Wednesday, June 17, 2009

Say No to Public Health Care Insurance

The president's plan for universal health care is another bad idea in a long line of bad ideas on this subject. If he, or anyone is congress, would like to actually help folks obtain health care insurance he would push for tort reform, interstate competitiveness, medical savings accounts, and dollar for dollar tax credits to incentivise working Americans to purchase health care insurance for themselves.

Some folks already have medical savings accounts, but it should be made available to everyone.
Interstate competitiveness may be another hard nut to crack because it would in large part remove the several states' power to regulate medical insurance.

I realize this would be a long shot in today's political environment as our illustrious representatives do not understand the term "tax cut". If you explain it to them (and there is no camera or microphone near by) they may let you know that you're talking crazy talk. Tax cuts indeed! Tax cuts to elected Democrats is like garlic to vampires.

The other issue, tort reform, isn't going to happen anytime soon either. Can you imagine two rooms full of lawyers who get to make law and give themselves pay raises suddenly deciding to cut or remove the the largest jackpot lawyers have ever found? Yeah, me either.

All of these issues would have to take on life as a real grass roots issue. Much like the Tea Parties around the country, or the grass roots effort that killed the lame version of so-called "immigration reform".

But, I cannot just pick on the president all of the time as on some points, he gets it right. In fact this is his forte. He will say that which is so true that it defies contradiction. Wonderful. But then he will go on to say something that is completely contradictory or simply wrong. He outlines, as much as he has been able to, his government health care plan in a letter to congress.

In his letter to congress concerning health care insurance he says,
"Soaring health care costs make our current course unsustainable. It is unsustainable for our families, whose spiraling premiums and out-of-pocket expenses are pushing them into bankruptcy and forcing them to go without the checkups and prescriptions they need. It is unsustainable for businesses, forcing more and more of them to choose between keeping their doors open or covering their workers. And the ever-increasing cost of Medicare and Medicaid are among the main drivers of enormous budget deficits that are threatening our economic future."
I agree 100%. Like a hammer he's hit the nail on the head.

But then he ruins it with this...
"I strongly believe that Americans should have the choice of a public health insurance option operating alongside private plans. This will give them a better range of choices, make the health care market more competitive, and keep insurance companies honest."
Public health care insurance is going to lower costs for everyone?

To borrow a phrase: "Here's yer sign."

But I wonder if Mr. Obama, or anyone in government, know why Health care and health care insurance has become so expensive? I believe they either do know why, and are not saying, or they really do not know why, in which case, they should be replaced with people who have a clue.

Health care in America has become prohibitively expensive because of our government. Through Medicare and Medicaid, government set prices on services and prescriptions, allow waste and fraud to run rampant, has become an unfair competitor to private insurance, and a lawyer led get-rich-quick scheme called "malpractice".

Sorry folks, but attributing cost savings to government would not only be unlikely, it would be impossible. I'm afraid our president's advisers have not learned the lessons of public health care insurance from the great state of Hawaii, the government plan to fill the gap for the uninsured in Hawaii. It lasted an entire seven (7) months before being dismantled. The reason? The people who already had insurance dropped their expensive private insurance in favor of the free insurance and almost bankrupted the state while destroying the private insurance companies. People are not stupid. If the government is going to use someone else's money to buy them insurance, it would only be in their best interests to get in on the deal. Of course, private insurance companies cannot force dollars out of the pockets of their customers, so they were left hanging. It won't work.

A quick glance at Medicare and Medicaid's history is a huge clue. In 1980 Medicare accounted for .7% of the country's health care spending. It has now grown to 19.7% of total health care spending. To ensure participation in this government program, Americans are forced into Medicare at age 65 or earlier if they receive Social Security Disability payments. All of this has reduced the number of people buying private insurance and a smaller customer base means higher prices. (just look at your utility bill. Save a lot and they raise the price.) Read more about Medicare here, here and here.

On Medicaid, the numbers are scary as well. (from Reuters, Report says Medicaid spending "unsustainable")
"In 1970, the report said, combined federal and state expenditures for Medicaid represented 0.4 percent of the economy, but this percentage grew to 0.9 percent in 1980, 1.2 percent in 1990, 2.0 percent in 2000 and 2.3 percent in 2007."
Another inflationary problem with universal health care insurance is the same problem that continues to run up the cost of Medicare and Medicaid: Cost control.

When I have to pay for something out of my pocket, I go for the best price I can get. If someone else is paying for it, then the price is not so much of a concern.

Malpractice Insurance. Doctors are charged huge premiums for malpractice insurance, which they must pass along to patients and their insurance companies. In order to hold back these costs, some governors have frozen insurance premiums in their states. Also, back in 2002 in the article, "High Insurance Premiums Jeopardize Rural OBs" (Rural Health News, Vol. 9, No. 1), they report...
"Citing data from a survey by Medical Liability Monitor, ACOG said that nationally, the median insurance premium for OB/GYNs increased 167 percent from 1982 to 1998. In 2000, it rose seven percent. In 2001, it went up another 12.5 percent. For 2002, the expected increase is 15 percent.

According to American Medical News, eight states saw two or more liability insurers raise rates by at least 30 percent in 2001. In more than 12 states, one or more insurers raised rates by 25 percent or more."
How can this not affect doctor, prescription and hospital fees?

Sheila Guilloton, of the Examiner, writes that...
"Malpractice insurance for OB/GYNs is reported to have one of the highest premium for medical malpractice, with some areas reporting premiums of $100,000 per year for OB/GYN coverage. Premiums in major metropolitan areas can be as much as $250,000 per year."
You can read more on The Tort Threat at the the Insurance Information Institute (I.I.I.)

On the Bill Bennett radio show, Morning In America, Senator Bill Frist said that when a doctor asked if a patient had insurance and the answer is "no", the doctor will prescribe generic, less expensive drugs. If the answer "yes", then the doctor can prescribe the more costly name brand drugs. Since a patient on Medicare or Medicaid is "insured", the fees and prescriptions will add to the taxpayers' burden.

If the federal government enacts public health care insurance, the same pattern will follow. People are not stupid. If they can get free (to them) health care insurance, they will abandon private insurers in favor of saving hundreds or even thousands of dollars each month. Wouldn't you?

So, there you have it. Medicare and Medicaid, along with malpractice insurance rates, are the prime reason that health care costs so much. The way to reduce these costs is not to add more government, as the president, his advisers and the US Congress believe. The answer is less government. Much less government.

Tax breaks will enable the working to afford their own insurance and that will act to keep medical expenses and insurance premiums lower. Tort reform will reduce the number of excuses insurance companies have to increase premiums while lowering doctor and hospital costs.

It needs to be mentioned that government is now intruding into areas of individual freedom that Americans are not accustomed to, such as deciding what to eat and how much exercise we need (or not), what kind of cars we need and what kind of energy usage is better for us. As government moves to further influence our lives, they will use the excuse of 'saving taxpayer dollars to reduce health care expenditures' by a reward and punishment system to be more healthy, just as I did when raising my children.

We are not children and do not need the impersonal government dictating lifestyles of Americans. Americans did just fine when there were no big government babysitting programs and we will do just fine again when they go away.

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