While there have been three different bills passed by Senate committees, and two other bills passed by the House, they share a fundamental feature: Increase the role of government bureaucracies and reduce the role of the individual in health care.
How about an alternative?
For several reasons ranging from election laws to political dynamics, we’re stuck with the Democratic and Republican parties as the two teams in national politics. All that is to say that Republicans aren’t necessarily the best option, but in this case, congressional Republicans are, among the political class, the ones offering the better options.
Their ideas have not gotten a serious consideration this political season, but let’s review them before we plunge over the cliff into the land of GovernmentCare.
Peter Ferrara offers up a list of some alternative methods of health reform: expand consumer choice in insurance; tighten up rules on lawsuits that drive up medical spending; use HSAs to let people know just how much they’re spending on health care, which could bring financial and medical benefits; expand high-risk pools for people who can’t get insurance otherwise; and allow small companies to pool employees together for insurance purposes.
Ferrara omits (I read this quickly; if it’s in there, point it out) any mention of equalizing tax treatment between employer-sponsored insurance and insurance you buy on your own. That’s puzzling, since what amounts to a tax on buying your own insurance keeps people in jobs they don’t like (”I need the benefits”) and is the single biggest cause of troubles afflicting health care.
These ideas are not the Sacred Writ of alternative health care proposals, but they’re a good place to start the discussion. Unfortunately, they’ve been dismissed, and we’re being sold the lie that you’re either for reform or you’re for people dying in the streets.
Senate Majority Leader Harry Reid (D-Nev.) has cobbled together his own Frankenstein’s Monster, a health “reform” bill of $849 billion. Somehow it actually cuts the federal deficit (fat chance, that).
Sen. Tom Harkin (D-Iowa) asked “What’s not to like about this bill?” Is that a rhetorical question, senator, or are you really so clueless as to be unaware of the various objections to compulsory insurance, introducing moral hazard into the insurance market, and additional taxes?
The legislation contains three provisions that in the end will be more meaningless than meaningful: states can opt out of a “public plan” (though not, presumably, paying for it); the public plan itself (the bad is bad enough as it is); and a ban on use of tax moneys to pay for abortion (which can be jettisoned in conference committee).
It’s an axiom of economics that if you want to reduce the consumption of something, you tax it. Reduce the number of people who smoke cigarettes? Enact a tax, and then raise it. Reduce alcohol consumption? Tax booze.
Reduce the number of people with health insurance? Tax …. Oh wait. I thought that the High Moral Purpose of the moment is to increase the number of people with health insurance.
In North Dakota, State Sen. Tracy Potter (D-Bismarck) suggests eliminating the state tax on health insurance premiums. Potter wants to make the cut only for policies sold by non-profit companies (read: BlueCross BlueShield), but it’s a start.
The Association of American Physicians and Surgeons (that is, the group of doctors that hasn’t sold out or cowered to the federal government) has a series of short articles about various claims made by advocates of turning health care over to government.
Actually, the problem is that we have too little pursuit of profit, not too much: “Profit maximization combined with competition is the only reliable way we know to keep costs down.”
In addition, it’s not as if health care is loaded with super-profitable companies: “Health plans are the 86th most profitable industry .. with a profit margin of 3.3%, about the same as home furnishing stores and heavy construction. Hospitals are 77th (with a margin of 3.6%). Brewers have a margin of 25.9%; major drug manufacturers, 16.5%; networking and communication devices, 16.3%; education and training services, 11.7%; and general entertainment, 6.8%.”
When federalism is vigorously practiced–that is, when states are not merely administrative units of the central government–it provides another “check” or “balance” that our political system is known for. State political leaders can tell the national ones, “Hey, what are you doing? Stop it!”
While federalism may “get in the way” when it comes to systematic reform, that can be a good thing, much like a fire wall can keep a disaster in one part of the building from burning down the rest of the house.
But when the central government passes out money like candy, resistance from the states to bad ideas is weakened.
I thought of all this when I read in the Washington Post that people in state capital cities are “giddy” about the money that Congress is doling out to shore up Medicaid programs. (Medicaid, which pays for health care for the poor and, these days, not-so-poor, is actually not one program but 54, for each state and various territories.)
Some states are more “generous” than other states when it comes to Medicaid. They extend benefits and offer Medicaid to more and more people when they’re swimming in tax receipts. But when the receipts slow, financial trouble comes to that state. Except if, as has happened three or four times during the history of Medicaid, Congress gives states more money. And that sounds great if you’re a state official, except it only postpones the day of reckoning. For while the cash infusion may be temporary, adding more people to Medicaid dependency creates a political dynamic that makes it harder to balance the state budget down the road. Given the track record of Medicaid, it’s also not terribly good for patient health.
An official with the Council of State Governments understands the danger for state officials: “[Federal bonus money buried in the health reform bill] would force states to absorb huge new Medicaid cost loads, and they want states to look past their immediate crisis and believe it’s going to be okay. It’s a sugarcoating to help them swallow a very bitter pill.”
Readers of a certain age will remember the slogan “Never trust anyone over 30.” When it comes to health care, we would all do well to remember a modified version of that expression: Never trust anyone in government to manage your health care.”
Two people of very different political views do take that to heart, and they’re worth listening to today.
David Boaz, libertarian, speaking in the mid-1990s to Republicans who were eager to use government to fix social ills: “One reason conservatives shouldn’t set up well-intentioned government programs is that they won’t always be in power to run them.”
Maggie Mahar, progressive, writing recently in the Washington Post: “I’m also wary that in four or eight years, someone else — someone less sympathetic to my views — may be in the White House. And conservatives could once again control Congress. So I am relieved that we don’t seem to be headed toward a single-payer system. We simply cannot count on ‘good government’ overseeing our health care.”
A big part of health “reform” envisioned by Congress is to load more and more people into Medicaid programs (which, by the way, sometimes pay doctors so low that people have trouble finding health care).
Though it’s impolite to say so, Medicaid is welfare. And Congress would expand welfare, to the point where one in five Americans would be on Medicaid.
The Heritage Foundation has a nifty graph that gives a state-by-state distribution. Click here.
Rep. Mike Rogers (R-Mich.) rips into the House Democrats’ plans for health reform, saying they punish the 85% of people who have insurance in the name of helping the 15% who don’t.
You can dispute his statistics, but his general point is valid.
Two researchers, one at the University of Chicago and the other at the Centers for Disease Control, have cranked out the numbers and have concluded that Americans are getting fatter because … fast food workers don’t make enough money. According to David O. Meltzer and Zhuo Chen, “Real minimum wage decreases can explain 10% of the change in BMI since 1970.”
