009 costs. (Seven times the original estimate!)
Like Gov. Romney on costs, Colorado politicians mislead the public by saying there will be no mandates this year. In February, Sen. Hagedorn reportedly told the Rocky Mountain News, "There's no mandates coming down this session, pure and simple."
Sen. Hagedorn must have changed his mind in the last two months. He undoubtedly knows his bill contains a program that will impose a health insurance mandate in 2010.
By hiding under an expert panel subject to gubernatorial approval two years from now, he gets to have his mandate and deny it, too.
Linda Gorman is director of the Health Care Policy Center for the Independence Institute, a free-market think tank in Golden. She co-authored the minority report of Colorado's 208 Commission on Health Care Reform.
New Blog From Brian Schwartz By Paul Hsieh, MD @ 12:01 AM
Brian Schwartz and the Independence Institute have a new blog on health care policy, concentrating on Colorado issues: Patient Power. It looks like it should be a good resource!
Politicians shouldn’t force grown-ups to buy insurance
In "Health-care reform for grown-ups" (April 6), the Rocky's editorial board says "it can live with" mandatory insurance proposed in Senate Bill 217 if "value benefit plans are indeed viable and available at modest costs." But real grown-ups can't "live with" politicians treating them like children.
Attempting to justify this nanny-state proposal, the editors perpetuate the fallacy that the "cost-shift from the uninsured" makes insurance so expensive: Such "uncompensated care totals $600 million ... according to the blue ribbon commission." Wrong.
In a January 26 Speakout printed here, Commission member Linda Gorman showed that the Commission's figure was much less, and that the maximum annual cost-shift was "about $85 per insured individual." How much will SB 217 cost taxpayers?
Maybe mothers can force their four-year-olds to eat their vegetables, but politicians shouldn't force grown-ups to buy insurance. As grown-ups, we have the individual right to make that choice ourselves.
In football, in order to forestall injury a player is penalized when he piles on to a player who is already down. In politics a government that has repeatedly injured it's citizens with it's past actions is not only not penalized for the harm it has already done, but is encouraged to pile on to it's citizens a little bit more.
Such is the situation we find ourselves in with our legislature about to pass a bill (Senate Bill 217) that will make it a crime for you to not buy health insurance.
Once again the government in addressing a problem which it is solely responsible for; the skyrocketing cost of health care due to its decades-long continuing takeover of the health care market, will make the situation worse by piling on ever more restrictions.
After over a century of evidence that the more you restrict people's free choices in any particular market, the more expensive and less available everything becomes in that market, our socialistic leaders STILL think that the next batch of restrictions is going to make it all wonderful.
It won't, and several years from now when this latest intrusion into our lives has made health care even more costly and less available than it is now, the same people who are ramming this bill through will be demanding ever more power to dictate what your health care choices will be and how much they will cost.
When this cycle will end is when you/we the people decide to go back to the principles of freedom that this country started with. Until then 'enjoy' the consequences of your government’s latest trampling on your rights and intrusion into your lives.
I disagree with The Post's editorial praising Senate Bill 217's "foundation for universal health care in Colorado." State Sen. Bob Hagedorn's bill will squash real reform. Real reform means upholding the rights of individual consumers and providers to freely contract for care under mutually agreeable terms. Real reform means that your money isn't taken away from you to subsidize someone else while you're also paying for your own family.
Good examples of real reform are Health Savings Accounts, eliminating legal barriers to obtaining insurance plans in other states, slashing mandates, and stopping the runaway legislative train of government-run programs.
In the words of Dr. Phil, "What were you thinking?"
Gina M. Liggett,Denver
Jeffrey McCoy wrote:
Your editorial offered support of state Senate Bill 217, a study that would move toward a universal health care plan by 2010. The ultimate goal would be to mandate "health insurance for citizens who now lack it, just as motorists are required to have automobile liability insurance."
However, there is a big difference between mandating health insurance and mandating automobile liability insurance. If one gets into a car accident and he is at fault, then he must pay the other driver for damages. Without car insurance, compensation may not be paid. On the other hand, when someone does not have health insurance and gets into an accident, no one other than that person is harmed.
People have limited resources and they must decide where they want those resources to go. People have different needs for health insurance, and if some rationally decide that they do not need health insurance, then they should be able to make that choice. The Senate Appropriations Committee should protect individual choice regarding health insurance and not approve Senate Bill 217.
Contrary to the April 6 Rocky Mountain News editorial ("Health care reform for grown-ups"), Sen. Bob Hagedorn's proposed mandatory health insurance is the wrong prescription for Colorado. Massachusetts has already imposed a similar system of mandatory insurance for over a year, and it is failing badly. Like Hagedorn's proposal, Massachusetts requires everyone to purchase health insurance, with government subsidies for low-income residents. But rather than creating a health care utopia, the result has been the exact opposite - skyrocketing costs, worsened access, and lower quality health care.
The Massachusetts system violates the rights of individuals to spend their own health-care dollars according to their best judgment. Instead, individuals are forced to choose from plans approved by government bureaucrats. Special interest groups have loaded these plans with costly required benefits that many people might not otherwise voluntarily purchase, such as in vitro fertilization and chiropractor services. Although Colorado politicians promise not to impose similar expensive mandates, how long do we realistically expect this to remain true?
Due to the skyrocketing costs, the Boston Globe reports, the government will have to "cut payments to doctors and hospitals, reduce choices for patients, and possibly increase how much patients have to pay." Massachusetts is also asking the federal government to make up the shortfall of "hundreds of millions of dollars."
Instead of another massive government program, we should adopt free market reforms, such as eliminating insurance benefit mandates and allowing Colorado residents to purchase health insurance across state lines. These genuine reforms could reduce insurance costs between 20 percent and 50 percent for thousands of Coloradans, without compromising access or quality. The free market is the only moral and practical solution to our current health care crisis.
Paul Hsieh, M.D., is a practicing physician in the south Denver metro area and a co-founder of the Colorado group Freedom and Individual Rights in Medicine (FIRM).
What good is having medical insurance if you cannot get medical care? Peddlers of "universal health care" - from Hillary, Obama, to 2nd Congressional Democratic candidate Jared Polis - don't get this.
"Universal health care" is false advertising for politically controlled medicine, with government as the "single payer" monopolistic insurer. But having coverage does not guarantee getting medical care.
Since patients prepay through taxes, medical care appears "free." Hence, they have strong incentive to over-consume and providers need not compete on price.
To contain costs, governments restrict your access to life-saving treatment. In countries with such "universal coverage," patients die waiting for treatment.
The Canadian Medical Association Journal reports that in one year, 71 Ontario patients died while waiting for coronary bypass surgery and over one hundred more became "medically unfit for surgery." The Canadian Broadcasting Corporation reports that "109 people had a heart attack or suffered heart failure while on the waiting list. Fifty of those patients died."
"Physicians across Canada are in an advanced stage of burnout due to work conditions" which "causes them to retire early . . . or simply leave," a former Canadian Medical Association president told the New York Times. He "attributed much of the problem to technological shortages and the powerlessness doctors feel when patients complain about long waits for treatment."
"Access to a waiting list is not access to health care," wrote Canadian Chief Justice McLachlin when striking down legislation banning private insurance in 2005. Last year, a New York Times headline read: "As Canada's Slow-Motion Public Health System Falters, Private Medical Care Is Surging."
And England? The BBC reports that "up to 500 heart patients die each year while they wait for potentially life-saving surgery." The Times claims that a British woman "will be denied free National Health Service treatment for breast cancer if she seeks to improve her chances by paying privately for an additional drug."
A Daily Telegraph headline reads: "Sufferers pull out teeth due to lack of dentists." Another article says that "doctors are calling for NHS treatment to be withheld from patients who are too old or who lead unhealthy lives."
Consider politically controlled health care in America: Medicaid and Medicare.
Doctors are five times more likely to refuse seeing new Medicaid patients than privately insured patients. Increasing reimbursement rates won’t help much; more than two-thirds of doctors reported being overwhelmed by Medicaid's billing requirements, paperwork, and delays in payment.
ABC News says that "Medicare rules bar cancer drugs for patients," including the privately insured.
"Single payer" advocates cite international comparisons of life expectancy to support their cause. But life expectancy depends on factors unrelated to health care, such as unintentional injury and homicide. Health economist Robert Ohsfeldt found that when accounting for these two factors, life expectancy in America is comparable to that of Canada and England.
What really matters is your chance of surviving a serious illness. The American Cancer Society claims that "U.S. patients have better survival rates than European patients for most types of cancer."
So if politically controlled medicine isn’t the solution, what is? Not a Massachusetts-style "individual mandate," which forces everyone to buy insurance. This is essentially single-payer in disguise. Insurance regulations severely limit competition, so insurance companies are effectively government contractors for politically defined insurance.
The Boston Globe reports that to contain costs, Massachusetts authorities will "probably cut payments to doctors and hospitals" and "reduce choices for patients." Sound familiar?
Instead, we must recognize how government policies have crippled free markets.
Because the tax code deeply discounts employer-provided insurance, you're essentially stuck with your employer's non-portable plans. Hence, insurance companies can afford to be stingy and deny you care; they know that losing you as a customer requires that you change jobs. With government as "single payer" it's even worse: To change insurance providers you must move to a different state or country.
Our current system also encourages thoughtless over-consumption and skyrocketing costs.
The tax code punishes paying for medical care out-of-pocket and rewards buying insurance. So "insurance" has become prepaid medicine, and patients over-consume like business travelers dining on their company's expense account.
Further, legislation mandating minimum benefits makes insurance unaffordable for many. Consider: Colorado law compels widowed wives to pay higher premiums for prostate screening, maternity, and marital therapy.
Some Colorado legislators recognize this injustice. Just as businesses incorporated in other states can operate in Colorado, Coloradans should be able to buy affordable policies from insurance companies that meet less damaging regulations of another state.
While "universal health care" may provide health insurance, it doesn't guarantee health care. The uninsured are not the problem, but the symptom of the real problem - government meddling in personal choices of how we care for ourselves and our families.
Brian Schwartz, an optical engineer in Boulder, is a guest author for the Independence Institute. His free-market proposal to the Blue Ribbon Commission is at WhoOwns You.org.
Colorado Springs Gazette Opposes Mandatory Insurance By Paul Hsieh, MD @ 12:01 AM
The April 13, 2008 Colorado Springs Gazette has published a good editorial taking a strong stand against mandatory health insurance. It is the second editorial on the page. (BTW, I also agree with their first editorial supporting gun rights on college campuses):
NO INSURANCE; BREAK THE LAW
It's the grand prize of politics. Fix health care and be a rock star. Unfortunately, some things can't be fixed at the Capitol. But that's a memo state politicians refuse to read.
Both parties in the Colorado General Assembly are gleefully pushing a Senate bill they've called a bipartisan blueprint for universal health insurance, setting a goal of health care for all by 2010. Shockingly, Republicans seem as overjoyed as Democrats regarding the most overreaching and frightening bill to pass through Denver in years.
The bill, a brainchild of Sen. Bob Hagedorn, D-Aurora, is patterned after the Massachusetts health care program, signed into law by former Gov. Mitt Romney, a Republican.
Most notably, the Hagedorn plan would make it a crime for anyone in Colorado to choose against purchasing health insurance. Those who don't buy insurance would be penalized on their taxes, and subjected to other nasty sanctions of the state. It's a bit like addressing the homeless problem with a mandate that every human buy a house, or else suffer financial punishment. Imagine if there were only so many houses to go around, and every living being was required to buy one. It's a supply and demand nightmare scenario, and the health care proposal isn't much different.
In an effort to make the bill sound something less than insane, legislators will direct the Department of Health Care Policy and Financing, along with the Division of Insurance, to develop a new bare-bones health insurance package that offers something less than comprehensive coverage. That's to make us believe the program won't over-burden the health care system.
Mandatory health insurance will be a disaster, just like the program in Massachusetts. The system of Romney & Co. has resulted in higher health care costs, lower quality health care, major rationing, and a looming exodus of doctors from Massachusetts. Patients sometimes wait months to see a doctor, because everyone's entitled to consume health care now. Some residents can't find doctors accepting new patients at all, even though they're forced to pay for insurance.
The problem with health care is one of supply and demand and controls that interfere. There's more demand than supply, and that's why the price goes up. Legislators, by mandating health care coverage, will only increase demand on a system that's already unable to keep up for a variety of reasons, most of them regulatory. Hagedorn knows his bill has problems, but he feels compelled to save the day.
"The alternative to this bill is to do nothing, and I don't find that acceptable," Hagedorn said, as quoted in the Denver Post.
Mr. Hagedorn, please do nothing. It's the best thing you can do. The problems with health care have resulted from too much interference from politicians, not too little. You can't fix the system, and you'll only make it worse.
Latest health reform will backfire By Mark Hillman
Samuel Johnson called second marriages "the triumph of hope over experience." The same might be said for the latest health-care reform bill at the state Capitol.
For more than 20 years, crusading politicians have promised to deliver better health care to more people for less money simply by saying "make it so." With rare exceptions, the resulting legislation exacerbates economic distortions, makes insurance impractically expensive, drives insurers out of the state, and creates worse problems than originally existed.
Senate Bill 217, which the Rocky Mountain News inexplicably endorsed on April 6 ("Health-care reform for grown-ups"), seems to be a desperate attempt to "do something" without a game plan. What it does best is to create case studies in irony, hubris and cognitive dissonance.
At times, the bill's sponsors sound frenetic in their urgency, as when they propose to declare in state law: "Colorado cannot wait to address the current problems related to the delivery of affordable health care!" (Conspicuously absent exclamation point added.) Other provisions of the bill do not convey the same urgency. For example, the governor is instructed to appoint "a panel of experts" - yes, another blue-ribbon commission - to help craft a reform plan that could lead to substantive legislation not this year, or next year, but in 2010.
Elsewhere, it appears that the bill's sponsors never recognized that many of their objectives are irreconcilable. In calling for health insurance companies to design "value benefit plans" to provide a low-cost insurance alternative, the bill says that the state "shall not specify benefits or other details" of those plans. Just two paragraphs later, however, the bill stipulates a dozen mandated benefits or other details that value benefit plans must include.
Essentially, insurers are prohibited from proposing anything that's remotely innovative. They are commanded not to "interfere with the existing small-group market" but are locked into the same rating criteria that has devastated that market for most of the last decade.
Colorado's small-group market is verging on a "death spiral" - the point at which it is so overpriced and overregulated that anyone who is healthy enough to obtain insurance elsewhere has fled, leaving a pool that is disproportionately sick, aging and expensive.
Since 1998 when 536,367 people were insured through employers of 50 or less, the small-group market has suffered a mass exodus, largely due to well-intended but economically unreasonable price-fixing schemes imposed by the legislature.
By 2005 the state's population had grown by 16 percent, but the small-group market withered by 33 percent, covering just 358,264 insured lives.
If insanity is "doing the same thing over and over but expecting different results," then legislators need to own up to their own psychosis. Lowering health-care costs isn't as simple as passing a law demanding more for less.
If it were, Colorado wouldn't have the seventh-highest insurance premiums in the nation.
Legislators should permanently loosen the rating handcuffs, forcing insurers to compete for business, and repeal the mandates that have driven costs through the roof. Absent the courage to do that, they could at least allow insurers to propose choices that are popular and less expensive in other states.
SB 217 does change the existing health-care market in one dramatic respect, by signaling to insurance companies that state government is ready to force its incorrigible citizens to buy health insurance, even if it's unaffordable.
The bill calls for "a requirement that all Coloradans obtain health insurance either individually or through their employer" and provides for enforcement "though the state tax laws."
Rather than allow insurers to offer new choices or allow consumers to obtain coverage across state lines where Colorado's draconian regulations aren't strangling the market, legislators prefer to penalize taxpayers for the audacity of refusing to buy insurance that costs too much.
Even California Democrats recently figured out that it's wrong to tell working families to buy something they cannot afford just because government says so, joining Republicans to kill a heavy-handed mandate proposed by Gov. Arnold Schwarzenegger.
Economist Thomas Sowell has said, "The first lesson of economics is scarcity: There is never enough of anything to satisfy all those who want it. The first lesson of politics is to disregard the first lesson of economics." Unfortunately, Colorado politicians seem determined to again disregard sound economics and stick consumers with the cost of their political promises.
Mark Hillman (markhillman. com) served as majority leader of the Colorado Senate.
Thank you, Senator Hillman! (His piece also appears on his website.)
Mandating health care coverage is a costly mistake
The March 28, 2008 article, "Health Coverage Gets New Push" quotes State Senator Bob Hagedorn as supporting a plan to force all Coloradans to purchase mandatory health insurance, because it would be "immoral" to "sit on our hands and do nothing."
Unfortunately, the solution proposed by Senator Hagedorn is also deeply immoral and impractical. The state of Massachusetts has already imposed a similar plan of mandatory health insurance on its residents for over a year now, and it is failing badly. Like Senator Hagedorn's proposal, the Massachusetts plan requires all residents to purchase health insurance, with state subsidies for lower income residents.
But rather than creating a utopia of high-quality affordable health care, the result has been the exact opposite — skyrocketing costs, worsened access, and lower quality health care.
Massachusetts' system of government-mandated health insurance is immoral because it violates the rights of individuals to spend their own health care dollars according to their best judgment for their own benefit. Instead, individuals are forced to choose from a limited set of plans approved by the government bureaucrats.
Predictably, the government-mandated plans have been a huge magnet for special interests seeking to have their own favorite benefit included as a state requirement. These state-mandated plans therefore include numerous benefits that many individuals might not otherwise freely choose to purchase, such as in vitro fertilization, chiropractor services, prostate cancer screening, and maternity benefits. Hence, middle-aged Massachusetts women are forced to pay for prostate cancer screening, even though they have no need for that service.
Because the state-mandated health insurance is so expensive, the government must also subsidize the costs for lower income residents, which merely shifts those costs onto the taxpayers. The state has also created a huge new bureaucracy called "The Connector" to enforce these insurance requirements on individuals and businesses.
Overall, the plan is projected to cost as much as three times as originally estimated. According to the Boston Globe, the Massachusetts state government is now asking the federal government to make up the shortfall of "hundreds of millions of dollars."
Nor has the Massachusetts plan improved access or quality. The Boston Globe also reported that due to the skyrocketing costs, the state government will have to "cut payments to doctors and hospitals, reduce choices for patients, and possibly increase how much patients have to pay."
With such poor reimbursements, physicians are increasingly reluctant to take on new patients. Lee Sampson, a 47-year-old unemployed medical transcriptionist had to call 50 doctor's offices before she could find someone who would take her on as a new patient.
The Massachusetts plan has also had a "catastrophic effect" on the Cambridge Health Alliance, which serves most of the poor and uninsured in the Boston area. The high costs have forced the Alliance to fire staff and reduce services in order to stay afloat — harming the very people the plan was supposedly intended to help.
Colorado should not duplicate the failed experiment in Massachusetts. Their system of mandatory health insurance violates the rights of individuals and providers to contract freely for medical services to their mutual benefit. Instead, the government decides how people can spend their own money, and for what.
The predictable result has been skyrocketing costs, worsened access to health care, and a huge new bureaucracy, just like under any system of socialized medicine. As a practicing physician, I can't think of a more immoral "solution."
Instead, we need free market reforms, such as eliminating insurance benefit mandates and allowing Colorado residents to purchase health insurance across state lines.
These genuine reforms could reduce costs up to 20-50%, making health insurance possible to thousands of Coloradans who otherwise could not afford it, without compromising access or quality. The free market is the only moral and practical solution to our current health care crisis.
Paul Hsieh, MD, of Sedalia is a practicing physician in the south Denver metro area and also a co-founder of the Colorado group Freedom and Individual Rights in Medicine (FIRM).
2 Upcoming Events - April 15 and 17 By Lin Zinser @ 6:01 AM
Radio Interview I will be interviewed on Tuesday evening, April 15, 2008, at 5:30 PM Mountain Time (7:30 Eastern Time) on a new Radio show from Boston Massachusetts, on blogtalkradio with host Stephanie Davis. She calls herself a Boston Patriot as she opposes government solutions to government created problems, such as the so-called health care crisis, and supports individual rights and a limited government as our founding fathers did.
Because this is blogtalkradio, you can listen on-line live and make calls to the show, or you can listen to the archived recording of the show after it is over. We will be talking about FIRM, how to make a difference, and about the Massachusetts failed plan.
Live Talk in Boulder Also, I will be speaking to the Boulder County Republican Women about moral health care reform on Thursday, April 17, 2008, with lunch and talk from 11:30 am to 1:00 pm at the Spice of Life Event Center, 5706 Arapahoe Avenue, Boulder, Co.
Visitors are welcome to attend. The cost is $15.25 for lunch. Or you can just attend my talk (no charge) which will probably begin shortly after 12 noon. For either option, please contact myungkurth@comcast.net by the end of the day Monday, April 14 and let her know that you are coming, and which option you are choosing.
A "moral document." This is what Colorado House Democrats called their budget ("State budget clears House,: March 27), which expands government-run children's health insurance. This moral grandstanding is typical of the anointed, who support expanding Medicaid and the State Children's Health Insurance Program (SCHIP) — and it’s nonsense. There's no compassion or virtue in spending other people's money taken by force.
If a thug forces you to donate to charity, does that make either you or the thug virtuous or compassionate? What if this charity unfairly competes with voluntary charities, fosters dependency of recipients, encourages people to stop buying private insurance, and is run by a government that makes insurance expensive in the first place? All of these apply to Medicaid and SCHIP, which are government-run charities.
Advocating for government-run charities doesn't make one compassionate, as there's no compassion in forcing others to comply with another's notion of virtue. Unlike voluntary charities, not "donating" to a government charity through taxes lands you in prison.
Compulsory donations to government charities are unfair to voluntary charities. Every dollar the state extorts from taxpayers for SCHIP or Medicaid is one less dollar for a voluntary charity.
Forced giving is also disrespectful and intolerant. By forcing us to fund causes others think are important, it thwarts our freedom of expression and ability to support causes we judge to be worthwhile.
Unlike government charities, voluntary charities have strong incentives to be effective. Since they compete with other charities for donations, they must convince potential donors that their cause is worthwhile. Government charities need not persuade.
We know the cost of not "donating": prison.
If each Colorado adult funded Medicaid and SCHIP equally, we’d each pay almost $1000 per year. If you had $1000 to donate to a medical charity, which would you choose? Would you choose SCHIP, or a voluntary charity like Rocky Mountain Youth Clinics, which provides primary care to infants, kids, and teens?
Might SCHIP or Medicaid deserve your donations? Downloading Cato Institute studies "Sinking SCHIP" and "Medicaid's Unseen Costs" could provide guidance. SCHIP covers non-needy families: more than half of eligible children already have private insurance. The National Bureau of Economic Research reports that "For every 100 children who are enrolled in public insurance, 60 children lose private insurance."
Both Medicaid and SCHIP ensnare recipients in a low-wage trap: aversion to seeking higher-paying jobs for fear of losing "benefits." This keeps people on their backs and dependent on government, instead of being independent and self-sufficient. As "entitlement" programs, they send adults the message that they are entitled to have children — even if they cannot afford to raise them.
Too bad you have no choice; it's your hard-earned income after all. But government could provide such choice — by allowing its programs to compete more fairly with voluntary charities. One method is a dollar-for-dollar tax credit for donations to non-government charities that assist families with the medical and insurance expenses.
Taxpayers who prefer Medicaid and SCHIP to non-government charities can continue to fund them. The threat of lost tax revenue would give Medicaid and SCHIP strong incentive to effectively and efficiently assist families in need and foster their independence.
Empowering taxpayers to choose allows for true compassion, which is absent when we are forced to give. Taxpayers could compare non-profits with tools like Charity Navigator and GuideStar.org. GuideStar envisions "an increasingly efficient nonprofit marketplace where donors seek out and compare charities, monitor their performances, and give with greater confidence; nonprofit organizations pursue more effective operating practices, embrace greater accountability, and enjoy lower fund-raising costs; and society benefits from a more efficient, generous and well-targeted allocation of resources to the nonprofit sector."
So drop the "you're a bad person for opposing government charity" rhetoric and rise to this challenge: If Medicaid and SCHIP are so good, why not let them compete fairly with other charities, and let individual taxpayers decide for themselves?
Brian T. Schwartz, Ph.D., submitted the free-market proposal to the Blue Ribbon Commission on Healthcare Reform.
(A version with additional references and hyperlinks can be found on Brian's website.)
