Physician Disempowerment in Canada

Brian Lee Crowley, a senior fellow at the Galen Institute, gave the following speech about physician disempowerment in Canada at the recent Center for Medicine in the Public Interest conference on October 14, 2008.

Here are a few of his speaking points:

1) Potential physicians are severely restricted in their ability to choose their profession
2) Physicians are increasingly restricted in whom they can see
3) Physicians are increasingly restricted in what they can prescribe
4) Physicians are increasingly restricted in getting their patients access to the latest technology
5) Physicians have totally lost the power to determine what they will charge
6) Physicians are gaining some slight ability to practice in both the public and the private sectors after having lost that right for years.
7) Physicians have great difficulty getting their patients treated in a timely manner

Point 6 is the one slender silver lining in the otherwise bad news.

The others are the inevitable consequences of any system of "universal health care".

When the government attempts to guarantee a good or service such as health care as a universal "right", it must necessarily control the creation and distribution of that service. This removes the control from the physicians who create the service and the patients who purchase it. Instead, the government determine who gets what care and when. In the end, rather than being a "right", health care becomes a de facto privilege dispensed at the discretion of bureaucrats.

Hsieh LTE in The Economist

The October 14, 2008 edition of The Economist magazine has posted my LTE on health care, written in response to their article on health care in the US presidential race, "Running For Cover" from two weeks ago.

(It did not appear in the printed edition, only in the online edition):

Running for cover, October 4th

SIR - Governments should not guarantee health care as a "right" ("Running for cover", special briefing on the US election, October 4th). Rights are freedoms of actions (such as the right to free speech), not automatic claims on goods and services that must be produced by others.

Individuals are legitimately entitled to services such as health care that they purchase with their own money, are promised by prior contractual agreements, or are given to them via voluntary charity.

Otherwise, government programs to guarantee health care as a "right" must necessarily violate someone's actual rights - either the rights of those compelled to provide medical care or the rights of those compelled to pay for it. Such programs then become just another form of state-sanctioned slavery or theft.

Dr Paul Hsieh
Co-founder
Freedom and Individual Rights in Medicine
Sedalia, Colorado

UK Physicians Paid To Not Send Patients to Hospitals

The October 19, 2008 UK paper The Telegraph reports that British physicians practicing in the government-run National Health Service (NHS) have been paid thousands of pounds to not send patients to hospitals for specialist treatments:

Dozens of incentive schemes have been uncovered which allow GPs to profit by slashing the number of patients they refer for hospital care.

Under one scheme, GPs stand to gain £59 for every patient not referred to hospital, if they cut an average referral rate by between two and eight per cent.

...A leading surgeon said that patients' cancers had already gone undiagnosed after they were denied specialist care under two such "referral management" schemes.

Orthopaedic surgeon Stephen Cannon... said: "I recently encountered two cases in which patients referred to physiotherapists later turned out to have a malignant tumour. If they had been sent to a consultant the outcome may have been very different.

"In one case a young man was referred to a physiotherapist because of sudden knee pain. Had he come to a specialist the symptoms should have been recognised and he should have been urgently referred to an oncologist. In this case, after the delays, the outcome was amputation. It was devastating for the patient and his family.

Remember, this is the "compassionate" system of socialized medicine, in which all patients have a theoretical "right" to health care.

Of course, in reality, whenever a government attempts to guarantee health care as a right, it must also control that service. Far from being a "right", health care becomes a privilege dispensed at the discretion of government bureaucrats.

Cost containment will eventually take precedence over quality of care. The results in UK are tragic, but should not be surprising. The only question is whether Americans will learn from this example...

(Via Instapundit.)

Hsieh LTE in Rocky Mountain News

The October 16, 2008 Rocky Mountain News printed my latest LTE on health care, in response to their 10/13/2008 OpEd, "Dueling Med Plans":

Obama's plan would move us toward government health care

Thank you for your healthy skepticism about Obama's proposed health care "reforms". The last thing this country needs is a massive new bureaucracy that would crowd out private health insurance. The Obama plan would be just another step towards a complete government takeover of American medicine.

We've already seen this with Medicare, which has essentially destroyed primary private health insurance for American over age 65. Older Americans essentially live under a system of socialized medicine, and every year we see how their health care is held hostage to partisan political wrangling.

Do we really want to inflict this on all Americans?

There are genuine problems with the current health care system.

But forcing everyone into a government-run health system to "solve" the problem of the uninsured would be like forcing everyone into government-run housing projects to "solve" the "problem of homelessness".

Paul Hsieh, MD, Sedalia

Hawaii Ending Universal Child Health Care

After only 7 months, the state of Hawaii is discontinuing its system of "universal health care" for children (emphasis mine):

Gov. Linda Lingle's administration cited budget shortfalls and other available health care options for eliminating funding for the program. A state official said families were dropping private coverage so their children would be eligible for the subsidized plan.

"People who were already able to afford health care began to stop paying for it so they could get it for free," said Dr. Kenny Fink, the administrator for Med-QUEST at the Department of Human Services. "I don't believe that was the intent of the program"...

We've seen similar problems in other states such as Tennessee, where a government "right" to health care undermines and eventually destroys the private market. This in turn leaves patients and physicians at the mercy of government bureaucrats.

Fortunately, Hawaii learned this lesson before it was too late. Will the rest of America?

(Via multiple readers, including Brian Schwartz, Kelly McNulty, and Robb LeChevalier.)

Whittle On Rights

As mentioned earlier in the comments, Bill Whittle has written a nice piece on rights in the October 9, 2008 edition National Review Online. Here is an excerpt:

...Constitutional rights protect us from things: intimidation, illegal search and seizure, self-incrimination, and so on. The revolutionary idea of our Founding Fathers was that people had a God-given right to live as they saw fit. Our constitutional rights protect us from the power of government.

But these new so-called "rights" are about the government -- who the Founders saw as the enemy -- giving us things: food, health care, education... And when we have a right to be given stuff that previously we had to work for, then there is no reason -- none -- to go and work for them. The goody bag has no bottom, except bankruptcy and ruin.

Does that ring a little familiar these days? Because isn’t the danger here that if you’re offered something for nothing... you'll take it?

Only it's not something for nothing. "Free" health-care costs us something precious, and no less precious for being invisible. Because there's a word for someone who has their food, housing and care provided for them... for people who owe their existence to someone else.

And that word is "slaves."

Whittle identifies the central issue -- rights are freedoms of action (and corresponding restrictions of government power). They are not entitlements to goods and services that must be produced by others.

I also liked his identification of the fact that a welfare state turns both the producers and the recipients of these redistributed goods into slaves. That's a point that cannot be emphasized enough.

(Disclaimer: This should not be construed as any kind of general endorsement of NRO or Whittle. I like much of Whittle's writings, although I have disagree with his characterization of rights as "God-given". For a secular discussion of the nature of rights and the objective facts that give rise to that concept, see "Man's Rights" by Ayn Rand. I also have other disagreements with Whittle on issues not related to this particular topic.)

LaFerrara on NJ Health Care Reforms

The October 14, 2008 edition of the New Jersey Star-Ledger printed the following LTE by Mike LaFerrara supporting free market health care reforms in New Jersey:

Insurance freedom

A free market is a recognition of every individual's inalienable right to think and act on his own judgment, including entering freely into contractual agreements with others for his own well-being. It leaves him free from coercive interference by others, including government officials and politicians. Anything else is a violation of those rights. The health insurance crisis is directly attributable to the lack of a free market.

Assembly Bill 2767, the New Jersey Healthcare Choice Act, would be a huge step toward rectifying this injustice. The bill would open up New Jersey's insurance market to policies offered in any state. Individuals and health insurance companies from around the country would be free to contract voluntarily to mutual advantage. Unfortunately, a hearing on this bill is being blocked in committee, according to one of its sponsors, Assemblyman Jay Webber.

Insurance Committee Chairman Gary Schaer should end this blockage. If "government of the people" means anything, Trenton should end the rights-violating restraint-of-trade practice of forbidding state residents from buying out-of-state health insurance policies and enact this bill into law.

-- Michael A. LaFerrara, Flemington

This would be a good step in the right direction. Plus, state legislatures could easily implement this reform without permission from the federal government -- all they need is the political will.

Commentary on Obama Vs. McCain

The October 13, 2008 Rocky Mountain News comments on both the Obama and McCain health care plans. With respect to the Obama plan, they note:

The Obama plan, meanwhile, gives birth to a bouncing new bureaucracy: the National Health Insurance Exchange...

Over time, for that matter, some federal entity would have to decide what would be added and subtracted by the public plan -- in order to control costs, among other reasons. Former Sen. Tom Daschle, a longtime universal health care proponent and Obama adviser, has touted his idea for a Federal Health Board to make those sensitive choices. That also makes us nervous.

The October 3, 2008 Washington Post also does a little fact-checking on Biden's claims about the McCain plan during the recent Vice-Presidential Debate. They conclude that his criticisms are misleading:

Joe Biden gave the impression that most Americans would be worse off financially as a result of Sen. John McCain's health-care proposals. He drew on a study by the journal Health Affairs to suggest that 20 million people would lose their company-provided health insurance under the McCain plan. He failed to note that the same journal calculated that another 21 million people would be able to afford health insurance for the first time because of tax credits offered under the McCain plan.

...According to the nonpartisan Tax Policy Center, the McCain proposals would result in a net benefit of $1,241 to the average taxpayer in 2009, $895 in 2013, and $386 in 2018. Taxpayers in the top quintile would be slightly worse off by 2018, but other taxpayers would be slightly ahead.

The Washington Post therefore awarded Biden "TWO PINOCCHIOS" for "Significant omissions or exaggerations".

(Disclaimer: FIRM does not endorse either McCain or Obama.)

Jeffers on Socialized Medicine

The October 13, 2008 Rocky Mountain News carried the following LTE by Tish Jeffers on Canadian health care:

Socialized medicine great, but don't get sick
Tish Jeffers, Centennial

I had the opportunity to live in Canada for almost 20 years, so I think I have a fair background in how socialized, government-orchestrated medicine works.

Keep in mind, there are approximately 32 million people in Canada and approximately 302 million people in the United States.

My assessment then, as it is now when I talk to my aging Canadian friends: Socialized medicine is great... as long as you never get really sick!

What I find interesting is that if socialized medicine ever comes into play here in the United States, Americans will never stand for the waiting, the lines, the paperwork and the bureaucracy the Canadians put up with when they go to the doctor. We won't have the option, like our Canadian friends do, to load up on buses and come over to the United States to get the instant care most of us take for granted!

It isn't medicine that needs reform, it's the insurance companies that need reform. The government has screwed up so many things, like our current issue with our finances! Do we want them messing around with our medicine, too?

Jeffers is quite right -- the Canadian system controls costs through rationing and waiting lists.

However, the problems in the US should not be blamed solely on insurance companies. Much of their behaviour is driven by onerous government regulations that prevent them from offering cost-effective services in a free market to willing customers. For more, please see our article on "universal health care".

Williams on Health Care and Rights

Blogger Michael Williams discusses why health care is not a right. He correctly notes that rights impose only negative obligations on people, not positive entitlements. Here are a few excerpts from his essay:

...[T]hink about what it would mean for health care to be a right. When you consider the ramifications even an inch beneath the surface you run into all sorts of problems.

Every right one person has imposes an obligation on someone else:

* Right: Free speech. Obligation: We have to let you talk, even when you stay stupid or dangerous things.
* Right: Free religion. Obligation: We have to let you go to any church you want, or none at all, even if we think you're corrupting our country.
* Right: Free assembly. Obligation: We have to let you meet with your dumb friends.
* Right: Due process. Obligation: We have to give you a trial, even when it's clear that you're guilty.

...With the exception of the right to trial-by-jury, I think all the rights specified in the Constitution create negative obligations on the rest of society. Your right obligates me and the government to not do anything to impede it. In contrast, positive obligations require me not just to leave you alone, but to actually do something for your benefit.

He notes that any alleged "right" to health care actually means the following:

* Taxpayers will be obligated to pay for others' health care under threat of force
* Doctors will be obligated to provide health care at the government's direction
* Insurance companies will be obligated to cover or not cover people or ailments at the government's direction
* Employers will be obligated to pay for health care of whatever kind mandated by the government

The issue of health care really cuts to the core of the difference between leftists and conservatives.

Conservatives believe that "rights" express our fundamental freedoms that cannot be taken away by anyone. The only obligations created by conservative "rights" are negative obligations that require you to stay out of my business.

Leftists believe that "rights" express obligations that the government can impose on us by force. Leftist "rights" create obligations on us to spend our time, money, and effort on other people regardless of our own desires. That's not freedom, that's slavery.

He is absolutely correct in his assessment that entitlement rights are just a form of state-sanctioned slavery. And I completely agree with his major points.

For a discussion and defense of the nature of individual rights on fundamental philosophical grounds, I highly recommend the classic essay by Ayn Rand, "Man's Rights".

I do have two additional remarks.

First, the biggest problems with modern conservatives is that too many are deliberately straying from the classical liberal ideals of an earlier generation marked by a respect for individual rights. When self-described "conservatives" advocate for more government interference with individual rights, such as Mitt Romney's mandatory insurance requirement in Massachusetts or McCain's calls for greater environmental regulations, the political debate then becomes between different forms of statism, not between freedom and slavery. This is painfully obvious in the current 2008 election cycle. Professor Bradley Thompson has written a detailed analysis of the problems with modern conservatism in this The Objective Standard article, "The Decline and Fall of American Conservatism".

Second, I think one can make an argument that jury duty can and should be voluntary. But this is a very minor and peripheral issue, better suited for a different venue.

"Never Events" and Medicare

Medicare (aka CMS or Centers for Medicare/Medicaid Services) has now implemented a policy of not paying for certain bad patient outcomes that they call "never events". These include certain kinds of bedsores, post-operative infections, etc.

It's being portrayed as a measure to ensure quality and reduce costs. But physician-blogger WhiteCoatRants predict it will lead to some nasty unintended consequences:

1. You'll get diagnosed with a lot more illnesses so that it is very difficult to determine what care is not for a "never event" and what care is for the "never event." Then when you have to stay in a hospital longer because of a "never event," the hospital can allege that the extended stay was really due to a problem that was not a never event. That will mean more testing, more procedures, and higher costs.

2. If you develop a "never event," you’ll be more likely to get transferred to another hospital. CMS won't pay for never events if they develop in a hospital, but they will pay for treatment if you present with a pre-existing never event. Hospitals will develop unwritten agreements that certain specialists at each other's facilities are better suited to treat a certain patient's "never event." More transfers mean more redundant testing, higher costs, and more complications from the testing.

3. Testing and diagnosis of never-event conditions will diminish where feasible. That bedsore isn't a Grade 3 - it's only Grade 2. CMS will pay for those.

He predicts that these measures won't actually control costs. Then the government will propose to "rescue" the failing system with a complete takeover:

Enter the knight in the shining armor -- the same government that put us into this mess. "Let's try universal healthcare/single payor," the knight says from atop his noble steed.

...Whichever way you look at it, healthcare as we know it is about to change for the worse.

We're screwed.

Although I hope he's wrong, I fear he's right. Hence, one important point that physicians and policy makers should keep in mind as this process unfolds over the next few years is to make sure that the blame for these unintended consequences is placed where it belongs -- on new government rules and regulations. If legislators recognize that skyrocketing costs are caused by the government, then they might do the right thing and repeal some bad laws. But if they are only told that the problem is "greedy" insurance companies or "greedy" physicians, then this will give them more reasons to press for full-bore socialized medicine.

We've already seen this in the recent $700 billion Wall Street bailout, where the "free market" was blamed for problems caused by government interference in the free market.

This must not happen to American medical care, otherwise we'll all pay a price (in both money and lives) that will make the current $700 billion seem like chump change in comparison.

Commodity, Right, or Responsibility?

One of the questions asked during the October 7, 2008 Presidential Debate was whether health care should be treated as a commodity.

Both candidates argued that it shouldn't, with Obama saying that it was a "right" and McCain claiming that it was a "responsibility".

Unfortunately, both candidates are trying to deny the obvious. Health care is a commodity in the broadest sense of that term: a good or service created by businessmen for trade in the marketplace. As such, the producers of health care (like the producers of any other commodity such as food, shelter, or cell phones) require freedom in order to produce. Government regulations that infringe upon that freedom will stop producers from creating this valuable commodity, as we've already seen in countries such as Canada and the UK.

The fact that modern health care is essential for human life makes it all the more crucial to allow the free market to work and to restrain the government from violating the rights of patients and health care providers. Any attempts by the government to guarantee health care as a "right" necessarily violates someone's actual rights -- either the providers or those forced to pay for others' health care against their will or both. Hence, Americans must reject the flawed notion of health care as some sort of "right" and embrace the fact that it is a commodity.

For the proper approach to thinking about this issue, I know of no better starting point than Dr. Leonard Peikoff's, "Health Care Is Not A Right".

Svorny on Free Market Reforms

The October 6, 2008 Los Angeles Times carried a good opinion piece by Dr. Shirley Svorny (professor of economics at Cal State Northridge), supporting free market health care reforms. Here is an excerpt:

...[L]et's deregulate medical care so that providers can find innovative ways to deliver high-quality care cheaply. Let's eliminate the increasingly strict education requirements for clinicians and let medical professionals offer walk-in physicals or other services at competitive prices. Like Wal-Mart and MinuteClinic, they will rely on brand name and reputation to assure quality.

We also need to better promote health savings accounts, which put spending in the hands of consumers and encourage them to shop around for low-cost alternatives.

Retail clinics are only the first step. My hope is that the increased access and reduced costs will quickly become evident and will build support for additional innovations -- and the deregulatory policies necessary to make them possible.

Universal coverage sounds appealing, but it means government will be running the trains. Here and abroad, government does not have a good record when it comes to access, oversight or innovation.

Her economic arguments are sound, and they provide good reinforcement of the more fundamental rights-based ethical argument for free market health care reforms. (Via Kelly McNulty.)

The Failure of Single-Payer Health Care

The Vancouver-based Fraser Institute has released another report on the problems with the Canadian single-payer system. Here are a few noteworthy excerpts from the press release about their peer-reviewed study, "The Hidden Costs of Single Payer Health Insurance: A Comparison of the United States and Canada":

The study shows that health care in Canada appears to cost less because relative to the United States, Canadian public health insurance does not cover many advanced medical treatments and technologies, common medical resources are in short supply, and access to health care is often severely delayed.

"On average, Americans spend more of their incomes on health care but they get better access to superior medical resources," [co-author Brett] Skinner said.

"If Canadians had access to the same quality and quantity of health-care resources that American patients enjoy, the Canadian health-insurance monopoly would cost a lot more than it currently does."

According to the most recent data, the United States outscores Canada on many key indicators of available health care resources, including:

* Number of MRI units per million population in 2006: US: 26.5; Canada: 6.2
* Number of MRI exams per million population in 2004/05: US: 83,200; Canada: 25,500
* Number of CT Scanners per million population in 2006: US: 33.9; Canada 12
* Number of CT exams per million population in 2004/05: US: 172,500; Canada 87,300
* Number of inpatient surgical procedures per million population in 2004: US: 89,900; Canada: 44,700.

...Even on health insurance coverage, the Canadian system does not perform much better than the U.S. when it comes to actually delivering insured access.

"Access to a wait list is not the same thing as access to health care," Skinner said.

The study cites government data showing an estimated 1.7 million Canadians (aged 12 and older) were unable to access a regular family physician in 2007. And it points to other research showing that the actual number of "effectively" uninsured Americans is less than half of the figure usually reported and that being uninsured is usually only a temporary condition.

Based on these figures, the study estimates that the percentage of the population that was "effectively" uninsured for non-emergency, necessary medical services at any given time during 2007 was not significantly different between the two countries: 7.9 percent in the U.S. compared to six percent in Canada.

"When Canadians can't get access to health care because they can't find a physician or wait so long that they are effectively uninsured, they are no better off than uninsured Americans," Skinner said.

(For the record, I do disagree with the authors' support of an individual insurance mandate for reasons covered here.)

Arizona Updates

Sandy Szwarc notes two positive stories from Arizona.

First, she has a nice writeup of Dr. Steven Knope's efforts to practice quality medicine free from onerous insurance company restrictions in a concierge practice. For more on this, see his blog.

Second, she reports on the proposed "Freedom of Choice in Health Care Act", which would prevent the state from imposing a Massachusetts-style individual insurance mandate on its residents.

As Sue Blevins, RN (and president of the Institute for Health Freedom) notes:

Supporters of the ballot initiative want to ensure that no health-reform scheme will strip them of their freedom to pay privately for health care. Opponents are concerned that if the initiative passes, it could preclude mandatory socialized health insurance.

Sounds good to me! I just wish Colorado voters had the chance to support a similar measure, which would go a long ways towards protecting our individual rights in health care.

Pipes on the Uninsured

Sally Pipes, president and chief executive officer of the Pacific Research Institute, has written an excellent analysis of the supposed "45 million uninsured" in America and why the problem has been greatly overexaggerated:

45.7 Million or 8 Million?: Focus on the narrow problem

Officials at the U.S. Census Bureau recently released new health insurance figures purporting to show that the number of Americans officially classified as uninsured in 2007 was 45.7 million, down from 47 million in 2006.

Despite the decline, the new figure is being spun as proof positive that America's healthcare system is still in awful shape. Advocates of socialized medicine are repeating it ad nauseam, arguing that the main problem with the country's health system is the massive uninsured population. After all, if a whopping 15 percent of the population is uninsured, then the current system must be failing.

As Dr. Oliver Fein of Physicians for a National Health Program wrote when the figure came out, "[t]he plight of the uninsured… shows how the for-profit, private health insurance model of financing health care has outlived its usefulness."

But it’s grossly misleading to use the Census Bureau number as an indication of a crisis. A closer look at the agency’s survey methods reveals that the situation isn’t nearly as bad as the pundits and the politicians would have you believe.

To generate this figure, the Census Bureau relied entirely on a questionnaire known as the Current Population Survey (CPS). The survey is intended to garner information about, among other things, the income, age, race, living situation, and, of course, health insurance status of individuals living in the United States.

As with any survey of this size and scope, the accuracy of the data it produces has substantial margins of error. As the Census Bureau itself explains in its annual report, "health insurance coverage is likely to be underreported on the Current Population Survey."

The Census Bureau doesn't tell us that 45.7 million people are chronically uninsured for the entire year. The agency has stated elsewhere that "the CPS estimate of the number of people without health insurance more closely approximates the number of people who are uninsured at a specific point in time during the year than the number of people uninsured for the entire year."

In other words, many of the survey respondents counted as "uninsured" may have experienced only a temporary interruption in their insurance. This circumstance is quite common. When workers quit or lose their job, they are technically uninsured. But they are usually in transition between one employer-provided insurance policy and another.

Despite the media’s tendency to depict the 45.7 million uninsured as a single, homogeneous group, the demographic character of these individuals cuts across age, ethnic, and socioeconomic categories. Many are uninsured for reasons unrelated to cost and don’t need to be “rescued” by mandatory socialized medicine.

We may be accustomed to thinking of the uninsured as low-income individuals and struggling families. But the Census Bureau data show that many are relatively affluent. Over 17.5 million -- 38 percent -- of the uninsured make more than $50,000 a year. And 9.1 million have an annual income of over $75,000 a year.

How can this be? In part, it's because a number of financially comfortable young Americans choose not to purchase health insurance. Known in the healthcare trade as the "invincibles" -- because they’re so sure they won't get sick -- these young singles would rather keep their money than shell out for expensive monthly insurance premiums because of the many mandates and regulations place on insurers by the states.

This intentional avoidance of health insurance is quite common. According to the Commonwealth Fund, Americans age 19-29 comprise one of the largest and fastest-growing segments of the uninsured population.

If the fact that over a third of the uninsured are pulling down more than $50,000 a year isn’t shocking enough, how about this: Nearly 10 million uninsured aren't even U.S. citizens!

It's certainly unfortunate that these individuals don't have health insurance, of course. But they can still get free treatment in emergency rooms. And even a fully nationalized healthcare system would be unlikely to provide them with health insurance.

Another 14 million of the uninsured are fully eligible for government assistance through programs like Medicare, Medicaid, and SCHIP.

How does that break down? A 2008 study by the Georgetown University Health Policy Institute showed that a whopping 70 percent of uninsured children are eligible for Medicaid, SCHIP, or both programs. And roughly 27 percent of non-elderly Americans who are eligible for Medicaid haven’t enrolled and simply live their lives without health insurance, according to the Urban Institute.

Is it really fair to say that such individuals don’t have health insurance? Further, if millions of Americans aren't availing themselves of taxpayer-funded coverage, why should we think that an even bigger government healthcare bureaucracy would solve the problem?

Of course, there are people who really do fall through the cracks. These are the chronically uninsured -- the working poor. They are people who struggle to hold down jobs and support their families. They earn less than $50,000 per year but too much to qualify for government help. They simply can’t afford insurance.

There are roughly 8 million of these chronically uninsured. Any attempt to solve the problem of the uninsured should focus on this narrow slice of the 45.7 million person pie.

The key to helping these people isn’t to create more government red tape. In fact, too much regulation is why health insurance is so expensive in the first place. What these people need is straightforward, affordable coverage that will cover them in the event of a health catastrophe. They should be able to purchase insurance in the state that has the best plan for them, regardless of where they live.

It's true that far too many Americans go without health insurance. And that is a serious problem. But the Census Bureau figure shouldn’t be presented as anything other than what it really is: an imprecise snapshot of a heterogeneous group of Americans, many of whom wouldn't benefit from additional government intrusion into the healthcare market.

It's almost as if some people want to inflate the size of the problem for their own political purposes...

Hsieh LTE in Rocky Mountain News

The October 2, 2008 Rocky Mountain News also printed my short LTE opposing the employer health care mandate:

Keep government out of benefits arena
Dr. Paul Hsieh, Sedalia

I'd like to thank the Rocky Mountain News for opposing Amendment 56, which would force most businesses to offer health insurance to their workers ("Let's make a deal/There's still time to pull some ballot measures," Sept. 3).

Businessmen create jobs through hard work and rational thought.

Consequently, they have the moral right to decide on what terms to offer these jobs to prospective employees, including specific wages and benefits.

Conversely, workers have the right to negotiate for any wages and benefits they desire, and the right to reject offers they don't like. But they have no right to demand a specific salary or benefit (such as health insurance) through government force.

To "solve" the problem of high insurance costs by foisting those costs onto businesses would be just as wrong as "solving" the problem of high gasoline prices by forcing businesses to pay their workers' gasoline expenses. The proper solution is not more government regulations but free-market reforms that address the actual underlying problems.

This piece is a shorter version of my longer OpEd on the same topic.

Fortunately, it looks like Amendment 56 will be removed from the 2008 ballot as part of a deal reached between Colorado labor unions and business groups.

Feds Prop Up Massachusetts Plan

The September 30, 2008 New York Times reports that the federal government is pumping still more money into the Massachusetts plan to keep it from failing:

Gov. Deval Patrick announced in Boston that the state and the federal Centers for Medicare and Medicaid Services had negotiated the extension of a waiver that enables federal financial support for the state's subsidized coverage plan. The agreement will allow the state to spend up to $21.2 billion on the program over the next three years, an increase of $4.3 billion over the initial three-year period.

This is the plan that is so expensive that middle-class residents (e.g., a family of four making $63,000 per year) needs subsidies from the state to afford the state-mandated insurance.

The October 1, 2008 Boston Globe also reports a similar story, although it gives somewhat different figures:

...Massachusetts will be able to expand its first-in-the-nation healthcare law because of a federal promise of $10.6 billion over the next three years, Governor Deval Patrick said

The state is also adding more mandates onto businesses:

Under the new rules, the larger companies would have to pay 33 percent of their workers' premiums within 90 days of hiring and make sure that at least 25 percent of their workers are covered by the plan. Otherwise, the employer must pay a $295 fine per worker.

Businesses with fewer employees would still be allowed to follow the old rules, Bigby said, and meet only one of the two requirements to escape the penalty.

This is sure to drive even more businesses out of state.

Supporters of the Massachusetts plan like to claim that it has reduced the number of uninsured in the state. But it's cost hundreds of millions of dollars more than promised, and many of the newly insured don't actually get the care they need -- they have "coverage" but not care.

The NYT article also notes that Massachusetts officials admit that the plan might fail without the new deal made with the federal government.

If the federal government adopted a similar plan, who would bail out the US?

United HealthCare Analysis of HSAs

United HealthCare is completed a year-long analysis of Health Savings Accounts (HSAs) and drawn some interesting positive conclusions. In particular, they note the following:

"Health Savings Accounts: A year-long look at adoption, usage and funding patterns"

* HSAs have application across income groups, consumer life stages and varied employer environments.

* To encourage participation and make plans as useful as possible, employers should consider making contributions to the accounts. Even in their early years, HSAs show evidence of flexing to the specific needs of savers versus spenders.

* Positive balances at year-end are an encouraging indicator of HSAs ability to help make health care more affordable.

As one would expect, giving patient control over their medical spending decisions works!

More Waiting In Massachusetts

The September 22, 2008 Boston Globe reports that waiting times in Massachusetts continue to grow longer:

Across Mass., wait to see doctors grows

The wait to see primary care doctors in Massachusetts has grown to as long as 100 days, while the number of practices accepting new patients has dipped in the past four years, with care the scarcest in some rural areas.

...[I]n Great Barrington, Volunteers in Medicine, a clinic for the uninsured, is for the first time treating insured patients. It has taken weeks for newly insured residents to find doctors who will accept new patients, and months longer to get an appointment.

...Amherst family physician Kate Atkinson decided to open her practice to new patients in January partly so she could take on the newly insured, especially since, by her count, 18 doctors in the area had closed their practices over the last two years... She closed her practice to new patients again six weeks later. "We literally have 10 calls a day from patients crying and begging," she said.

This is just another illustration of the fact that "coverage" does not equal care.

Universal health care can promise the first, but not the second. Massachusetts patients know this first-hand. It's too bad that their politicians don't realize that yet.

Hsieh Article on Massachusetts Mandates

The Fall 2008 issue of The Objective Standard will be carrying my article on mandatory insurance and the Massachusetts health plan entitled, "Mandatory Health Insurance: Wrong for Massachusetts, Wrong for America".

The full text is only available to subscribers, but nonsubscribers can purchase copies of the PDF file here for only $4.95. (I don't get any money from these purchases.) The print edition of the journal will also be available for purchase in many Barnes & Noble bookstores.

For those who are interested, here is the free preview of the opening section:

"Mandatory Health Insurance: Wrong for Massachusetts, Wrong for America"

Paul Hsieh

The Plan and Its Popularity

In April 2006, Massachusetts became the first state in the nation to require that all of its residents purchase health insurance. This mandatory insurance was the centerpiece of a “universal” health care law hailed by analysts as an “innovative bipartisan plan.”[1] Republican governor (and former presidential candidate) Mitt Romney proclaimed that “every uninsured citizen in Massachusetts will soon have affordable health insurance,” that costs would be reduced through “market reforms” encouraging “personal responsibility,” and that the plan would require “no new taxes... and no government takeover.”[2] The plan had support from organizations and individuals across the political spectrum, including the conservative Heritage Foundation, the liberal group Health Care for All, and Democratic Senator Ted Kennedy.[3]

The Massachusetts plan was, in part, a response to today’s health care costs, which are rising twice as fast as inflation, making insurance increasingly unaffordable for many employers and individuals.[4] Currently, approximately 47 million Americans have no health insurance.[5] In an effort to solve the problem in their corner of the country, Governor Romney and the Massachusetts state legislature enacted this plan with the twin goals of reducing the cost of health care and guaranteeing coverage for all Massachusetts residents.

The Massachusetts plan consisted of the following major elements: The state would establish a quasi-governmental authority known as the Commonwealth Health Insurance Connector (or “Connector”) to serve as a clearinghouse through which individuals would be able to purchase state-approved insurance plans. Every resident would be required to purchase a health insurance plan, either from a private insurer or though the Connector, with stiff financial penalties for those who failed to comply.[6] Residents who could not afford insurance would have their expenses subsidized by the state in part or in full, depending on their income. Employers with more than ten employees would be required to provide health insurance for their workers or pay a special fee to subsidize coverage for low-income individuals.[7] In theory, the plan would lower individual patients’ insurance costs by enlarging the pool of insured patients. In particular, younger, healthier patients (who often choose not to purchase insurance) would be required to do so, thus paying a portion of the health costs of the larger population.[8]

The plan was attractive to liberals and conservatives alike. Liberals embraced it because it supposedly promised “universal coverage” without requiring them to support politically risky Canadian-style “single-payer” socialized medicine.[9] Conservatives embraced it because it supposedly encouraged “personal responsibility” while preserving a “market framework” for health insurance.[10]

For these reasons, mandatory health insurance has become popular with politicians in both major political parties, including Republican California governor Arnold Schwarzenegger and former Democratic presidential candidates Hillary Clinton and John Edwards.[11] The idea has been endorsed by the National Small Business Association and the National Business Group on Health (an association of large businesses).[12] Several states besides Massachusetts and California—including New Jersey, Ohio, Rhode Island, Pennsylvania, Illinois, and Colorado—have considered or are considering some version of mandatory health insurance.[13]

Yet two years after its inception, the Massachusetts plan has failed to achieve either of its goals. The plan did not lower health care costs, nor did it achieve universal coverage. Thus, given the growing popularity of mandatory health insurance, Americans would do well to take a close look at the results of the Massachusetts plan—and, more importantly, at the reasons for those results...

----------

Endnotes

Acknowledgments: I would like to thank Diana Hsieh, Lin Zinser, and Brian Schwartz for their enormously helpful suggestions and advice.

1 William C. Symonds, “In Massachusetts, Health Care for All?” Business Week, April 4, 2006.

2 Mitt Romney, “Health Care for Everyone?” Wall Street Journal, April 11, 2006.

3 Edmund F. Haislmaier, “The Significance of Massachusetts Health Reform,” Heritage Foundation Web Memo #1035, April 11, 2006; Marilyn Werber Serafini, “The Mass.-ter Plan,” National Journal, June 10, 2006, pp. 3–4.

4 Milt Freudenheim, “Health Care Costs Rise Twice as Much as Inflation,” New York Times, September 27, 2006; Julia Appleby, “Health insurance premiums vault past inflation,” USA Today, September 11, 2007.

5 John Donnelly, “47 million Americans are uninsured,” Boston Globe, August 29, 2007.

6 “Health Care Reform Act of 2006,” http://www.mass.gov/agr/news/health_care_reform_act.htm; and Boston Business Journal, “Mass. health insurance penalties to spike in ’08,” December 31, 2007, http://boston.bizjournals.com/boston/stories/2007/12/31/daily4.html.

7 Serafini, “Mass.-ter Plan,” p. 4.

8 Betsy McCaughey, “The Truth About Mandatory Health Insurance,” Wall Street Journal, January 4, 2008.

9 Christopher Lee, “Simple Question Defines Complex Health Debate,” Washington Post, February 24, 2008.

10 Edmund F. Haislmaier, “The Massachusetts Health Reform: Assessing Its Significance and Progress,” Heritage Foundation Lecture No. 1044, June 28, 2007, pp. 6–7.

11 Kevin Sack, “Massachusetts Faces a Test on Health Care,” New York Times, November 25, 2007.

12 Kent Hoover, “Business groups split over individual health mandate,” Silicon Valley/San Jose Business Journal, February 29, 2008; “Big business backs health insurance,” Associated Press, January 30, 2008.

13 David W. Chen, “New Jersey to Consider Health Plan to Cover All,” New York Times, March 18, 2008; “Healthcare Group Recommends ‘Individual Mandate’ on Health Insurance,” Gongwer News Service Ohio, March 26, 2008; “R.I. studying Mass. health plan,” Barre Montpelier Times Argus, November 26, 2007; Laurie McGinley, “Should Insurance Be Mandatory?,” Wall Street Journal, June 30, 2007; Reed Abelson, “Mandatory Coverage Is Easier Said Than Done,” New York Times, June 11, 2007; Tim Hoover, “Health coverage gets new push,” Denver Post, March 28, 2008.

Massachusetts Retrospective

Sandy Szwarc takes a look back at the last two years of Massachusetts' "universal coverage" plan. It's not a pretty picture.

PatientPower Wins Blog Contest #4

Brian Schwartz's PatientPower blog was the winner in Week 4 of the Anti-Socialized Medicine Blog Post Contest.

The winning entry was his post, "Single-Payer Health Care: Immoral and Deadly". Congratulations, Brian!

The contest host also linked to this good piece, "That's One Hard Pill to Swallow". Here are a few excerpts:

...Under a "free" healthcare system, there are no barriers to entry. Insignificant coughs, sneezes and short-term, low-grade fever are all valid reasons to see a physician. No longer is anyone held accountable financially for their inability to discern a true reason for visiting the doctor from a serious illness that requires examination. Accountability fails because no one pays attention to the pre-tax payroll deductions taken from their income. And there’s no accountability when no one has to pay anything up-front.

With a service that has no accountability by its users, there are two ultimate choices that must be made by the governing body to continue to provide "free" healthcare. The first, and probably the easiest, is to increase tax revenue to pay the physicians for the increased patient load and free presciptions. The second is to decrease the number of available doctors or, worse yet, cut the salaries of doctors on staff in a bid to keep expenses down. While increasing taxes to pay for your neighbor's expensive habit of visiting the doctor every other day for watery eyes or a splinter may be annoying, having open heart surgery by someone who just had their pay slashed 30% to meet budgetary contrains is scary. With either option, it's still one hard pill to swallow.

He is absolutely right. Whenever the government attempts to guarantee a good or service like health care as a "right", it will inevitably also seek to control it. The result will be restrictions and rationing, just as we've seen in every other country with "universal health care". The only difference is the exact form such rationing takes. Americans should learn from the examples of Canada, UK, Sweden, Germany, France, etc. and not go down this dangerous and deadly path.

Restaurants Vs. Medical Care

Here's an excerpt from the short satirical piece, "What if the restaurant business followed the medical mindset?":

...Doesn’t he know that food is a basic right? I can’t go on if these meals become too expensive. Why does he keep raising the rates? There needs to be some kind of intervention. A system where food can be given to the good citizens of this nation so that we can eat and know that our bellies will not starve. On top of that, I need everything on the menu, right now, and for free. And I don’t care how many times they tell me that the food won’t mix well together. Don’t let laziness be an excuse.

(Via KevinMD.)

Canadians Tell Krugman About Socialized Medicine

At a recent live debate in New York City, some Canadians tell New York Times columnist and single-payer advocate Paul Krugman what they really think of socialized medicine:

PAUL KRUGMAN:
Actually, can I just — I wanted to ask a question. And—

JOHN DONVAN:
Please—please do—

PAUL KRUGMAN:
—and I wanted to ask, actually two questions, to the audience. First, how many Canadians, would Canadians in the room please raise your hands. [ONE PERSON APPLAUDS, LAUGHTER]

JOHN DONVAN:
We have about seven hands going up—

PAUL KRUGMAN:
Okay, not as many as I thought. Okay, of those of you who are not on the panel who are Canadians, how many of you think you have a terrible health care system. [PAUSE] One, two—

JOHN DONVAN:
We see—almost all of the same hands going up. [LAUGHTER]

PAUL KRUGMAN:
Bad move on my part. [APPLAUSE]

(Via Instapundit.)

Single-Payer Health Care: Immoral and Deadly

[The following is a mirror of the original post at PatientPower. ]

The following letter on the dangers and immorality of single-payer health care was co-authored by Brian Schwartz, Ph.D. and Paul Hsieh, M.D. in response to an article in the April 2008 issue of Annals of Surgery supporting such a policy (Sarpel U, Vladeck B, Divino C, et al. Fact and Fiction: Debunking Myths in the US Healthcare System. Ann Surg 2008; 247(4):563-569; available at Medscape here, registration required [free]).

The journal describes itself as "the world's most highly referenced surgery journal, provides the international medical community with information on significant contributions to the advancement of surgical science and practice."

The Editorial Board rejected it. The reviewer stated:

This is a very biased and vitriolic letter. There certainly is a broad range of opinion as to the best system of health care for the United States and open discussion is to be encouraged. However, to call a single payer system, that serves much of the Western world with equal or better results than we achieve in the United States, “immoral” and “deadly” is inappropriate and serves no purpose. Prior to consideration for publication, this letter needs to be toned down several notches.

The reviewer apparently believed that it was out of bounds to question either the morality of single-payer health care or the alleged fact that it yielded "equal or better results" than the American system. Of course, these were the very points that we believed needed to be challenged and discussed in an open fashion.

Also, as shown here, while the journal was "happy to evaluate a revised version of this manuscript," the reviewer provided minimal guidance on appropriate revisions, and our request for more constructive feedback was ignored.

We submitted a revised version, which the reviewer found "not acceptable for publication in the Annals of Surgery." We'd like to let readers decide for themselves. Here is the complete text of the revised version:

Single-Payer Health Care: Immoral and Hazardous to Patients' Health

In "Fact and Fiction: Debunking Myths in the US Healthcare System"^[1], Sarpel et al presume "an obligation to provide healthcare to those who need it." This faulty moral premise underlies all forms of socialized medicine (including the single-payer system they advocate) and should be rejected by Americans as immoral and antithetical to core American values.

The only moral and proper role of government is to protect individual rights of its citizens. But health care is a need, not a right. A right is a freedom of action one possesses, such as the right to free speech. Rights are not automatic claims on goods and services produced by others -- that is just state-sanctioned robbery. If a man is hungry, he doesn't have the right to take a can of soup from his neighbor's pantry. A man's rights imposes only the negative obligation on others to not violate those rights, not a positive obligation on others to provide for all his needs.^[2]

Whenever a government attempts to guarantee any service (such as health care) as a "right," it must also control it. This can only be done by violating citizens' actual rights. Under a government-run single-payer system, bureaucrats ultimately decide who receives what care and when, not doctors and patients. Doctors must work under the government's terms and for the government's prices. The inevitable result is a system like Canada's, which harms both patients and doctors through its infamous waiting lists and rationing.

Canadian patients routinely suffer and die while waiting for their "free" health care. According to the Vancouver-based Fraser Institute, "Canadian doctors say patients wait almost twice as long for treatment than is clinically reasonable, ...almost 18 weeks between the time they see their family physician and the time they receive treatment from a specialist."^[3] A Canadian woman with a newly-diagnosed breast cancer might wait several months before she receives the appropriate surgery and chemotherapy.^[4] The Canadian Medical Association noted, "Protracted treatment delays increase mortality and morbidity rates. [In a 12-month period in Ontario], 71 patients died while waiting for CABG [and] 121 were removed from the list permanently because they had become medically unfit for surgery."^[5] The Supreme Court of Canada summarizes these injustices: "[W]aiting lists for health care services have resulted in deaths, have increased the length of time that patients have to be in pain and have impaired patients' ability to enjoy any real quality of life."^[6]

The Canadian single-payer system takes its toll on doctors as well. According to the New York Times, significant numbers of frustrated neurosurgeons have left Canada for the US (a net loss of 49 out of a total of 241 in the entire country over a six year period). The surgeons' primary complaint was not money but rather a government bureaucracy which "increasingly rations service because of various technological and personnel shortages," making it impossible for them to practice according to their best medical conscience.^[7]

American health care has genuine problems, but they were not caused by the free market but rather from decades of government interference in the free market, as documented in an article co-authored by one of us (PSH).^[8] For example, politicians should not dictate whether consumers buy insurance on their own, through a membership group, or through their employer. But, as Sarpel et al acknowledge, the tax-exempt status of employer-sponsored insurance does just that. It locks employees to their jobs, shields insurance companies from competition, and encourages excess insurance coverage which gives patients little incentive to be cost-conscious consumers.^[9]

Instead of worsening the current government-caused problems by imposing more futile controls, politicians should adopt free-market reforms that respect individual rights. At the federal level, legislators should eliminate the employer tax break and lower tax rates commensurately. A second-best solution would be to extend the tax exemption to all medical insurance and expenses. Health Savings Accounts are a step in this direction, but should be eligible to everyone regardless of their insurance plan. Such "Large HSAs" would allow consumers to buy medical care and insurance with tax-free earnings.^[9]

State-level reforms to make insurance affordable include eliminating mandatory insurance benefits, community rating, and guaranteed issue. Largely because of such controls, the average price of individual and family insurance in the five most expensive states is three times the price in the five least expensive states.^[10] Repealing laws that forbid purchasing health insurance across state lines would make health insurance available to millions who currently cannot afford it, while respecting individual rights.^[11]

The free market has done a magnificent job in providing Americans with all other necessities of life, such as food, shelter, and clothing, and can do the same for health care if freed from government interference. Patients trust their physicians with their health and their lives. Physicians must not betray that trust by turning them over to the tender mercies of a single-payer socialized medical system that, as we contend, would be both deadly and immoral. They should instead demand free-market reforms.

================

Citations

1. Sarpel U, Vladeck B, Divino C, et al. Fact and Fiction: Debunking Myths in the US Healthcare System. Ann Surg 2008; 247(4):563-569. (Available at Medscape here, registration required [free])

2. Peikoff L, revised by Zinser L. Health Care Is Not a Right, Denver: Freedom and Individual Rights in Medicine; 2007.

3. Skinner B, Rovere M, California Dreaming: The Fantasy of a Canadian-Style Health Insurance Monopoly in the United States. Fraser Institute Digital Publications, Fraser Institute, May 2007: 1–4.

4. Saint-Jacques N, Younis T, Dewar R, et al. Wait times for breast cancer care. Br J Cancer 2007; 96:162-168.

5. Davies R. Waiting Lists for Health Care, a Necessary Evil?. Can Med Assoc J 1999; 160(10): 1469–1470.

6. Steinbrook R. Private Health Care in Canada. N Engl J Med 2006; 354:1661-1664.

7. Krauss C. Windsor Journal; Doctors Eying the U.S.: Canada Is Sick About It, New York Times. October 27, 2003.

8. Zinser L, Hsieh P. Moral Health Care Vs. "Universal Health Care''. The Objective Standard. Winter 2007-2008; 2(4):9-41.

9. Cannon M. Large Health Savings Accounts: A Step toward Tax Neutrality for Health Care, Forum for Health Economics & Policy 2008; 11(2) Article 3.

10. America's Health Insurance Plans. Individual Health Insurance 2006-2007: A Comprehensive Survey of Premiums, Availability, and Benefits. December 2007.

11. ...And Escape From New Jersey, Wall Street Journal. May 29, 2008. A16.

Hsieh OpEd on Employer Insurance Mandate

The September 19, 2008 edition of the Rocky Mountain News has printed my OpEd supporting free market health care reform and opposing Colorado Amendment 56 (which would require businesses with more than 20 employees to purchase health insurance for all its workers):

Free market reforms healthier than Amendment 56

By Paul Hsieh, MD
Friday, September 19, 2008

This fall, Colorado voters must decide whether to require all businesses with more than 20 employees to provide health insurance for their employees (Amendment 56). Although voters may be tempted to say "yes," this is an immoral and impractical solution to the problem of rising health insurance costs.

It is morally wrong because it violates the rights of employers and employees to negotiate to their mutual self-interest in a free market.

Businessmen create jobs through rational thought and hard work. Consequently, they have the moral right to decide on what terms to offer those jobs to prospective employees, including specific wages and benefits.

Similarly, workers have the right to negotiate for any specific wages and benefits they desire, and the right to reject job offers that don't meet their criteria. But they have no right to demand a specific salary or benefit from employers (such as health insurance) via government force.

Two motivations behind this proposed law are (1) the mistaken notion that health care should be a guaranteed "right," and (2) the desire to force businesses (rather than government) to pay for this supposed obligation. But health care is a need, not a right. A right is a freedom of action in a social context, such as the freedom of speech.

It is not an automatic claim on a good or service that must be produced by someone else. There is no such thing as a "right" to a car or an appendectomy. Any attempt by the government to guarantee a false "right" to health care can only be done by violating the actual rights of someone — in this case, business owners.

Forcing businesses to provide health insurance to employees will also cause serious economic harm to Colorado. Such a law would cause many businesses to fire workers, outsource jobs, or cancel plans to hire new workers. This will disproportionately harm unskilled workers and those at the lower end of the income scale — the very people the measure is intended to help.

According to Howard Roerig, owner of Seale & Associates, Inc. in Centennial, "This measure will have a chilling effect on all small businessmen. Although I don't have 20 employees at present, I would make certain never to hire that 20th person. The costs would be so high that I would be better off starting another firm in a different state, and letting it do business in Colorado as an out-of-state firm.

"I would have to find some means of skirting this measure or else close my doors."

Other states such as California have driven away many businesses and jobs due to high taxes and heavy regulations. Colorado must not repeat these mistakes.

To "solve" the problem of high insurance costs by foisting those costs onto businesses would be just as wrong as "solving" the problem of rising gasoline prices by forcing businesses to pay their workers' gasoline expenses.

Our current high health care costs have been caused by decades of government interference in the free market. Hence, the proper solution is not more government regulations, but instead free market reforms that addressed the problems caused by prior government controls.

Some examples of free market reforms include allowing Coloradans to purchase health insurance across state lines and eliminating mandatory insurance benefits. Patients should be allowed to purchase Health Savings Accounts (HSAs) for small routine expenses and insurers should be allowed to sell low-cost catastrophic-only policies to cover rare but expensive events. These measures could greatly reduce insurance prices and allow patients to purchase from the best offerings of all 50 states, thus making insurance available to thousands of Coloradans who want to purchase it but currently cannot afford it. Furthermore, the state legislature could adopt these reforms without permission from the federal government.

If Coloradans want to address the problem of high health insurance costs, they should reject the Amendment 56 and instead demand free market reforms. This is right for employers, right for employees, and right for Colorado.

Paul Hsieh, MD, of Sedalia is co-founder of Freedom and Individual Rights in Medicine (FIRM)

I'd like to thank Ari Armstrong for suggesting that I write about this issue and Howard Roerig for providing me with a fantastic quote that concretizes the economic issues at stake.

The Dangers of Medical Licensing

Dr. Shirley Svorny, professor of economics at California State University, Northridge, and an adjunct scholar at the Cato Institute, has written a good position paper on the dangers of medical licensing. Here's an excerpt:

Medical Licensing: An Obstacle to Affordable, Quality Care

...One view is that state licensing of medical professionals assures quality. In contrast, I argue here that licensure not only fails to protect consumers from incompetent physicians, but, by raising barriers to entry, makes health care more expensive and less accessible.

...Consumers would benefit were states to eliminate professional licensing in medicine and leave education, credentialing, and scope-of-practice decisions entirely to the private sector and the courts.

She covers many of the same points that Alex Epstein of the Ayn Rand Institute mentioned in this short piece from September 14, 2007:

End Government Licensing

...The more complex the field, the more destructive coercive licensing is, because the more urgent it is that there be freedom of thought and action. In a vast, continually evolving field like medicine, in which a huge and growing range of medical procedures exists, each requiring different skill sets, it is absurd and incredibly costly to have the government reserving jobs for full-fledged MDs that could be done by other medical professionals, while giving an official stamp of approval to MDs who do jobs that they lack necessary specialized knowledge to do (such as general practitioners who prescribe complex psychiatric medications).

It may be funny when governments takes charge of licensing fortune tellers, but it is deadly when it is in charge of licensing doctors. We should abolish the government's coercive licensing power and unleash a free market of objective-standards bodies who function by persuasion, not compulsion.

(Via Brian Schwartz.)

Week 3 Winners in Blog Contest

The Week 3 winners for the Anti-Socialized Medicine Blog Contest have been announced.

The 1st place winner was, "I Hate Socialized Medicine".

2nd place was, "Universal Health Care, Socialised Medicine, Single-Payer Systems And Other Modern Fairytales".

3rd place was, "When the Private Sector Fails, it means we Need More Government. When the Government Fails, it means...Nothing".

I enjoyed reading all of them, and I hope they get a wide circulation!

British Parody of Government Paternalism

This short satirical video mocks the arrogance and paternalism of the bureaucrats who run the British educational system, but most of the arguments apply equally well to socialized health care. Or socialized anything!



The American equivalent in health care would be ABC News Medical Editor Dr. Tim Johnson's comments on individuals buying health insurance directly from an insurance company instead of through one’s employer. He stated (halfway through the following video):

The idea that individuals are going to have enough knowledge and enough savvy and enough insight and, frankly, enough guts to make choices all by themselves is pretty much a pipe dream.

(Via Brian Schwartz.)

Military Medicine and Universal Health Care

Medical care for military personnel is one area in which the US government does provide guaranteed health care, and I regard this as a legitimate function of government. However, even in this case, it is worth recognizing that rationing is part of the system.

The rationing is quite explicit and it occurs by rank, as recounted by this former military physician:

...[A]s the thought of a single government run healthcare is considered by many, should we not learn from our prior experiences? Medicare is about to go broke, the military healthcare system, while constantly shifting as Congress approves or disapproves its budgets, has seen a dwindling of its ability to care for those most deserving due to costs. Rationing has helped the military cope with their limits, but for the military, rationing is simple since rank and duty status are so obvious.

What would happen if a similar healthcare system was thrust upon the greater civilian population? Where will people be shunted in our new system when we realize it is too expensive or we have too few doctors to provide the care? In short, how will our "rank" be determined? Can we really expect that universal healthcare will not exact a toll on each and every one of us?

Americans will not stand for the rationing inherent in government-run medical care that Canadians and the British put up with routinely. And few politicians will acknowledge this reality either -- instead they promise voters that government-run care will bring free, fast, high-quality service to everyone.

Americans must recognize that health care is a commodity -- i.e., a good or service that must be produced by others using their rational minds. Hence, it is subject to all the inexorable laws of economics. Those who produce this service have the moral right to dispose of it in a free market under terms negotiated voluntarily between producer and consumer.

Whenever the government attempts to force production of a commodity on its terms rather than the producers, it violates the producers' rights and destroys the freedom necessary to create the commodity in the first place. The inevitable result is shortages and rationing as we've seen repeatedly throughout history -- just think of the wheat shortages in the former USSR, automobile rationing in the former East Germany, and the current economic disasters in Zimbabwe and North Korea.

In this respect, health care is no different from any other commodity. And this is why we need free market health care reforms, not more government intervention.

Mandated Coverage Lesson

One approach towards guaranteeing "universal coverage" is to require insurance companies to sell policies to all comers, regardless of medical history. But states that have already attempted that find that they can't evade economic realities:

A few states began requiring insurers to take on all comers in the 1990s after a run at national health insurance failed during the Clinton administration.

South Dakota enacted the guarantee mandate in 1995. By 2001, claims exceeded the premiums collected by $2 million. By 2003, the state was down to only three major insurers; one, American Family Insurance Group, notified state officials that it was about to leave, too.

"We regret having to take this step, but the losses incurred on our individual major medical products in South Dakota are unacceptable," wrote Jack C. Salzwedel, a company vice president, in April 2003. "Most of our losses are directly attributable to the basic and standard policies that we are forced to write."

The South Dakota state legislature eventually decided to repeal the coverage mandate.

Insurance companies create value by offering a financial service to customers that allows them to spread the risk of rare but expensive adverse events, such as a major illness or accident. They have the right to sell their policies on any terms they wish based on their own judgment as to what's in their best interest as a business. Similarly, customers have the right to decide whether to purchase those policies (or not) based on their own judgment as to what's in their best interest as individuals. Customers cannot demand guaranteed health insurance, regardless of the cost to insurers.

With these sorts of mandated coverage systems, either the government must force private companies to run at a loss, or it must impose additional taxes to pay the additional expenses, creating in effect yet another government welfare program. Either approach violates individual rights, just in different ways.

It's about time our politicians learn this lesson.

Fire The Insurance Company

A recent article from the Texas Medical Association suggests that doctors may do better if they "fire the insurance company". Here's the introduction:

For More Quality Time With Patients, Some Physicians Fire Insurance Companies

A type of old-fashioned medical practice is making a comeback in some corners: While most physicians contract with one or more insurance companies, some are no longer accepting health insurance at all. They want to increase their quality time with each patient, reduce hassles, and return to their passion – healing people...

Of course, patients, providers, and insurers have the right to contract in a free market to their mutual interest. But the current insurance market is so distorted from decades of government interference that it is a far cry from a true free market. What we now call "insurance" is more like a form of pre-paid health care, rather than a mechanism for protecting patients from rare-but-expensive events, such as a serious accident or illness. For example, we don't think of "car insurance" as paying for our routine oil changes, but we use "health insurance" to cover similar routine medical expenses.

The subsequent perverse economic incentives leads to inefficient spending and skyrocketing costs.

Patients and physicians who choose to contract directly without going through the current insurance system thus have the opportunity to benefit. Patients get better care and have more control over their health care spending. Doctors are able to practice better medicine according to their conscience and gain greater professional satisfaction. Both sides win as a result.

How Much Do State Mandates Cost?

According to the National Center for Policy Analysis, a lot:

* A family purchasing a health insurance policy in Wisconsin would pay about $3,087, but that policy would cost $10,398 in New Jersey.

* A similar policy in Utah would cost $3,259, compared to $12,254 in New York.

* A family policy in Michigan would cost $4,118, but an astronomical $16,897 in Massachusetts.

Thus, the difference in premiums is largely the result of state mandates that inhibit the creation of a national market, not regional variations in health care costs.

Read the whole thing for more information as well as some proposed free market solutions.

Person X on Health Insurance

From the March 7, 2008 Wall Street Journal comes the following great OpEd on government paternalism, including its application to health insurance. I'm deliberately omitting the author's name for now:

...Health-care paternalism creates another problem that's rarely mentioned: Many people can't afford the gold-plated health plans that are the only options available in their states.

Buying health insurance on the Internet and across state lines, where less expensive plans may be available, is prohibited by many state insurance commissions. Despite being able to buy car or home insurance with a mouse click, some state governments require their approved plans for purchase or none at all. It's as if states dictated that you had to buy a Mercedes or no car at all.

Who's the author? Former Democratic Senator and 1972 presidential candidate George McGovern.

Plus I also pretty much agree with the rest of his OpEd.

Life is full of pleasant surprises!... (Via Haight Speech.)

Anti-Socialized Medicine Blog Post Contest

We're honored and grateful to John Hawkins for selecting one of our posts as the Week 2 winner of "The Anti-Socialized Medicine Blog Post Contest".

The contest is sponsored by RightWingNews.com and David All Group.

The winning entry was our post: "UK Doctors Withholding Treatment Information From Patient".

Our friend Paula Hall at Ms. Think won 2nd place for: "Pay Doctors, Don't Enslave Them".

We'd also like to thank John and the sponsors for coming up with this unique way of fighting for individual rights and free market medicine.

If anyone out there has an interest in blogging on this topic, there's still time to enter Week 3's contest!

UK Says, "Oops -- Our Bad"

According to this August 28, 2008 article in The Daily Mail, the UK government has apologized for its earlier policy which denied patients with the eye disease "wet age-related macular degeneration" from receiving a drug that could save their sight ("Too late: After thousands of patients needlessly go blind, NICE boss says sorry for delays in sight-saving drugs").

Initially, their policy was:

...[T]hat patients had to wait until they went blind in one eye before they would be given treatment to save the sight in the other.

According to the article, during the past two years, "many hundreds of patients have gone blind -- some of them needlessly" as the result of a government policy described as "cruel and unnecessary".

But least the head of the government medical rationing agency did express his "genuine sorrow".

I feel much better now about single-payer care. Don't you?

(Via Kelly McNulty.)

Hsieh LTE on Massachusetts in New York Times

The September 7, 2008 New York Times has printed my LTE on health care "reform" in Massachusetts, responding to their August 30, 2008 editorial, "The Massachusetts Way". They edited it slightly from the version I submitted, but kept the essential meaning intact, including the concept that "health care is not a right".

It is the 7th (final) letter on this page:

To the Editor:

Far from being a "success," Massachusetts health care "reform" has cost the state hundreds of millions of dollars more than anticipated and created long waits for care.

The Massachusetts system is just socialized medicine in a new guise. It is no coincidence that the long waits for care in the state resemble the long bread lines in the Soviet Union.

The fundamental problem with the Massachusetts system (or any system of "universal health care") is that it erroneously treats health care as a "right." There is no such thing as "right" to a good or service that must be created by others — that's just state-sanctioned theft or slavery. The problems in Massachusetts are the inevitable result.

Paul Hsieh
Sedalia, Colo., Aug. 30, 2008

The writer is the co-founder of Freedom and Individual Rights in Medicine.

As an example of the "long waits", the April 5, 2008 New York Times reported in their article, "In Massachusetts, Universal Coverage Strains Care", that some patients in Western Massachusetts with "guaranteed" health coverage must wait over a year for a routine physical examination.

Although some people blame these waits on a shortage of physicians, the New England Journal of Medicine notes that this is not true, in this article from April 27, 2008, "Physician Workforce Crisis? Wrong Diagnosis, Wrong Prescription":

Massachusetts has seen its supply of physicians per capita more than double since 1976, and it now has the highest physician-to-population ratio of any state, in primary care as well as overall.

Concierge Physician Vs. BC/BS

Dr. Steven Knope was recently interviewed by the Arizona Republic about his concierge medicine practice. When Blue Cross/Blue Shield Insurance (BC/BS) heard about it, they chose to terminate his contract.

BC/BS claimed that they were "looking out for their members", to make sure that physicians charge the agreed-upon rates to BC/BS patients. But Knope points out that when he sees his concierge patients, it's a matter of private contract between him and them. According to this article in the September 5, 2008 Arizona Republic:

Knope... said he doesn't submit insurance claims to Blue Cross or any other insurance company for his 120 concierge patients. However, he has another 100 patients who are not part of his concierge practice. If Blue Cross terminates his contract, he said he will be forced to drop some of those patients.

"It is not going to hurt me financially, but it is going to hurt my (traditional-practice) patients," Knope said. Blue Cross "is hurting no one but their own members."

Rather than protecting their patients, BC/BS's actions look more like an effort to intimidate him and other like-minded physicians in an attempt to stifle a competing business model.

Fortunately, it appears that BC/BS's tactic will backfire. As Dr. Knope notes:

Because concierge doctors do not work for third-party payers, because we contract directly with our patients for medical care, being dropped from an insurance plan does not affect us. It does not affect our patients. The real story is not that another insurance company behaved badly. The real story is that it didn't matter!

And he stands to do financially better in the long run as a result of BC/BS's actions.

More significantly, Dr. Knope also explicitly recognizes and defends his stance in a principled fashion:

I'm all for free-market medicine and competition. Concierge medicine is the first example of real competition to enter the medical marketplace in years. This interchange with BC/BS is an example of how the free-market sorts things out. Blue Cross has every right to refuse to do business with me. Likewise, I can decline to do business with them. I don't need the government to protect me from "big business." I can simply offer a different kind of medical care and allow the public to choose where they want to spend their healthcare dollar.

I hope this business model takes off, since it offers tremendous promise for patients and physicians alike.

Daily Danet on Health Care Rights

The blogger Daily Danet has a pretty good post entitled, "Why Healthcare is not a Right".

Overall, I liked it. His arguments are very similar to the ones Leonard Peikoff made in his essay, "Health Care is Not a Right".

The Daily Danet post correctly distinguishes between a right and a need, and he also correctly distinguishes between genuine rights vs. entitlements masquerading as "rights". Although I have a few minor disagreements, on the whole I thought it was a good piece.

But I also believe Dr. Peikoff's piece does a better job identifying and articulating the key philosophical principle more clearly (which is no surprise since he has a PhD in philosophy). In particular, Dr. Peikoff notes:

Observe that all legitimate rights have one thing in common: they are rights to action, not to rewards from other people. The American rights impose no obligations on other people, merely the negative obligation to leave you alone. The system guarantees you the chance to work for what you want--not to be given it without effort by somebody else.

Nonetheless, I'm glad that the Daily Danet piece is getting some wide circulation as a consequence of being the first winner in the 4-week long "Anti-Socialized Medicine Blog Post Contest".

If it spurs some discussion on the nature of rights and gets others to ask why health care should not be considered a right, then this will be good for America.

We Need A National Market In Health Insurance

In the August 27, 2008 issue of the Wall Street Journal, Grace-Marie Turner of the Galen Institute explains why, "We Need a National Market for Health Insurance".

(If the WSJ link is broken, here's a mirror of the article on the Galen website.)

UK Doctors Withholding Treatment Information From Patients

The August 26, 2008 Telegraph reports yet another example of the corrosive effect that nationalized health care has on the doctor-patient relationship.

The paper reports that many British oncologists (cancer specialists) deliberately don't tell their patients about all the possible treatment options, because some of those options would not be permitted under the government system, even though they may be available in other countries. Most of the time, these treatments are unavailable in England because of the expense.

Some of the British oncologists rationalized their policy on the grounds that, "there was 'no point' in discussing treatments their patients could not have" and that such a discussion might "distress, upset or confuse" their patients. But whether these doctors intend it or not, they've stopped being advocates for their patients and instead become agents of the government.

If a patient is willing to spend his savings for a medication that might help him live longer, he should have that right. Patients rely on their physicians for information about the full range of alternatives (including an honest appraisal of the various risks, costs, and benefits) so that they can make fully informed decisions about their lives. For a doctor to fail to provide that information would be a massive breach of his or her ethical responsibility to the patient.

But this is the predictable result when the government pays the doctors' salaries, rather than the patients. The physicians are then beholden to their employers and start working in the best financial interests of the government, not the patient.

And what makes the system especially evil is not the fact that it allows a few doctors to act badly, but rather that it takes good doctors and turns them into bad physicians willing to betray their patients.

American advocates of "universal health care" should ask themselves if this is what they really want...

(Via Medical Progress Today.)