Thursday, December 27, 2007

Schroeder Vs. Pramenko on Government Medicine

Dr. Michael Pramenko recently wrote an OpEd in the December 10, 2007 Grand Junction Free Press expressing support for government-mandated "universal coverage".

In response, Dr. James Schroeder wrote the following rebuttal, which appeared in the December 26, 2007 issue:
Here's your prescription

By Dr. James Schroeder
Grand Junction CO, Colorado
December 26, 2007

Dr. Michael Pramenko expressed his health care views via a series of false premises in his Dec. 10 column “Play doctor, help find a cure for health care reform.” Well I don’t just play a doctor, I am one. Allow me to give your readers a healthier perspective by analyzing some of these fallacies individually.

* “Unfortunately, [taking government out of the equation] leaves a significant number of people without health care.”

There is a significant difference between health care coverage and health care delivery. Anyone (including my brother-in-law) can declare “health care coverage for all,” but if they can’t actually deliver services, it is an empty declaration. I know my brother-in-law doesn’t have the wherewithal, and I have my doubts about the government. Taking government out of the equation therefore would merely result in people not having governmental health insurance. We have yet to see in real life a government-run health care system without delays and rationing. The real question is whether more efficient use of health care dollars is achieved by government or by private entities. The other key variable is individual behaviors. How do we motivate individuals to use their primary care physician rather than the ER? Should the government try to modulate individual behavior in our best interests, or should we be responsible for making our own decisions? Dr. Pramenko seems to think that government is better suited to make those decisions by mandating individual purchase of insurance. I disagree.

* “The free market has chosen repeatedly to ignore the problem of the uninsured.”

We do not have a free-market health care system, so this premise is false from the get-go. The main causes for the expense of private insurance are unrelated to the free market. The tax code rules that originally allowed employers to provide health insurance as a tax-free benefit created a deeply entrenched connection between employment and insurance.

This led to employers controlling payroll costs by limiting the selection of plans while the employee was basically removed from the decision-making. It also meant that employees who changed jobs had a gap in coverage.

People who are temporarily between coverage account for about one-third of the total uninsured. Current government mandates force insurance companies to include services such as acupuncture, even if the policyholder has no need or desire for such coverage. Finally, individuals who buy health insurance must do so with post-tax dollars, effectively penalizing them. SOLUTION: We should reduce, not increase, government mandates. We should allow insurers to sell plans that are responsive to the needs of individuals and offer equivalent tax breaks for the individual insurance market. In other words, remove the government and employer from the market transaction between insurance provider and consumer. Wait a minute; that sounds like a free market!

* “We all pay for this unbridled use of the emergency room.”

The fallacy here is not that we all pay. The fallacy is that inappropriate use of the emergency room is because patients cannot access physician offices. The fact of the matter is that EMTALA legislation decrees that hospitals cannot deny emergency treatment on the basis of ability to pay. This has become distorted to mean that nobody can be turned away without fear of steep fines or penalties. Most Medicaid plans do not require a copayment for emergency room use. Thus, the current system actually makes it easier for patients to use the ER (convenient hours and no appointment needed!) for primary care. SOLUTION: We need to revamp EMTALA so that true medical screening can be applied and that patients without emergency conditions can be turned away. This should be a medical decision, not a financial one. Medicaid copayments should be reinstituted to serve as a deterrent for inappropriate ER use.

* “There is agreement on universal coverage, mandates on participation and … essential levels of coverage.”

“One thing is certain: More taxes will be needed ...”

These two comments are laughable. If there is already agreement and certainty in this discussion, the debate would be over. Far from any kind of consensus on health care reform there is ongoing active debate throughout Colorado. Many doctors feel, as I do, that government over-regulation has created a mess that cannot be fixed by expanding the role of government. More taxes are not the solution, but are inevitable if we continue to stumble down the path mapped out by the 208 Commission. The government’s role should be that of referee, not participant. Mandates are the problem, not the solution.

I have dedicated my career to the provision of high-quality medical care for children and truly believe that free market solutions are more sustainable in the long-run and more likely to benefit my grandchildren and yours. This belief is based on my own first-hand experiences in the health care system and my ongoing study of the issues.

Dr. Schroeder is in private practice in Grand Junction specializing in pediatric cardiology. He is a graduate of the University of Colorado and Tulane University School of Medicine. He completed pediatric cardiology training at Denver Children’s Hospital.

Thursday, December 20, 2007

Massachusetts Plan Squeezing Doctors

The December 14, 2007 Boston Globe reports that much ballyhooed Massachusetts universal health care plan is costing too much, so doctors and patients will have to pay the price. Items in bold are my emphasis:
Mass. panel approves changes to subsidized residents health plan
By Alice Dembner

Striving to hold down costs to taxpayers, a state panel yesterday approved a range of changes for next year for the rapidly growing subsidized health insurance program. The changes will probably cut payments to doctors and hospitals, reduce choices for patients, and possibly increase how much patients have to pay.

The program is the centerpiece of the state's landmark effort to insure nearly every resident, and there is widespread concern about long-term funding of the initiative because of growing healthcare costs.
The December 14, 2007 Wall Street Journal points out the natural implications:
Mass. To Cut Payments to Docs & Hospitals
Posted by Jacob Goldstein

Massachusetts’s universal health-care plan is turning out to be more expensive than predicted. Now the state is looking at cutting payments to docs and hospitals next year to make ends meet.

That fiscal reaction, which some critics of the plan warned about, sends a stark message to those of us in the other 49 states. Massachusetts has become something of a model for the national plans proposed by Hillary Clinton and John Edwards, among others.

The state requires everybody to buy health insurance. A subsidized health plan offered to the poor as part of the program has proved more popular than expected, and that’s helping to push costs 20% over what the state had budgeted. The tab could run $619 million for the current fiscal year, $147 million over budget, the Boston Globe reports.

Now the board that oversees the plans has approved cuts of 3% to 5% in reimbursements for to health-care providers caring for those in the subsidized plan. The article suggests the cuts will bring reimbursement in line with Medicaid.
The next logical step after price controls will be rationing. The Massachusetts plan is fundamentally flawed, because it does not permit individuals and insurers to seek their own best interests through voluntary contract. There's no reason for Colorado (or the rest of the country) to adopt this bad idea.

Tuesday, December 18, 2007

Pipes on Insurance Mandates

The December 17, 2007 edition of the Rocky Mountain News printed the following opinion piece by Sally Pipes of the Pacific Research Institute, discussing the folly of insurance mandates:
Remove barriers to affordable health insurance
Sally C. Pipes

Ever wonder why health insurance costs so much in Colorado? Well, maybe it has something to do with the fact that every insurance policy in the state must cover all kinds of services — including professional counseling — deemed unnecessary by many.

In fact, Colorado has 37 of these mandates. Should a resident want to buy a policy that doesn’t cover, say, chiropractor visits, sorry — the government has decided that everyone must have that coverage.

Recently, enthusiasm for universal health-care coverage has swept the nation, with governors in Massachusetts and California leading the way. Maine and Vermont are currently revising their own systems of expanded health-care coverage, and at least eight other states are pursuing similar reforms.

Certainly, the approximately 47 million uninsured in America is a significant problem, but the proposals under consideration do little to address the primary reason for the lack of coverage — very expensive insurance.

And why are those costs spiraling upward, seemingly without limit? One major reason is government meddling in the market for health insurance, particularly through the imposition of restrictive mandates and regulations.

The average state has 36 mandates on an individual health insurance policy. And with each mandate, the cost to the consumer goes up. These mandates often stand in the way of making health insurance more affordable in the first place.

Just as options on a new automobile add to the total cost of the car, so too do insurance mandates.

If affordability and accessibility are the problems behind the number of uninsured, then why haven’t state governments removed the mandates for those who want to buy a basic policy? It’s not just the government’s desire to micromanage — it’s interest-group politics.

Acupuncturists, for example, certainly provide an important pain-relief service to many individuals. But is it really necessary for everyone to have acupuncture coverage whether they want it or not? It would make far more sense to give individuals the freedom to purchase policies that suit their specific needs.

The current system guarantees that everyone pays the highest possible price.

We are covered for things we don’t use. Or if we do take advantage of these mandated benefits, we don’t realize the full cost of the benefit because someone else pays.

But we all indirectly absorb those costs thanks to higher premiums.

The conversation about health-care reform is long overdue, but unfortunately for most consumers, it’s headed in the wrong direction.

Without addressing the high costs of health care, efforts to achieve universal coverage by legislative fiat will fail. Just look at automobile insurance. Even though it is mandatory in all but three states, one in seven drivers on our roads remains uninsured. There’s a better way to expand health-are coverage — through greater purchasing freedom and fewer regulations.

Let’s hope Colorado learns from the heavy-handed approaches of other states and opts for a more effective approach — like ending the silly requirement that all insurance policies cover things like marriage therapy, which most people will never need.

Sally C. Pipes is president and CEO of the Pacific Research Institute. She is a resident of San Francisco.

Friday, December 14, 2007

Olson on Universal Health Care

The December 13, 2007 Rocky Mountain News printed the following LTE from David Olson critical of "universal health care":

Krugman's stance 'nonsense on stilts'
Dave Olson, Westminster
Thursday, December 13, 2007

In his column of Dec. 3, "Obama's sorry plan," The New York Times' Paul Krugman wrote in support of universal health insurance, "letting people opt out if they don't feel like buying insurance would make insurance substantially more expensive for everyone else."

First of all, I consider it immoral to force people to pay for health insurance that they do not want.

Second, it is nonsense on stilts. Adding more people into an insurance pool will simply add their cost to the total. Dividing the insurance cost among more people will not save money, when their costs have to be accounted for as well.

Third, health insurance is not health care. It doesn't even insure health care. Its only purpose is to insure that people in the medical profession get their fees paid. It should not be the responsibility of taxpayers to guarantee a doctor's standard of living.

Fourth, a better approach would be to stop using health insurance to pay for minor medical care. When it's used for things like getting a vaccination, treating a hang nail, or having a routine checkup, that drives the costs of both insurance and health care higher for everyone.

Tuesday, December 11, 2007

Brook and Lockitch: Free The Market

Modern Healthcare has published the following piece by Yaron Brook and Keith Lockitch of the Ayn Rand Institute. The original website requires registration, but the piece is mirrored on the ARI website:
Free the market; Government interference hampers healthcare reform

By Yaron Brook and Keith Lockitch
November 26, 2007

The Democratic presidential candidates are agitating to have the government do something about the spiraling cost of healthcare, especially the cost of health insurance, which is becoming prohibitively expensive for millions of Americans.

Insinuating that the free market has failed to produce affordable health insurance, they offer a variety of government "solutions," including proposals for universal coverage that range from systems of mixed public and private insurance plans to the outright socialism of a single-payer system.

But these proposals cannot and will not cure our ailing medical system because they misdiagnose the disease: It is not the free market that has caused the healthcare crisis, it is government interference in medicine.

The notion that America has a private, free-market medical system is a widespread misconception. More than 45% of total spending on healthcare in 2004 was government spending. Our semisocialist blend of Medicare, Medicaid and government-controlled, employer-sponsored health plans-with its onerous system of regulations and controls on medical providers-is the opposite of a free market.

Our system is built not on the premise that each individual is responsible for his own well-being and healthcare, but on the premise that healthcare is the collective responsibility of "society." Our system aims to relieve the individual of the "burden" of paying for his own healthcare by coercively imposing its costs on his neighbors. Far from being consistent with American individualism, this is the essence of collectivism.

In a system in which medical care seems free or is artificially inexpensive, with someone else paying for one's healthcare, medical costs spiral out of control because we are encouraged to demand medical services without having to consider their real price. For every dollar's worth of hospital care a patient consumes, that patient pays only about 3 cents out of pocket; the rest is paid by third-party coverage. And for the healthcare system as a whole, patients pay only about 14%.

Government-run healthcare, in particular, has fueled explosive cost increases. Prior to the inception of Medicare and Medicaid in 1965, healthcare spending was less than 6% of the gross domestic product. Today, it is 16%, one-sixth of the U.S. economy-with Medicare alone accounting for half the growth in healthcare expenditures. As spending explodes, the government cracks down by enacting coercive measures: price controls on medical services, cuts to medical benefits and a crushing burden of regulations on every aspect of the healthcare system.

These controls and regulations make it harder to offer medical services profitably, burying doctors, nurses and other providers in bureaucratic red tape and ultimately driving them out of the field. Drug companies are forced to cut back on the development of new drugs. Insurance companies are forced to restrict their policies. The shrinking supply of medical services, combined with an artificially increased demand, drives costs and insurance premiums still higher. This leads, in turn, to cries for still more government controls, which cause even more problems, and so on and so on, in a vicious cycle of destruction.

The Democratic candidates' proposals are just the latest iteration of this cycle-an attempt to solve the problems in our healthcare system by enacting the same kinds of destructive measures that caused the problems in the first place.

Although the proposals are couched in such positive-sounding euphemisms as "guarantee universal coverage," "ensure better preventive care," "modernize record-keeping," and "reduce waste and inefficiency"-there should be no doubt that what they would mean in practice is a massive expansion in government interference and further distortions of the free-market mechanisms that keep quality up and costs down.

Consider, for example, the goal of modernizing the healthcare system. It would be one thing for hospitals, doctors' offices, and insurance companies to modernize their procedures and record-keeping voluntarily, because they judged it an effective way to boost their productivity. It is a very different thing to attempt to impose "modernization" by government decree. All it can possibly mean in practice is a new flurry of regulations forcing medical providers to adopt government-approved technology, whether they have a use for it, overseen by a new government bureaucracy with all of its inevitably attendant inefficiency and waste. This would be like putting Amtrak in charge of modernizing train service.

Or consider the issue of universal coverage. A proper approach to healthcare reform would address the problem of skyrocketing insurance premiums by uprooting its fundamental cause: the shifting of responsibility for healthcare costs away from the consumers of medical services. A proper approach would remove the bizarre incentives that created our current employer-based system; lift the regulatory chains stifling the health insurance industry; and inaugurate a gradual phase-out of all government insurance programs, especially Medicare and Medicaid. Instead, the Democratic candidates propose to force businesses, insurance companies and taxpayers to simply shoulder the extra costs of herding every single American into our current collectivist system.

The solution to the healthcare crisis brought about by our hyper-regulated, collectivist medical system is not more regulation and more collectivism. We must remove government from medicine and put an end to the system that forces us to pay for other people's healthcare.

In freer industries, such as computers or shoes, there is no crisis of affordability or quality, because people don't demand free computers or shoes as a "right" to be enforced by government decree. We need to recognize that the same should apply to medicine; there is no right to healthcare-to be provided at others' expense. We must reject the proposals to expand collectivized healthcare-the Democrat proposals as well as those of the Republicans, who pay lip service to the free market but offer no fundamental changes to our current collectivized system.

What we need is a true free market in medicine, one in which the government's only role is to protect the individual rights of doctors, patients, hospitals and insurance companies to deal with one another voluntarily.

Yaron Brook is president and executive director of the Ayn Rand Institute, Irvine, Calif. Keith Lockitch is a resident fellow at the institute.

Copyright © 2007 Ayn Rand® Institute. All rights reserved.
(Note: FIRM is non-partisan and does not endorse any particular political party or candidate.)

Friday, December 7, 2007

Moral Health Care vs. "Universal Health Care"

Lin Zinser and I have written an article on health care history and policy that will be appearing in the Winter 2007-2008 issue of The Objective Standard entitled "Moral Health Care vs. 'Universal Health Care'".

We argue that the current crisis in American health care is the result of decades of government interference and violations of individual rights in health insurance and medicine. Hence the solution to the problem is not more government controls but instead to gradually and systematically transition to a rights-respecting, fully free market in those industries.

Normally, the articles are available to subscribers only, but the editor has made the full text of the article available for free online.

Wednesday, December 5, 2007

National Grocery Reform

Richard Ralston of Americans for Free Choice in Medicine has written this satirical OpEd on health care reform:
National Grocery Reform
By Richard E. Ralston
November 9, 2007

One of the great scandals of our age is the fact that America spends more on food than any other nation. Many political leaders are now calling for urgent reform to bring spending on food under control. Even worse, while the result of this uncontrolled spending includes the fact that many Americans are overweight, some Americans do not have enough to eat.

Leading liberal candidates now point to what they see as the heart of the problem: corporate "greed" in the form of grocery stores and restaurants operating on a for-profit basis. They promise to replace all private grocery stores with a national system of government commissaries, which will allegedly operate far more efficiently without the administrative overhead required to make a profit. As it will take some time to organize the national network of commissaries, initially groceries will be available only at offices of the Department of Motor Vehicles and U.S. Postal Service. These offices apparently have a proven track record of operational efficiency and excellent customer service, and will be a model for the development of a government commissary system.

Liberals would achieve further efficiencies, so they claim, by prohibiting all advertising of food and food products. This wasteful expense to provide consumers with unnecessary information has proven to be just a way for food stores and manufacturers to inflate prices and fatten business profits. Consumers will find shopping to be much easier if personal preference is eliminated in favor of whatever foods government makes available.

To achieve savings by eliminating the profits of food manufacturers, the U.S. Department of Agriculture will assume ownership of all of these firms, purchase all crops from farmers (until such time as agriculture can be reorganized into government operations) and manufacture an appropriate amount of food.

In spite of the efficiencies and cost reductions that government management will achieve, there is some concern that food might not be affordable for everyone. And food is surely a “right,” as it is necessary for human survival. Therefore all groceries made available in government commissaries will be free of charge. This will be financed by an increase of 15 percent in income taxes, except for those making over $80,000 a year, whose taxes will be increased by 75 percent. Because the supply of food is not unlimited, a fixed amount of ration coupons will be distributed to insure that each consumer can obtain an equal amount of food.

All private restaurants will be closed because of the need to equalize availability of food, and limited cafeterias will be operated in the government commissaries. Liberal political candidates point to the excellent example of school lunch programs as a model, and the proven results demonstrated by several generations of well-nourished, trim and fit students.

So far, conservative leaders are at a loss after hearing these proposals. Some of the more courageous conservatives are responding with proposals for Mandatory Food Purchasing. All citizens, including those who go to bed hungry every night, will be required to purchase membership in new Food Management Organizations. Private grocery stores and restaurants would still be permitted but under strict price controls to insure that all consumers can afford their FMO memberships. To further control costs, the purchase of certain cuts of meat and imported gourmet foods could require the FMO’s advance approval.

Across the political spectrum, there is a developing consensus that the only appropriate response to the fact that some consumers cannot afford groceries is to impose a single, regimented, government-controlled food system on all citizens. Advocates point to public education as an example of how forcing all but the children of the most wealthy citizens into the gray, sterile desert of a poorly performing public education system is the only way to insure that poor children receive any education at all.

Rumor has it that the clincher for those proposing socialized grocery plans was stated recently by one of the presidential candidates: "The ideal thing about these proposals is that if we can somehow get this to work for groceries, we can apply it to health care."

Richard E. Ralston is Executive Director of Americans for Free Choice in Medicine.

Tuesday, December 4, 2007

Universal Health Scare

Dr. Michael Hurd has written the following opinion piece, entitled "Universal Health Scare":
Universal Health Scare
by Michael J. Hurd (December 1, 2007)

An increasingly popular argument in favor of socialized medicine goes like this: "If universal health care works for the elderly under Medicare, then why not for the rest of us?" If that's true, then the Democratic nominee for President should definitely work this one into his or her acceptance speech, starting now.

But there's a tragic flaw in that argument. Universal care-socialized medicine-for the elderly does NOT "work," even on its own terms. Many services, such as my own (psychotherapy and mental health care), are only partially covered, if at all, under Medicare. It has to be this way; otherwise the program would be slated for bankruptcy even sooner than it already is. Why do you think Medicare "supplemental insurance" is commonplace, if not essential? Because "universal coverage" guaranteed by political funding is a myth. And if you think it's a myth now, wait until the baby boomers come of age and Medicare faces certain bankruptcy. And if "universal coverage for all" passes, then the price tag for the U.S.

Treasury goes into the billions or trillions of dollars. And you thought the Iraq war was expensive.

None of these dollars-and-cents concerns address the deeper problem with socialized medicine: What it does to the doctor. Although politicians may applaud themselves for "giving" everyone health insurance for free, doctors pay the biggest price by being at the mercy of the bureaucracy and injustice created by this monolithic system. Also, once the private insurance sector (or what's left of it) is completely out of business, which will be inevitable if not outright mandatory, doctors will have no choice but to follow government dictates. As it stands now, medical reimbursement rates for doctors are spiraling downward, even as tax rates go up. The Governor of California even has the audacity to try and make doctors foot some of the bill for socialized medicine in that state.

Doctors, under universal coverage, won't enjoy the freedom to charge patients fee-for-service, and patients likewise will not enjoy the freedom of paying their doctors fee-for-service to get better quality care. This is what "universal coverage" truly means, whether it's written into the legislation or not. And the reason is simple: Socialized medicine, no matter what you call it, makes the private practice of medicine obsolete, just as it has severely undercut the practice of medicine under Medicare.

Does anyone know an elderly person who is actually happy with his or her doctors, by and large, under Medicare? Are any of you who already are elderly happy with the treatment you receive under Medicare? As doctors get increasingly frustrated, and the lines and the waiting times get longer, and the paperwork piles higher and the visits get shorter, doctors will no longer work directly for the patient. Many will see no need to strive for excellence, because under these programs they get patients whether they're good doctors or not. It's the only game in town.

"Universal Care" will drive a permanent wedge between the patient and the doctor. Imagine if the government took control over YOUR chosen profession, career or job and dictated your every move, including exactly what you could earn in that job-whether you do it well or not.

Remember that Medicare is only a slice of socialized medicine. Calls for universal coverage are the real thing. Under what's being proposed now, we 're going to get more of the same-only a LOT more of it.

The person who claims that "universal care worked for the elderly, so why not the rest of us?" had better check out the facts. The Government pays about fifty percent of all medical expenses today. It pays more every year. People are less and less happy with their doctors and the whole financial aspect of medicine. Gee, do you think maybe government is creating more problems rather than solving them?

Friday, November 30, 2007

New Zealand Bans British Immigrant Because She's Too Fat

This story shows the inevitable result of a government-run medical system, where everyone has to pay for everyone else's health care. The government will start deciding what conditions are too "unhealthy", in order to save money. Here are some excerpts from the article:
British woman banned from entering New Zealand because she is too fat

A British woman planning to start a new life with her husband in New Zealand has been banned from entering the country - because she is too fat.

Rowan Trezise, 33, has been left behind in England while her husband Richie, 35, has already made the move down under leaving her desperately trying to lose weight.

When the couple first tried to gain entry to the country they were told that they were both overweight and were a potential burden on the health care system.

...Robyn Toomath, a spokesman for New Zealand's Fight the Obesity Epidemic and an endocrinologist said that obese people should not be victimised, but agreed with the restrictions.

"The immigration department can't afford to import people who are going to be a significant drain on our health resources.

"You can see the logic in assessing if there is a significant health cost associated with this individual and that would be a reason for them not coming in."
(Via JW.)

Wednesday, November 28, 2007

In the battle for universal health care, there are no winners

Pharmaceutical industry writer and blogger Stella Daily has written the following insightful analysis of the problems with health insurance as currently implemented:
In the battle for universal health care, there are no winners

As the 2008 presidential election approaches, the Democratic hopefuls are arguing about health care. Each candidate claims that his or her plan will lower costs and provide coverage to more Americans. Nowhere is the question asked: should universal health care be a goal at all?

Apparently, American politicians have learned nothing from the examples of Canada, the UK, and the like. Canada and the UK provide health care to all citizens -- or do they? In fact, while the national health services of both countries technically guarantee care to citizens, the reality is long waits for even the most basic services, a chronic shortage of healthcare providers, and technology that lags behind that of the US. This is no accident -- not that American politicians have figured that out.

Instead of asking how we can provide health insurance to each and every American -- since providing it to each and every Canadian and Briton clearly has not worked -- why not ask instead whether health insurance as we know it makes any sense at all?

Compare health insurance to other types of insurance with which you are familiar: fire, car, homeowner's, etc. What does insurance typically cover? When you buy car insurance, for example, you buy coverage for the catastrophic costs of highly unusual situations: the cost of replacing your car and paying medical bills should you be involved in a serious accident, for example. What you don't buy is "insurance" to pay for gasoline, oil changes, or even a part that won't wear out until the car has been driven for ten years. It wouldn't make sense to do so -- in order for the insurance company to remain in business, it would have to charge you the cost of those routine supplies and repairs, plus a premium for the salaries of its workers, the rent for its office building, and other costs, not to mention profit. So if car insurance covered gas and routine maintenance, its cost would go up astronomically. It would no longer be "insurance" for an unpredictable catastrophe, but a regular maintenance fee -- and it would cost more than covering regular, predictable expenses yourself.

Health care is no different. Health "insurance" as we know it covers not only truly catastrophic, rare events (such as a cancer diagnosis or a heart attack), but also a vast array of predictable, regular expenses like birth control pills, annual checkups, and psychological therapy sessions. Americans could save money by planning and paying for these expenses out of pocket, and saving health insurance only for the rare healthcare crisis.

I'll use myself as an example. I've been in the work force for seven years now. Throughout those seven years, my employer and I have paid, in total, about $400 per month, or $4,800 per year, for my health insurance. So, that's a total of $33,600 paid for my health insurance.

How much health care have I gotten for that amount? I'm a very healthy 29-year-old who doesn't engage in risky behavior: I'm in a monogamous relationship, I drink perhaps once a month, I don't smoke, and although heart disease runs in my family, I do my best to lower my risk by exercising five or six days a week. I see my gynecologist once a year (and I'd probably see him less often if prescription drug law didn't require me to come back every year to get my birth control pill prescription). Including the Pap smear he performs every year, that's about an estimated $300 per visit, or $2,100 in the last seven years. My birth control pills are partially covered under my insurance; that's another $500 per year, or $3,500 total. I visited the emergency room for a fainting spell that turned out to be dehydration earlier this year; the bills from that visit added up to about $5,000. I see a doctor at most once a year if I should happen to get a cold I can't shake. Let's call that $150 per visit, or $1,050 total. I'm usually prescribed penicillin at these visits, which my insurance does not cover because it costs less than my co-pay.

Add all of those medical bills up, and you get $11,650...which isn't even close to the $33,600 that my employers and I have put into the system. The rest is used by my insurance company to pay for other people's care -- other people who are probably engaged in more high-risk behaviors than I am. Why should I pay for that? And it is I who am paying, even though my employer shoulders most of the cost on paper -- that $4,800 per year could have gone to my salary. Given my druthers, I'd drop the plan I have in favor of catastrophic coverage to take over at, say, the $25,000 mark, the point at which my savings would be strained by a medical emergency. Such coverage would run me less than $100 per month -- so the total bill for all the care I've received to date, plus the cost of catastrophic coverage, would still fall short of what I've actually paid.

The obvious liberal response to my example is: But you're low risk. What about people who aren't so lucky?

First of all, it isn't entirely luck; a great deal of my good health is due to my good choices. If Americans weren't insulated from the cost of their lifestyle choices -- if smokers had to pay more for health insurance because of their higher risk for lung cancer and other health problems, if the obese had to pay more because they're more likely to require treatment for apnea or request a gastric bypass, if IV drug users had to pay more because they're at higher risk of infectious diseases -- then perhaps they would choose to modify their lifestyle to save some money. Furthermore, even for the high-risk individual, insuring for regular expenses still doesn't make sense. The insurance company has to stay in business; how will it do so if not by adding a premium to what those regular expenses normally cost? And, most importantly, a person's high risk for health problems does not constitute a claim on anybody else's time or money. Healthcare is a good, not a right; it has to be traded for like any other good, not extorted from the pockets of others. For those who cannot pay their own expenses, family, friends, and private charity may be inclined to benevolently help out; but even if they don't, the sick and indigent do not have a claim on the well and the wealthy.

This is why socialized medicine -- even socialized medicine dressed up in the guise of "private insurance" where the insurers have no right to select who gets covered or how much they pay -- can never work. It has not worked in Canada or the UK, and it will not work in America. Would that there were a presidential candidate who understood that.
(Disclaimer: FIRM is a nonpartisan organization and does not support any particular political candidate or party.)

Tuesday, November 27, 2007

Workers Would Lose Jobs Under Mandatory Insurance

Two Cornell researchers have shown that when the government forces employers to purchase health insurance for their employees, it will necessarily cause workers to lose their jobs:
Workers would lose jobs under mandatory health-insurance laws, report says

Laws that require employers to provide health insurance to employees will cause one in 10 of those workers to lose their jobs, according to a report on health-care reform.

The Employment Policies Institute, which sponsored research by two Cornell University economists, has released a report that’s sour on the concept of “pay or play” employer mandates, calling them “blunt instruments” to fund health insurance for the working poor.

Such laws, proposed in at least a dozen states, would require certain employers to provide health insurance to their employees or pay a fine.

Those laws may sound like a good idea to ensure low-wage workers get health insurance in jobs that don’t usually provide it, but Cornell researchers Richard Burkhauser and Kosali Simon discount that idea.

The sponsoring think tank agrees with their conclusions: “The cost of providing health insurance is so great that most businesses covered by ‘pay or play’ laws will be forced to cut back on hours and jobs just to stay afloat,” said Employment Policies Institute chief economist Jill Jenkins.
Although it's not the most fundamental reason for opposing government-mandated health insurance, it is a direct and predictable economic consequence of such bad policies, because the government is violating employers' rights by forcing employers to spend their money in ways they do not wish and are not economically viable.

Monday, November 26, 2007

Rick Wagner on Government Medicine

The November 15, 2007 Grand Junction Free Press printed the following OpEd by attorney Rick Wagner:
Buying health care votes

This next week Grand Junction will have the governor and his staff in town to discuss problems with the health care system. Much like the “listening tour” conducted by Mrs. Clinton in her state, these officials will undoubtedly keep listening until they hear the plan they want to institute. This plan will unquestionably seek to impose government-guided medical insurance or care in the State of Colorado.

It’s an unfortunate aspect of the Left in our country that the more a disaster a political or economic program is around the world, the more appealing it seems to become to their constituency.

Single-payer, government-provided or manipulated health care is turning into one of the great failures in the semi and outright socialist states in Europe. This outcome only seems to further excite those of a similar stripe in the United States to emulate the experiment. Experience shows that there are a few guaranteed outcomes from government manipulation of the health care system. Some of these results are long waiting periods followed by the use of outdated procedures and technology and the chilling grip of government directly on one’s health.

For example, in Great Britain, which has a National Health Service, the British newspaper The Telegraph reported that a 57-year-old man who needed an operation to fix the ankle he broke in three places, was refused the operation to rebuild the ankle due to the fact that he was a heavy smoker. Under the guidelines of the National Health Service, one can be denied treatment due to such behavior.

But what of the provision of free screening and testing, held up as a panacea to prevent disease in the United States? Well, according to the Telegraph yet again this year, the survival rate in Britain for cancer is among the lowest in Europe. England in fact is on par with Poland despite the fact that they spend over three times more on their health care system. Waiting and rationing can lead to all sorts of interesting results. For instance, as pointed out by the Cato Institute, surgeons in Canada report you are more likely to die while waiting for heart surgery than you are to die during the surgery.

What about the provision of drugs? Surely that would be better once, “Big Pharma‚” is out of the picture and the government can provide medications.

Well, according to Reuters in 2006, British arthritis patients were still being denied a new generation of medication that had been approved since 2002. This reportedly was due to caps on funding for medications based on the amount of money spent per patient per year or the number of patients who could receive medication.

And lastly, we can refer to an Associated Press article many have seen from October of this year that said due to a shortage of National Health Service dentists in England, Britons have taken to pulling out their own teeth or to using SuperGlue to stick crowns back on. It was reported that many dentists have abandoned Britain’s public-funded health case system, which has and left a growing number of Britons without access to care.

So what lies at the bottom of this continued desire to institute a failed system on the American public? The answer is two sides of the same coin, buying votes and increasing control. Trading cash for votes has always been a temptation for some seeking office. At least when politicians did it with currency, there was a degree of clarity to the transaction and often they would even use their own money. Here we have efforts to buy votes and they are not even using their own cash.

Picture if you will the degree of contentment you might feel if the same system that brings you to the department of motor vehicles and the postal service, decides whether you need that kidney transplant or the newest techniques in back surgery.

And since none of us are smart enough to know what’s good for us, it will be best, as in our British example, to deny health care for certain habits that are politically out of favor, like driving a Hummer.

Whether or not there would be any private health care available under some systems proposed is questionable. In Canada, if the Canadian health service delivers a medical service, it is illegal for a private company to deliver that service or a patient to try and buy it. For this reason we have Canadians with serious heart ailments going across the border into the United States to pay for health care.

Fixing the kinks that run up health care costs will not be accomplished by attaching a government funnel of money to the system in hopes that it will somehow lose weight. Putting the control for choosing health care and the amount that is paid for it back into the hand of the consumers is a more proven method to control costs. Many patients receive health care and are not even aware of what their insurance company pays for their visit.

A better choice might be to allow medical savings accounts that are tax-exempt to pay for medical procedures on the part of citizens and/or deduct medical expenses from their taxes.

But, wait. If liberals don’t have those taxes, how can they buy votes?

Rick Wagner practices law in Grand Junction.

Wednesday, November 21, 2007

Schwartz On Mandates and Single Payer

Brian Schwartz has just written the following OpEd on the problems with health care reform as envisioned by Colorado Governor Ritter and the 208 Commission:
Ritter's health care cure would prove more crippling to Coloradans

November 21, 2007
By Brian Schwartz

Colorado Governor Bill Ritter does not want does not want health care reforms that "throw more money at a problem without addressing the root causes of the crisis." Unfortunately, the state's 208 Commission does exactly that.

The Commission's favored proposals address the "crisis of the uninsured" by simplistically making it a crime not to have insurance. These involve two politically-controlled compulsory insurance schemes: a "single payer" system or an "individual mandate."

"Single payer" is a government-controlled monopoly where, as Canadian Chief Justice Beverly McLachlin wrote, "access to a waiting list is not access to health care." For a chilling picture of this, visit for video interviews with Canadian patients and reports on how, under "single payer," patients die waiting for care.

The individual mandate is essentially single-payer in disguise. Strict regulations on legal insurance plans severely limit competition, so insurance companies are effectively government contractors for politically-defined insurance.

A rationale for such compulsory insurance is to make the uninsured "responsible" by not allowing them to shift costs to the insured through higher insurance premiums. To address this, the Commission has proposed $1.1 billion in taxes for subsidized insurance and Medicaid expansion. This will cost $400 per privately-insured Colorado resident. Yet, the Commission's website shows the relevant cost shift from the uninsured to be around $200 million, or just $85 per privately-insured resident.

Compulsory insurance is unethical regardless of cost. Government should protect us from aggressors, but compulsory insurance is aggression. You'd face fines and ultimately prison for peacefully refusing to purchase politically-defined insurance.

Politicians love compulsory insurance because lobbyists will throw money at them in hopes of having their services covered. As P.J. O'Rourke observes, "When buying and selling are controlled by legislation, the first things to be bought and sold are legislators."

Indeed, politicians already succumb to special interests by forcing insurance plans to cover many benefits that you may not need. These mandates increase your premium costs by 21 to 54 percent. They reduce wages and are responsible for up to twenty-five percent of the uninsured.

Instead of expanding politically-controlled medicine, the Colorado Legislature should expand eligibility for "mandate-lite" policies and phase out mandated benefits. It should promote the Health Care Choice Act, which would allow you to buy insurance from companies in states with less damaging regulations.

Reform should also remedy the insurance-friendly tax code. Because the tax code exempts employer-provided health insurance, you're essentially stuck with your employer's high-cost, non-portable choices. Hence, insurance companies need not please you; they know that losing you as a customer requires changing jobs.

Tax-exempt insurance coddles insurers by encouraging you to waste money on more expensive coverage than you need, rather than keeping that money for yourself. Why save $100 on a more economic policy when after taxes you're only left with around $45? You might as well keep the costly insurance, though you probably won't utilize the high premiums and you could be saving.

This penalty on saving has resulted in our demanding prepaid medical care instead of real insurance. Since medical care appears almost free at the point of service, patients over-consume with little attention to cost, and providers need not compete on price. Providers need not satisfy you - as you are not a customer, your insurance company is. Yet, several studies have shown that patients with higher cost-sharing spend much less than those with prepaid plans - with negligible difference in health outcomes. They also seek more preventative care and motivate physicians to improve customer service.

To champion fairness and affordable quality medical care, legislators should support a tax code that treats out-of-pocket medical expenses and insurance equally, regardless of who pays insurance premiums. Phasing out the employer tax exemption and lowering taxes commensurately can achieve this.

Making all medical expenses and insurance tax-exempt may be more politically feasible. For example, allow anyone to open a tax-deductible Health Savings Account, regardless of one's insurance plan. Allowing us to purchase insurance with HSA deposits would free us from our employer's insurance, empower consumers, and encourage competition.

The 208 Commission foolishly supports Medicaid expansion. As shown in FAIR, my free-market proposal at, Medicaid fails to meet the Commission's criteria of increased access, personal responsibility, financial stability, and fairness. Instead of unfairly competing with insurance companies with Soviet-style government-controlled insurance, Medicaid could at least mimic Food Stamps by providing insurance vouchers.

This would be an improvement, but it's still unjust. For every dollar expropriated from you to fund Medicaid, private charities lose a potential donation. Tax credits for donations to medical charities would partially level the playing field. The threat of lost revenue would motivate Medicaid administrators to be effective, and taxpayers would have more freedom to fund charities they deem worthy.

Government controls cripple medical care. Effective reform requires phasing out destructive controls and programs, not creating more of them. Paraphrasing Colorado activist Robert LeFevre, government-controlled medicine is a "disease masquerading as its own cure."

Brian T. Schwartz is an optical engineer and freelance policy analyst in Boulder. This is a revised and expanded version of an article published in the Rocky Mountain News. His website is

Tuesday, November 20, 2007

Crunch Time In Massachusetts

The Massachusetts health plan, which relies heavily on harsh mandates on individuals to purchase insurance and employers to offer such insurance, is running into more financial trouble.

Because the state requires that the mandatory insurance coverage include numerous items that patients don't want (and would therefore not be viable in a free market), these policies are unnecessarily expensive. Then, in order to make the mandates politically palatable to the poor, the state is subsidizing their costs. So this system does nothing to alleviate the "cost-shifting" from the paying patients to the non-paying patients, it merely channels it through the state government. As a result, the November 18, 2007 Boston Globe reports that it will cost the state millions of dollars:
Success could put health plan in the red

Enrollment in the state's new subsidized health plan is growing so quickly that the state could face a funding gap as large as $147 million by the end of the fiscal year, according to a state projection.

...But the state would have to find ways to pay the insurance bills for so many more people. Options include appropriating more money, using funds allocated to care for those without insurance, or cutting extra payments to certain hospitals that were included in the law mandating insurance.
Based on the experiences in other states and other countries, price controls and rationing are only a small step away.

Furthermore, the Massachusetts plan depends on the ordinary, healthy people being willing to subsidize the system by purchasing plans that they neither need nor want. And those ordinary citizens are refusing to do so, according to the November 9, 2007 Boston Business Journal:
Thousands balk at health law sign-up mandate

With just seven weeks left until 2008, tens of thousands of Massachusetts residents -- up to 100,000 or more by some estimates -- have yet to sign up for insurance plans created as part of the state's historic health care reform law.

This has left insurers falling far short of expectations for signing up new customers, as countless people -- intentionally or otherwise -- come perilously close to risking fines and escalating penalties if they don't obtain insurance by the end of the year...
When a government violates the rights of individuals, insurers, and providers to contract amongst themselves free of government interference for their mutual benefit, these economic problems are the inevitable result.

Colorado should not adopt a plan based on health care insurance mandates that is already failing in Massachusetts.

Monday, November 19, 2007

Dr. James Schroeder on Medicaid

The November 18, 2007 Grand Junction Daily Sentinel printed the following LTE by Dr. James Schroeder:
Expanding Medicaid eligibility will mean fewer docs accept it

The dilemma faced by Dr. Glen Dean and his patients as outlined in the Nov. 11 article, “Tied up in red tape,” is nearly universal for those of us who provide medical care for children. Unfortunately, too many policymakers seem unwilling to accept some simple facts.

Rep. Buescher is quoted as saying, “If we expand eligibility without working on the reimbursement rates, any proposal is ineffective.” At the same time, he and his colleagues in the Legislature are considering several proposals that call for expanding Medicaid or the state Child Health Plan Plus, known as CHP+.

Apply some simple math. If you think the price tag for health-care reform is steep as currently projected, consider how much it costs when lawmakers think they can promise expanded coverage and increased physician reimbursement.

The truth of the matter is that expanding coverage will not ensure improved access. Rest assured that expanding Medicaid will result in a decrease in doctors who accept Medicaid.

Rather than expanding the current Medicaid and CHP+ system in Colorado, we should seriously look at fundamentally restructuring the nature of charity health care.

Instead of perpetuating Medicaid as a state-run charity with an iron-fisted lock on the charity market, we should encourage doctors to provide charity care outside of the Medicaid framework, allowing them to openly compete with Medicaid.

Eligibility for these private charity services could be determined on a need basis and incentives could be provided in the form of tax credits for providers who philosophically choose to provide specified services. In addition, individual donors who prefer to give money to a tangible local entity by choice rather than by coercion to an inefficient governmental bureaucracy could receive tax credits.

How many times must we hear that “the current system is broken,” so “let’s expand it”? That is purely nonsensical. I urge citizens to contact their state representatives today and tell them they oppose expanded government mismanagement of your health care.

Grand Junction

Wednesday, November 14, 2007

Hats For Everyone!

A Texas ER physician/blogger has reposted this classic article by Dianne Durante and Salvator Durante on the supposed "right" to health care:
Hats: A “right” for every American!

Dianne L. Durante and Salvator J. Durante

Let’s say we all agree that hats are worth having, or even a necessity, and that all Americans have a right to them. We pass a law stating that the government will pay for everyone’s hats, through taxpayer dollars.

What happens? First of all, hat sales skyrocket. I’m not particularly fond of hats, but if I can get them for free or below cost, why not?

Lesson One: there is no limit to demand, if those who get the product or use it, are not paying directly, or in some way they can see. This is unavoidable. The freeloaders will try to get all they can, and most of the rest of us will want something to show for our tax dollars.

If such a law passed, most hatmakers would be delirious with joy. Everyone wants hats! They expand their shops and produce as many hats as they can.

What happens next? The average price of hats shoots through the roof... Why?

There are two reasons. First, of the hats now being sold, the more expensive ones — the ones only a few people could afford before — will now be in much greater demand, since the individual hat-buyer no longer has to pay from his own limited resources. If the latest style is a platinum-plated beret, anyone who wants one will now get it. The other reason for the rising prices is competition: specifically, lack of it. New products, such as the first camcorders or the first compact disc players, are usually expensive. Prices drop because more people want to make money from a product: they try to come up with cheaper and more efficient ways of producing it, so they can sell the product more cheaply and grab some of the market. Our unlimited government funding of hats has completely cut out the need for competition. Any hat maker can stay in the business, no matter how high his prices.

Lesson Two: prices will skyrocket if there’s no limit to how much people can spend on a product. If anyone who wants the product can buy it, price no object, there is absolutely no reason for the manufacturer to try to cut his prices, and no reason for the buyer to control how much he spends. The government, and only the government, can give people virtually unlimited amounts to spend on a product. In short, it is not the greed of the manufacturer or the consumer, but the mere fact of the government funding of hats that is making hat prices exorbitant.

Next step: the government, and hence the taxpayers, are faced with enormous hat bills. Mrs. Smith may have confined herself to one hat, but Mr. Jones wanted five, and Mrs. Imelda wanted 52 Paris originals. The government knows it can’t continually raise taxes to pay for hats. Assuming it wants to keep the hat program intact, it has two choices: restrict the number of hats any one person can buy, or restrict the price of hats. In political jargon, that means rationing or price controls.

From a politician’s point of view, stating limits on the price of hats is the obvious way to go. There are fewer hatmakers who vote than there are hat wearers, and it’s easy enough to paint the hatmakers as greedy exploiters of the hatless. So a new law is passed no hats may be sold for more than $15, even if the buyer is willing to use his own money. The immediate result will be that the best quality, most expensive hats become unavailable. No more Paris originals.

Lesson Three: You can’t make a silk purse out of a sow’s ear. Good materials and good workmanship cost money. Yes, competition among manufacturers in a free market will cut prices in the long run. However, legislating a lower price for a product is not a shortcut to cheapness. It merely makes those who were selling more expensive goods go bankrupt, before anyone has time to work on price reduction.

We could try some complicated and devious maneuvers to lessen the effect of price controls. For instance, we could slap a $5 tax on shoes and use the money for the hat program. Then we could have a maximum hat price of $15, but still pay the hatmakers $20 per hat. That would mean, of course, that some poorer people wouldn’t be able to afford shoes, and the government would end up subsidizing shoes, too. Even so, price controls on hats will have to be instituted in some form, because demand is so high.

Remember that it is government spending for hats that made the demand and the prices so high in the first place: nothing except removal of the government’s money will get the situation back under control. But let’s keep trying...

We’ve now legislated a maximum price for hats. Nevertheless, Mrs. Imelda has bought another 35 hats, and the rest of us are still trying to get our taxes’ worth of hats. Not surprisingly, the amount that taxpayers are shelling out for hats hasn’t significantly decreased, despite our price controls. The next step? Well, of course, restrict the number of hats each person can buy: ration them.

Now what happens? A lot of hatmakers go out of business. They can’t sell hats for more than the maximum price, and they can’t make up for the loss in income through selling more hats. Bureaucrats demand forms in triplicate and slap fines on them at every turn. The best hatmakers soon leave the field in disgust. We are now facing a decreasing supply of hats, if not an actual shortage, because there are far fewer manufacturers. But hats are a necessity, aren’t they?

Now, we will have to pass a law forcing hatmakers to remain in business whether they can make a profit or not. However, even a government order can’t make a business run for long at a deficit, whether it’s a hatmaker, a child’s lemonade stand, or a bank. The hatmakers will go out of business, one by one.

The government will have to step in and make hats. Given the quality of most government products, you can imagine what kind of hats we’ll get. And given the efficiency of most government manufacturing operations, we won’t be surprised if we’re told we can each have one hat, in our choice of four styles, every other year.

Lesson Four: What the government pays for, the government has to control. Government funding of hats led to government control of hat prices, hatmakers, and finally everyone who is even remotely connected to hats. The only cure would be to end government funding of hats.

What began as a seemingly praiseworthy law — to provide all Americans with hats — has ended up driving the hatmakers we know and trust out of business, and given us government-produced hats of considerably inferior quality and very limited numbers. This result is absolute, inevitable, and non-negotiable: none of the economic rules above can be avoided, and they can only be temporarily circumvented by allowing the government to interfere in yet more private business.

Comparing hats to medicine or to pharmaceuticals may seem even less appropriate than comparing apples to oranges, but the same economic principles apply.

For more information about government intervention in medicine, write to Objectivist Health Care Professionals Network, P.O. Box 4315, South Colby, WA 98384-0315.

Tuesday, November 13, 2007

Competition Or Slavery?

The Happy Hospitalist writes about competition (or the lack thereof) in the US medical system (emphasis mine):
The Price Of A Pen

Go to your neighborhood Walmart and walk straight to the pen isle. That's correct. The pen isle.

Now just stand there and look. Look at the number of companies that make pens. The types of pens. The sizes. The colors. The "bacteria free". The "check book proof".

The prices. Look at the various prices. A vast array. Pennies to dollars.

Every pen you could ever imagine



Something as simple as a pen has hundreds of variations. Cheap to expensive all priced to perfection? How do I know that it's priced to perfection?

Because they are on the wall. If you, the consumer didn't buy it, it wouldn't be on the shelf for very long. You do not have pen insurance. If you like it, you will buy it.

What the heck does all this mean to health care?

There is no competition in health care. Medicare sets the rate, all other third parties follow suit. Hospitals cloak their product prices in secrecy. You the consumer don't pay. You don't care. You're insurance picks it up. The status quo has flattened the system.

Where's the competition.

Where's the innovation? Everything in this world is getting cheaper (except gasoline and subsidized agriculture) and better with more variety. Health care is not getting cheaper. And I'm hard fetched to say its getting better (for the money being spent)

Where is the drive for innovation?

Where is the 100 different pens per say?

It's bottled in the Medicare highway. Price controls create artifical limits to productivity. Success is determined by somebody else, not yourself. You are the slave of someone else. There is no sky is the limit.

Competition forces innovation on the top line and bottom line. To survive, change must occur, and quickly, or you go bankrupt. That is the American way.

That is innovation.

Not universal health insurance. It will kill innovation. It will perpetuate a status quo and create one pen instead of a 100. I can assure you of that.

Monday, November 12, 2007

HSAs Gain Popularity In Colorado

The November 6, 2007 Rocky Mountain News reports that Health Savings Accounts (HSAs) are gaining popularity in Colorado:
Some 15 percent of Colorado employers offer, or plan to offer, a health-savings account - or HSA - for next year's health care plans, more than twice as many as last year, said the Mountain States Employers Council. Nationwide, about 20 percent of companies plan to offer HSAs, according to Hewitt Associates.

"This is a way of passing more of the cost to employees, but it also allows the employee to have more control over their destiny," said John Martie, president and general manager of Anthem Blue Cross Blue Shield in Colorado.

HSAs, introduced by federal legislation in 2004, are like a 401(k) for health care. They allow employees to save for medical expenses with pretax dollars, and they're portable. The excess rolls over year after year, and employees take it with them to a new job or if they retire.
Some good news about Colorado health care!

Thursday, November 8, 2007

Giuliani's numbers on prostate cancer

"My chance of surviving prostate cancer — and thank God I was cured of it — in the United States? Eighty-two percent," says Rudy Giuliani in a new radio ad. "My chances of surviving prostate cancer in England? Only 44%, under socialized medicine."

Rudy Giuliani has taken a lot of heat for saying that he would rather have American health care than British health care because he has a much better prognosis of living in America with prostate cancer than if he lived in England. He has been ridiculed for the statistics he used.

In Tuesday's (Nov. 6) Investors Business Daily Op-Ed, David Gratzer (an advisor to Mr. Giuliani) provided all the statistics and the sources necessary.

While we do not endorse Mr. Giuliani or any candidate, it is good to see that sometimes politicians can get their facts straight. And it is even better to see that these facts are being made public.

"You mean I can't pay my doc extra?"

The physician-blogger Happy Hospitalist describes the perverse economic incentives imposed by the government that are destroying primary care medicine. Here are some excerpts from his post about his wife's sister's medical options:
...But back to the original discussion. Should she go on the ranks of Medicaid while in school? I warned her that in this area, most docs will never see you. You will be bound to the ER for primary care services. I explained the economics of the situation. She offered to pay her doc more.

Ah, there in lies the problem. I explained quite clearly that Medicare/Medicaid does not allow "balanced billing". Even if the patient chooses to pay more, it is illegal for her to charge more. It is also illegal to charge a cash paying customer a fee less than Medicare pays, if that docs accepts Medicare. In other words, Medicare would want that smaller fee. So, they won't pay more and you can't charge less. How absurd.

She was surprised that it is illegal to pay the difference between what we charge and what insurance collects. Here is a potential Medicaid patient willing to pay her fair share, and the system won't allow it. Why? I have no idea why. Both patient and doctor win. Patient gets access, Doctor gets their fair fee.

She talked about using chiropractor services, about how they offered to "work with her" as an uninsured client. This is capitalism. This is how it should be. Right now, we can't "work with her". It's either in or out. If she's in the Medicaid system, nobody will see her. If she's out, we can't charge her less than the Medicare fee schedule or it's considered fraud. Even though the cash only model allows for lower costs because billing/collections/ resource utilization is lower.

This socialistic model is killing primary care.
By forbidding patients and doctors from contracting for medical services at a price agreeable to all parties, the government is violating individual rights and harming everyone. (Via KevinMD.)

Wednesday, November 7, 2007

Why your doctor won't email or video chat you

Dr. Jay Parkinson explains why many doctors won't use e-mail to communicate with their patients:
When I first went live with my practice on September 24th, 2007, I received plenty of criticism regarding patient privacy and security. Many people questioned my compliance with HIPAA, a federal law the vast majority of physicians and institutions in America have to abide by in order to protect patients’ private health information (PHI). PHI is defined as any situation where there is an identifying factor (such as name or SSN) associated with a diagnosis. For example, John Smith is telling me about his seasonal allergy symptoms via AIM. Under HIPAA, if I were IM’ing with a patient using an unsecure chat application, like AIM, I could face thousands of dollars in fines. If I revealed this health information with criminal intent, I could face up to $250,000 in fines and 10 years in prison.

If I signed contracts with insurance companies and/or Medicare and submitted online claims to these companies I would have to abide by HIPAA. My entire practice would be illegal. I could not email, IM, text, or video chat anyone using the ubiquitous most popular communication apps (like AIM, gmail, etc.) without breaking federal law. They are not encrypted and considered not secure. I would be fined out of existence and, if argued in court, I could even face years of jail time.

If any of you are wondering why your own doctor doesn’t communicate with you using email, IM, and other ways that simply make sense in today’s world, wonder no further. They break federal law with every email and IM since the vast majority of physicians have contracts with insurance companies or Medicare.

...Because I do not take health insurance, I am free from HIPAA regulations and therefore I can conveniently communicate with you in ways that simply and plainly just make sense in today’s world. People have criticized me, a solo physician who will likely have about 1,000 patients in my practice, about security and privacy (FYI...all of my patient medical records are encrypted, password protected twice on my laptop and backed up daily to a secure, encrypted remote server). Those who question me seem horribly concerned about my patients’ privacy. Meanwhile, those of you who do have health insurance with the major insurance companies, please beware. Your name, SSN, and medical information are stored along with hundreds of thousands, if not millions, of other people in enormous databases at your mega-insurance company. The people responsible for that CD they’re using to transport maybe 196,000 people’s PHI aren’t doing such a good job. I guarantee I won’t have to provide 12 months of free Equifax to you if you are my patient. Go with the big guys and kiss your privacy goodbye. I personally use Apple’s encryption technology called Firevault. According to Apple, it could take as long as 149 trillion years to crack my password using a computer that could attempt it every second.
(Via KevinMD.)

Tuesday, November 6, 2007

Canadians Would Act In Their Rational Self-Interest

Although Canadians pay lip service to the egalitarian ideals of their socialized medical system, when push comes to shove, many Canadians will quite naturally act in their self-interest in order to get the best medical care for themselves and their loved ones. Despite the official rationing and waiting lists, Canadians say they would be willing to do what it takes to "jump the queue". Here are some excerpts from a recent article in the 10/26/07 National Post:
Canadians willing to jump health-care queues: study

When push comes to shove, many people would seriously consider pulling strings to jump a health-care queue, suggests a survey of Toronto residents.

And 16% of the 101 people responding to the Toronto telephone survey said they had already contacted a friend in the medical system in an effort to get moved up a waiting list.

...About 29% said they would consider giving a gift or donation to get ahead and 36% agreed that patients should be allowed to pay extra to get quicker access.

...In one scenario, the respondents were asked if they would speak to a neighbour who is a secretary at an MRI clinic if it meant getting moved up a list instead of waiting three months. About 71% said they would likely or definitely take the step.

Another scenario asked the respondent if they would give their surgeon tickets to basketball and hockey games if it meant getting hip replacement surgery faster. Thirty per cent said they would likely or definitely do that.

A third scenario asked if the respondent was willing to pay a $20 "emergency fee" to see a dermatologist about an unattractive but apparently harmless rash instead of waiting three months. Just over half said they would.

And 56% said they would likely or definitely let a doctor who owes them a favour move them up a waiting list for cataract surgery.

...Ann Heester, clinical ethicist at the Ottawa Hospital, said she's not surprised by the results of the survey. ..."The fact that people would jump the queue is all about desperation," she said. "People makes decisions based on their own needs."
Canadians are rightly frustrated by a system in which the government forbids them from spending their own honestly-earned money on goods and services for a voluntarily agreed-upon price with medical service providers, for their mutual benefit. When government force is used to prevent people from pursuing their rational self-interest, it no surprise that the result is unnecessary suffering and death.

Monday, November 5, 2007

True But Misleading Health Care Statistics

The November 4, 2007 New York Times reports on three commonly cited "true but misleading statements about health care that politicians and pundits love to use to frighten the public":
STATEMENT 1) The United States has lower life expectancy and higher infant mortality than Canada, which has national health insurance.

STATEMENT 2) Some 47 million Americans do not have health insurance.

STATEMENT 3) Health costs are eating up an ever increasing share of American incomes.
These statements are frequently cited to justify increased government control of medicine, but the article explains why this is fallacious.

(If the NY Times link doesn't work, here's a mirror of the article at the International Herald Tribune.)

Friday, November 2, 2007

Coverage Is Not Health Care

A California breast cancer surgeon working in a rural area explains how her practice was destroyed by government run health care. Here are some excerpts:
Currently, Medicaid expenditure per enrollee is nearly $7,000 per year. This high cost “health plan” gives recipients access to long wait times for fewer doctors, guaranteeing little ability to make healthcare decisions for themselves and their families. Arbitrary decisions made by government employees—nearly 6,000 in California alone—overrule recommendations made by doctors and nurses sitting beside their patients in exam rooms across the state.

Medicaid’s astonishing administrative costs compound the problem. According to 2005 data from the Center for Medicare and Medicaid Services, over 31% of every dollar spent by Medicaid did nothing to provide medical treatment.

...I sustained a personal and professional loss when I was forced to stop providing services as the only breast cancer surgery specialist in a 70-mile radius in central California who still accepted Medi-Cal. I could no longer afford the $10,000-$15,000 monthly hemorrhage related to reimbursement so low it would be cheaper to close my office doors.

My own loss is nothing compared with what the women who will be diagnosed with breast cancer in my community will face. “Coverage” with a government-funded “insurance plan” for them offers no coverage, after all.
(Via Health Care BS.)

Thursday, November 1, 2007

Wednesday, October 31, 2007

The Price Tag of Universal Health Care

In this recent OpEd from October 28, 2007, the Rocky Mountain News asks if the price tag for universal health care in Colorado may be too high:
Tough sell for health-care panel

Is the Colorado Blue Ribbon Commission on Health Care Reform going to lay an egg in January, when by law it must offer its recommendations to the legislature?

It's too early to say, but prospects for the commission's success dimmed somewhat the other day when the price tag was announced for the panel's own proposal - we'll call it Plan Five because the commission will submit four others, too, written by outside groups.

Plan Five's cost: between $1.4 billion and $2.1 billion a year, according to the Virginia-based Lewin Group.

Let's put those figures into perspective.

Two years ago, after a bruising campaign in which millions were spent to promote it, Referendum C passed in a statewide vote by the relatively narrow margin of 53 to 47. Yet as most of you no doubt recall, Ref C did not raise taxes; it only asked the public to give up their tax refunds. And it was not advertised as costing $1.4 billion or more per year. The total cost for Ref C was then projected to be $3.7 billion over five years (a figure that has since gone up).

Meanwhile, Ref C enjoyed far broader support than any health-care tax hike is likely to attract. Although the Republican Party was split on Ref C, the fiscally conservative Republican governor, Bill Owens, supported it and campaigned widely on its behalf. So did Hank Brown, the former Republican U.S. senator noted for his opposition to extravagant government spending, who by then had moved to head the University of Colorado.

Much of the business and civic establishment - not to mention all of the Democratic Party, most of academia and a large majority of commentators in the press - also supported Ref C.

And one final note: Ref C was sold in an atmosphere of budgetary crisis. If they didn't pass the measure, voters were warned, they would doom higher education and virtually every other program not protected in the state constitution or by federal mandate.

Such breadth of support simply isn't in the cards for Plan Five or any other proposal needing an annual infusion of more than $1 billion, and no such sum is available without a tax hike approved by voters.

"Now it's time to see if you can drive down costs in some way," John Sheils, senior vice president of the Lewin Group, told the commission.

Yes, that would be nice, especially since the law passed last year creating the commission gave it two mandates: "To expand health-care coverage and to decrease health-care costs for Colorado residents."

So far, the focus seems mainly on the first half of that charge.

The commission did devote itself to cost-cutting at a recent meeting, but the effort basically amounted to tinkering with the plan. We'd be very surprised if the price tag declined significantly without a wholesale rethinking of how health care is delivered and paid for, and how to alter the incentives that motivate consumers and providers alike. Yet if that's not in the cards, it's hard to see how the state is going to afford such an ambitious initiative - or, perhaps to put the matter more precisely, how the state will find the will to pay for it.
As we've seen repeatedly in other US states and other countries, a government mandated plan simply cannot provide health care that is (1) universal, (2) high-quality, (3) easily accessible, and (4) inexpensive, because it bypasses the free market mechanisms that make this possible. Instead, all government plans end up compromising on one or more of these criteria. In Massachusetts, they've compromised on "universal". Canada compromises on quality and easy access. Colorado should not imitate these failed models.

Tuesday, October 30, 2007

Competition Improves Health Care

The Seattle Post-Intelligencer reports that prices for prescription drugs are falling (after adjusted for inflation), due to market competition:
Competition improves health care

Lo and behold, competition works -- even in health care.

The Labor Department recently reported that the inflation rate for prescription drugs dropped to 1 percent over the past year. That's a 30-year low, well below inflation, and a salve for consumers used to price increases.

It's also no accident. Two big things changed in prescription drugs last year. One is a surge in the use of generics. The other is a fierce retail war among Wal-Mart, Publix and other retail-pharmacy giants, each seeking a bigger share of the market.

...Remember this, what real competition looks like, the next time you hear about "market failures" in health care.

...The decline in drug prices shows that when things go right in health care -- when competitive markets are allowed to function -- prices respond favorably for consumers, just as they do in other sectors of the economy. So while politicians and pundits in Washington dream up the next grandiose health care reform, smart consumers know that the most effective health care solutions may be right around the corner at their local retailer.

Monday, October 29, 2007

Hillman on Mandates

The October 26, 2007 Denver Post has printed the following OpEd by former Colorado State Senator Mark Hillman on the problems with insurance mandates:
Consumers deserve choice in health care
By Mark Hillman

"Everybody talks about the weather, but nobody ever does anything about it." - Mark Twain

You might say the same goes for health care. Politicians are constantly tinkering, making promises they can't deliver, and usually creating a bigger mess than the one they promised to fix.

Ironically, despite the abysmal record of lawmakers and bureaucrats to produce lower prices or create greater choice, the public still clamors for government to "do something." Perhaps the more logical outcry should be: "undo something."

The newest solution du jour is mandated universal coverage — i.e., requiring everyone to buy health insurance and/or requiring all employers to buy it for their employees.

At first, this sounds rather reasonable. State law already mandates insurance for all vehicles licensed in Colorado. Extending the same principle to health insurance would promote personal responsibility, right? After all, we are told that those of us who buy insurance are constantly paying for those who aren't insured and cannot pay.

Reality, human nature ignored

On the other hand, there's reality and human nature — two factors conveniently ignored by so many who always want to legislate the rest of us into their utopian mold.

The first reality is that another law won't produce universal coverage any more than traffic laws eliminate speeding. Even with mandatory automobile insurance coverage, at least 12 percent of vehicles on the road are still uninsured. By contrast, the health uninsured rate is only a slightly higher 16 percent without a similar law.

The next reality is that the auto insurance mandate is fairly simple. State law requires only two types of auto coverage — liability and uninsured motorist — and a minimum of $50,000 coverage for each category. Other than that, we can decide what to buy and how much to pay. We won't be so lucky with health insurance.

Once lawmakers require everyone to purchase insurance, they won't be satisfied to simply mandate $500,000 or even $1 million of coverage. That's because special interests perennially lobby the legislature to require you to buy things you don't need, don't want or can't afford.

Colorado law already requires most health plans to cover at least 16 specific items. Let me put that another way: know-it-all politicians don't think we are smart enough to make our own health care choices, so rather than give us options, they order us to buy what they think we need.

Women who plan to never have children or who are beyond childbearing years must buy maternity coverage. They also, inexplicably, must pay for prostate screening. People who don't drink must purchase coverage for alcoholism. And despite the added cost of mental health coverage, everyone who buys insurance must purchase it.

For many, these mandatory extras make health insurance unaffordable, thereby exacerbating the so-called "crisis of the uninsured."

Strange bedfellows?

If lawmakers didn't spend so much time bashing insurance companies, you might think they were in cahoots. How else do you explain the absurd decree that we must buy insurance for preventive measures, such as mammography or prostate screening?

No one questions the wisdom of these screenings. However, requiring you to finance them through insurance, when you could more easily and less expensively pay for them yourself, doesn't demonstrate lawmakers' compassion so much as their economic illiteracy.

Moreover, any legislator who actually trusts people to decide for themselves and votes against mandatory coverage is usually rewarded with dishonest campaign attacks claiming that he or she opposes coverage for breast cancer, birth defects, diabetes and such.

The end result is that you and I are no longer allowed to choose the insurance coverage that best fits our needs, and insurance companies can't respond to what we want.

Instead, lawmakers and lobbyists control the health care market, as they have increasingly for the past 40 years; then they react in amazement when the product is something you and I either do not want or cannot afford.

Mark Hillman is a wheat farmer in Burlington and a former state senator. Contact him at

Friday, October 26, 2007

Gorman on Medicaid

Linda Gorman, Health Care Policy Center Director at the Independence Institute, has written the following OpEd on Medicaid:
It's Official: Medicaid Managed Care Does Not Save Money

The reform plan drawn up by Colorado's Blue Ribbon Commission on Health Care Reform plans to enroll 50 percent of Medicaid recipients in managed care. Given the history of Medicaid managed care in Colorado, this is an odd recommendation.

Back in the dark ages of Clinton Care 1.0, heath care policy gurus asserted that managed care would save enormous sums. State governments salivated. To sweeten the pot for switchers, the Robert Wood Johnson Foundation and other acolytes of managed care encouraged the notion that Medicaid HMOs could provide better, more coordinated care, at rates that were 95 percent of fee-for-service costs. The usual economic models predicted big savings. Projects were funded. Federal waivers were pursued. Medicaid clients were herded into capitated health plans, and all parties proclaimed the dawning of a new era in health care.

In the heady days of 2002 and 2003 Colorado Medicaid enrolled 50 percent of Medicaid clients in one of five Medicaid HMO plans. Kaiser and United Health pulled out in November 2002. In 2003, two others left. Four of the five original plans sued the state for inadequate payments. They won $77,810,395 in additional payments, along with legislation requiring actuarially sound calculations of capitation rates.

Enrollment in Medicaid HMOs fell. Even though clients in the Denver metro area were automatically enrolled in managed care unless they actively chose fee-for-service, by September 2006 fewer than 10 percent of Medicaid clients were enrolled in risk-based managed care.

In June 2007, Denver Health Medicaid Choice, the remaining Medicaid HMO, informed the state that it would withdraw unless capitation rates were increased to 100 percent of the fee-for-service rates. The state applied for the emergency supplemental appropriation required to fund the increase.

After years of testing, the state has found that Medicaid HMO plans are at least as costly as traditional fee-for-service. They may even cost more. In its December 2006 Joint Budget Committee hearings, the Colorado Department of Health Care Policy and Financing wrote that "Although managed care organizations should experience savings over fee-for-service due to their improved ability to reduce unnecessary hospitalizations, emergency room visits, and other overutilization, there are also extensive administrative costs for care management, utilization management, providing networking to ensure access, and other processes such as bill paying and risk management."

The state could elect to give taxpayers a break and simply make the same payment for the same care regardless of delivery method. People who use the care would simply pick the kind of care they like. They might prefer a private physician to an HMO. In Medicare, where people do have a choice between HMOs and fee-for-service, the data show that healthier people tend to enroll in HMOs. Those most likely to leave HMOs are those in poorer health.

The fact that managed care should cost less but doesn't poses a problem for influential people who have spent their entire professional lives being trained in the managed care creed. Many of them prefer to believe that failure results from too little money and not enough regulation. Undeterred by failure, they want to repeat the Medicaid managed care experiment with more regulation and more tax money.

To attract managed care providers, the Department proposes increasing Medicaid HMO payment rates to 100 percent of fee-for-service payments and adding a 5 percent payment for administrative costs. If these measure fail, it is even investigating the possibility of setting up and running its own Medicaid HMO. The idea is that if it runs its own HMO, it will enjoy lower costs for purchasing and administration. In some particularly florid prose, the Department says that a state run HMO would allow the state to achieve "the efficiency of centralization," a transcendental state that has eluded every other government-run, centralized health care system in the English speaking world.

Meanwhile, the Consumer Directed Attendant Support program, Colorado's innovative experiment with consumer directed care, frees clients from Medicaid centralization, giving them a budget and letting them keep 50 percent of any money they save. In turn, their ingenuity saves the state about 20 percent a year. In the private sector, innovative companies are having similar results when they reduce centralized management by marrying tax free health savings accounts with high deductible health insurance.

Unfortunately, real savings by real people cut little ice with those who think that 50 percent of all Medicaid clients should, for some unknown reason, be in Medicaid HMOs. That the state is demonstrably unfit to run an HMO doesn't matter.

The goal has been set, "the efficiency of centralization" awaits, and real costs are of little real importance when true believers spend other people's money. Look for a massive rollout of results from esoteric theoretical models. These results will prove that state run health facilities will produce big theoretical savings. In practice, the real world is unlikely to oblige.

Wednesday, October 24, 2007

Armstrong Responds to Beauprez

Ari Armstrong has written a detailed response to Bob Beauprez's recent advocacy of insurance mandates. Here is an extended excerpt:
Beauprez's many confusions and distortions call for a more detailed reply.

Beauprez's comparisons to auto insurance and homeowners insurance do not hold. The reason that "motorists are required to have auto insurance" if they wish to use government-run roads (even though many do not obey that law) is that the roads are socialized. It is telling that Beauprez holds up a socialized industry as the standard for medicine. Yet people are not forced to buy auto insurance if they do not use government-run roads. Beauprez wants to force everyone to buy health insurance.

If a lender requires the borrower to purchase homeowners insurance as a condition of the loan, that is properly a matter of voluntary contract, not political controls. But Beauprez is not talking about any sort of voluntary agreement with respect to health insurance: he is talking about legislating new political controls that force everyone to buy health insurance.

Beauprez continues:
Of the 15-17% of the population that is uninsured, the U.S. Census Bureau reports that 56% are 18-34 year old young adults. It is impossible to know for certain, but many of these are no doubt uninsured by choice. Believing they are either permanently healthy, bullet proof, or both, they choose to spend their money on other things than health insurance. If they do get really sick or injured they know that they can go to any emergency room and get treatment whether they can pay or not because of federal law known as Emergency Medical Treatment and Active Labor Act (EMTALA). Some are certainly uninsured because they cannot afford the cost of insurance, but most could afford at least a portion of a monthly premium.

The reality is that when someone doesn't have insurance the cost of their health care is shifted to those that do in higher premiums, and to taxpayers who fund government programs. Cost shifting from the growing number of uninsured to the insured is a huge reality. The biggest challenge hospitals face is to adjust prices to insurance companies for paying customers to cover losses for services to non-paying uninsured patients they are required by law to treat. That invariably is reflected in higher insurance premiums.
It is simply not true that "when someone doesn't have insurance the cost of their health care is shifted to those that do in higher premiums, and to taxpayers who fund government programs."

Beauprez insults my wife and me, who were uninsured for several years. During that time, we paid for routine medical care out of pocket. Not once did we ask any other party to pay for our medical care. Yet Beauprez unjustly insinuates that we were freeloaders.

Why were we uninsured? Was it because, as Beauprez claims, we thought we "are either permanently healthy, bullet proof, or both?" No, Bob, it was not because we were stupid or deluded. I don't need some failed politician to inform me of my motives, thank you very much.

The reason that we chose not to purchase health insurance at that time was that employer-paid insurance was a horrible deal for us. Because of government controls, such insurance acts to transfer wealth away from healthier workers to those with higher costs. We were having a hard enough time paying bills without financing other people's health care to boot.

We made a calculated decision not to purchase health insurance. We looked at our realistic health risks given our age and state of health, took steps to independently maintain our health, planned to buy health care out of pocket, and considered how to handle possible (but unlikely) high-cost treatments.

In other words, our motive was the exact opposite of what Beauprez alleges. We were not trying to push our health-care costs onto others. Instead, we were paying our own way while refusing to finance the health care of others.

Here's how politicians have turned employer-paid insurance into a wealth-transfer scheme. Politicians have entrenched high-cost, non-portable, employer-paid health insurance through federal tax distortions. Because of the tax distortion, such insurance serves as pre-paid medical care, not actual insurance to cover unexpected, high-cost treatment. Our hope with term life insurance, auto insurance, and home insurance is to never need to make a claim. We happily pay our routine auto and home expenses out of pocket. Why, then, do most people expect health insurance to cover all or nearly all of their health costs? It is because of the tax distortion. That's fundamentally why health insurance is so bloody expensive.

And, of course, when practically every purchase of medical care goes through insurance, that adds a lot of processing costs.

When insurance acts as pre-paid medicine, it transfers wealth to insurance companies and to those who often visit the doctor (whether the visits are needed or not). It costs everyone who visits the doctor only occasionally.

Politicians have also required that employer-paid insurance accept all comers, regardless of health, within tightly controlled rates. That's the equivalent of forcing a life-insurance company to charge the same rate for the same policy for a healthy 25 year old and an 80 year old with cancer. What happens is that some people put off buying insurance until they get sick. This increases the rates for everyone (as Beauprez suggests).

In addition, politicians have added all sorts of additional controls that act to transfer health-insurance dollars to members of special interests. In a comment beneath Beauprez's article, Brian T. Schwartz writes:
The rationale for compulsory insurance is the "cost shift from uncompensated care" provided to the under- and uninsured, "which makes private insurance more expensive."

Yet, Health Affairs reports that such uncompensated care is "only 2.8 percent of total personal health care spending." ...

Indeed, politicians have already succumbed to special interests by forcing insurance plans to cover many benefits that you may not need. These mandated benefits laws increase your premiums by 21 to 54 percent. (Council for Affordable Health Insurance,
So is the result of mandated health insurance to reduce "cost shifting?" On one hand, some people who would otherwise shift their costs onto others would be forced to instead purchase insurance. (However, those most likely to shift their costs onto others are also the ones most likely to avoid the mandate.) But on the other hand, insurance mandates increase "cost shifting" by forcing those with low medical costs to subsidize those with high medical costs. Notably, if some people pay only "a portion of a monthly premium," as Beauprez suggests, then that means somebody else must pick up the rest of the tab.

One result it to screw young, working families, at the very point in their lives when they're trying to pay off debts, keep up on bills, start families, and buy homes.

The only just way to reduce "cost shifting" is to remove the political controls that cause it. Beauprez's plan is to "solve" the cost-shifting caused by political controls by adding new political controls that will expand cost-shifting.

Beauprez also claims, "Insured are far more likely to avail themselves of preventative care, get treatment earlier, and avoid serious acuity and expense."

Beauprez's claim is false. When my wife and I were uninsured, we knew that if we didn't take care of ourselves, we'd face higher expenses down the road. We made sure that we ate healthy foods, exercised, avoided unnecessary risks, and checked up on our health. Now that we have high-deductible insurance that we hope never to need, our incentives are basically the same. On the other hand, when people are "insured" for everything, they have less incentive to minimize their long-term health costs.

Again, the problem is political force that allows the uninsured to demand medical care at the expense of others. The proper solution is to repeal those controls, not impose new controls that force people to buy insurance.

Some of Beauprez's proposals (none of which are original to him) are fine, such as reducing the tax distortion that has entrenched employer-paid insurance. But his call for mandatory health insurance overwhelms anything positive he might have to say. "Both Ways Bob" simply does not understand the nature of individual rights, the meaning of free markets, or the proper purpose of government.

It is typical for such conservatives as Beauprez to follow a call for more political force, more state interference in the market, with a sentence like this:

"Any objective observer with even minimal experience with our free market system understands that private competition with limited government interference works."