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