Friday, November 06, 2009

Public Option = Single Payer = Gov't. Monopoly

1. Among the things that people complain about under the present medical care system are the costs, insurance company bureaucrats' denials of reimbursements for some treatments and the free loaders at hospital emergency rooms whose costs have to be paid by others. Will a government-run medical system make these things better or worse? This very basic question seldom seems to get asked, much less answered.

If the government has some magic way of reducing costs — rather than shifting them around, including shifting them to the next generation — they have certainly not revealed that secret. The actual track record of government when it comes to costs — of anything — is more alarming than reassuring.

2. Ironically, it is politicians who have already made medical insurance so expensive that many people refuse to buy it. Insurance is designed to cover risk. But politicians have mandated that insurance cover things that are not risks and that neither the buyers nor the sellers of insurance want covered.

In various states, medical insurance must cover the costs of fertility treatments, annual checkups and other things that have nothing to do with risks. What many people most want is to be insured against the risk of having their life's savings wiped out by a catastrophic illness. But you cannot get insurance just for catastrophic illnesses when politicians keep piling on mandates that drive up the cost of the insurance. These are usually state mandates but the federal government is already promising more mandates on insurance companies — which means still higher costs and higher premiums.

All this makes a farce of the notion of a "public option" that will simply provide competition to keep private insurance companies honest. What politicians can and will do is continue to drive up the cost of private insurance until it is no longer viable. A "public option" is simply a path toward a "single payer" system, a euphemism for a government monopoly.

~Thomas Sowell's latest column on the "costs" of medical care.

17 Comments:

At 11/06/2009 9:53 AM, Blogger Colin said...

Broken link.

 
At 11/06/2009 9:54 AM, Blogger juandos said...

Over at the Volokh Conspiracy there seems to be a divergence of opinions regarding the constitutionality of the individual mandate to purchase health care insurance...

Debating the Constitutionality of an Individual Mandate

 
At 11/06/2009 10:05 AM, Blogger juandos said...

Hey Colin, try this The "Costs" of Medical Care: Part IV...

 
At 11/06/2009 10:20 AM, Blogger W.E. Heasley, CLU, LUTCF said...

The article quotes Sowell:

“If the government has some magic way of reducing costs — rather than shifting them around, including shifting them to the next generation — they have certainly not revealed that secret. The actual track record of government when it comes to costs — of anything — is more alarming than reassuring.”

Going against the conventional wisdom of Liberals/Progressives/Socialists, or what ever they are calling themselves this week, maybe the track record of BIG GOVERNMENT means smaller government with smaller government scope, a non-unionized government work force, and lowering taxes too boot might be a refreshing path.

Saw this bumper sticker yesterday: Ronald Reagan 2012.

 
At 11/06/2009 10:59 AM, Blogger juandos said...

Government-provided health care isn't a competitor; it's a monopoly product paid for by the taxpayer...

 
At 11/06/2009 12:13 PM, Anonymous Anonymous said...

I think we should defeat this plan because we need to have fewer people be able to buy insurance, which will cause medical deflation.
Right now, we are feeding the beast of high medical costs. If doctors and hospitals were forced to take chickens for uncompensated medical care, they would either cost shift or lower their fees.
We need a catastrophe in order to have change. We need to have things get worse, have more people not have insurance, and more doctors and hospitals not get paid. If people do not get healthcare and pay for it themselves, that's their tough luck.

 
At 11/06/2009 12:35 PM, Blogger juandos said...

"Right now, we are feeding the beast of high medical costs. If doctors and hospitals were forced to take chickens for uncompensated medical care, they would either cost shift or lower their fees"...

Hmmm, well if you think medical costs are to high, don't buy any medical services...

No one is holding a gun to your head and forcing you to partake...

"We need to have things get worse, have more people not have insurance, and more doctors and hospitals not get paid"...

You should quit whining... Its so unseemly...

Wouldn't be easier and cheaper if we had responsible people (both the medical provider and the medical recipient) acting like thinking adults?

Just asking...

 
At 11/06/2009 1:09 PM, Anonymous Anonymous said...

Private monopoly Bad...Public monopoly Good...

By the way...municipalities, counties, and the Federal government already provide medical care for low income people. It's not like we are throwing them out on the street.

We need two things:

Eliminate prior conditions.

And everyone gets some form of insurance.

 
At 11/06/2009 7:03 PM, Blogger juandos said...

The real cost of nanny state medical coverage will have some real costly suprises that Dr. Sowell has yet to address...

 
At 11/06/2009 8:23 PM, Blogger Stephanie said...

Interesting post, but simply not true. The public option isn't a new idea and it's actually been working for years already. And I'm not talking about Medicare. Check it out. http://cli.gs/23yYaM/

 
At 11/07/2009 12:01 AM, Anonymous Steve said...

I wrote Senator Brown here in Ohio about not voting for any Health Bill that increases the national debt. I received back a form letter where he spelled out how wonderful it is all going to be. My letter was a waist of time.

 
At 11/07/2009 3:21 AM, Blogger PeakTrader said...

Why government health care fails (from article):

"Suppose you couldn't raise prices, you couldn't control costs, and you were morally obligated to meet the needs of customers who were eager to sue if anything goes wrong. This aptly describes the economics of a doctor's practice today.

By occupation, I am a cardiologist and have been in practice for almost 30 years. For 17 years I helped build a large cardiology group practice and seven of those years I was its managing partner. Therefore, I am very familiar with the business of medical practice and the affect of government regulation. Politically, I long ago registered in the State of California as “None of the Above” because Independent is a political party in this state.

Most consumers consider healthcare a “right”. Somehow, Americans should have a right to excellence in health or better healthcare or easy access. But what most consumers really mean by a “right” is that healthcare should be “free”. That means someone else should pay for it. Some seniors feel that their Medicare payroll tax has already somehow invested in a “trust fund” and therefore their care should be free. Of course, the trust fund is a fiction, and the monies that working Americans pay into Medicare go to pay the expenses of current beneficiaries (my comment: looks like another Ponzi scheme, like Social Security).

Physicians provide services of a similar if not more important kind. However, they are not reimbursed for the time they spend. They are not reimbursed for being more skilled or more efficient or more effective. They are reimbursed by the type of procedure they perform. If a doctor is deemed by his customers to be better than another doctor, reimbursement is still the same...Both at good hospitals and bad hospitals, a fixed fee is paid for every admitting diagnosis.

If you come through the emergency room and are identified as having pneumonia and are admitted to an ICU only to die 6 hours later, the hospital gets $4300. If you are more fortunate and survive in the hospital to be released 16 days later, the hospital gets $4300. It is, therefore, easy to understand why hospitals have no hope of reaping any profit from sick patients under this Medicare system.

Physicians are paid only for the face to face time they spend with you. They are not paid for any preparation for that visit or any services that may come after you leave the office. With the endless forms required for documentation of your visit by Medicare, physicians spend a considerable amount of the visit time either typing into a computer or filling out a form regarding the visit. If they do not, and cannot document the level of service they provide, Medicare can audit them and accuse them of committing fraud...The regulatory compliance under HIPAA and the new privacy guidelines create enormous additional paperwork burdens which represents an unfunded mandate... I employ two wonderful nurse practitioners who help me manage my patients and provide services for them in a manner much better than I could ever hope to accomplish myself. However, unlike the paralegal in my attorney's office, these nurses cannot submit independent fees to Medicare.

As private physicians look ahead, they see nothing but more regulation. There are already 130,000 pages of federal regulation plus state laws, and this will only grow, probably exponentially. They see nothing but more risk with the criminalization of practice and the constant worry about whistleblowers. They see inevitably that there will be less reimbursement for their services. They see less job satisfaction, and they are running out of ways to adapt."

 
At 11/07/2009 4:35 PM, Blogger juandos said...

re: 'Why government health care fails (from article)"...

Hey PeakTrader, you have a link for that article?

 
At 11/07/2009 5:27 PM, Blogger PeakTrader said...

Yea Juandos, cut and paste: APPA Presentation - MEDICARE - THE REAL TRUTH in Google.

 
At 11/08/2009 4:09 AM, Blogger juandos said...

Thanks PeakTrader...

If the news is anything to go by then this bit just got worse: This information is, unfortunately, very complex because of decades of healthcare legislation which has made healthcare the most regulated industry in our country. Over 130,000 pages of federal regulation govern everything hospitals and doctors do. In addition to this, there are over 1500 state mandates regulating the health benefits products (aka health insurance) that we have available to us...

 
At 11/08/2009 11:00 AM, Blogger PeakTrader said...

Spending $2 for $1 of benefit or creating an opportunity at the expense of losing two opportunities somewhere else is not a good policy.

The best way to help the poor is provide more opportunities and better safety nets, rather than punish the rich.

The private sector creates opportunities, while the public sector tends to shift opportunities. Government can loan money to the poor (at low rates) rather than give money away.

A voucher system (customed made for individuals) can target how government loans are spent, e.g. for health care, housing, food, clothing, etc. (a cash system may not have the desired effect). When poor Americans start working (from greater opportunities in the private sector), part of their income can be garnished to pay back the loans.

You wouldn't spend $2 for something worth $1. What type of person would allow the government to spend $2 for something worth $1, or force your rich neighbor to squander his money?

More output per person helps the poor, and individuals tend to make better choices with their money than government.

 
At 11/08/2009 1:24 PM, Blogger juandos said...

"What type of person would allow the government to spend $2 for something worth $1, or force your rich neighbor to squander his money?"...

A very good question of course PeakTrader...

Could the answer to that question be, 'Pork Lovers', maybe?

 

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