Trojan Horse

The June 1, 2009 Washington Times has an OpEd by Michael Leavitt and Jeffrey Anderson discussing why the proposed "public plan" is a Trojan horse for a complete government takeover of medicine.

Their analysis of the problems of Medicare and the even-worse problems with a "public plan" are correct.

I do disagree with their statement that, "Every American should have access to affordable health insurance. Government must take strong action to make that possible."

The only action that the government needs to take is to get out of the way and allow the free market to work. If the government sticks to its legitimate function of protecting against the initiation of force and/or fraud, then we'll see massive improvements in health care and health insurance as willing entrepreneurs and businessmen spring up to offer services to patients.

We've seen the relatively-free market provide Americans with abundant affordable food, clothing, and housing. It's time we let it work for health care as well.

Rhoads: Force Is Not Competition

Jared Rhoads, director of the Lucidicus Project, has written another excellent OpEd, this time on force and pseudo-competition, as it applies to the proposed "public plan".

Here is his piece in its entirety, reposted with his permission:

Force is not competition
By Jared M. Rhoads
May 12, 2009

A letter to the editor in yesterday's edition of the New York Times calls for health insurance companies to be forced to compete with a public health plan administered by the government. "And if they fail," the writer goes on, "they should get out of the health insurance business."[1]

Compete? What a strange concept to apply to a scenario in which one party deals by voluntary trade, and the other deals by force.

Private insurers compete with each other to provide the best product they can on the market. Their costs are based on the payments that they can negotiate with providers, voluntarily. Their revenue is based on the number of customers they can attract, voluntarily. These companies are contractually obligated to provide that is clearly stated in the policies they underwrite. Many of these companies are quite large. Dealing with them can sometimes feel impersonal. But no matter how big they are, they cannot "wield power" capriciously, break contracts arbitrarily, or force you to subsidize your neighbor's premium. Consumers have recourse if they do.

The government, on the other hand, has no other way but to deal by force.[2] It gets price advantages by strong-arming providers (and will almost certainly be dictating care options before Obama's term is over). It gets operational advantages by hamstringing the private industry with regulations. And whatever revenue the government cannot raise from premiums, it can confiscate through taxation and inflation. That's not a business model. That's organized crime.

Many advocates of the public option proudly acknowledge that their plan amounts to one massive Medicare-for-all program that would likely have the effect of wiping out the insurance industry altogether. Yes, that is the same bureaucratic Medicare that is racked with unprecedented levels of fraud and abuse and which now faces insolvency as soon as 2016 or 2019.[3] The purpose of the public option is political, and if it is allowed to be implemented, the results will be ugly.

_____

1 Blaine, M. "Re Schumer Points to a Middle Ground on Government-Run Health Insurance" New York Times, Letter to the Editor, May 12 2009

2 The delegation of force to the government is appropriate only for the purpose of protecting individual rights. This is true for the military, police, and court system.

3 Will, G. "Dr. Leavitt's Scary Diagnosis" Washington Post, January 1 2009

More broadly, this is another example of the statists conflating economic power with political power.

But rather than the usual claim that allegedly evil private companies' use of economic power in the marketplace is equivalent to using force against helpless consumers, they're reversing the claim to promote the idea that the government's use of genuine force is just another benign form of economic power in the form of "competition". This is just an old fallacy in a new guise.

Thank you, Jared, for highlighting this issue!

How US Health Care Stacks Up

Because so many advocates of "universal health care" point towards other countries as models for our own, it's important to see exactly how the US compares with those other countries.

Investors Business Daily has a nice chart summarizing some key statistics, including survival rates for various cancers, waiting periods for treatments, and the supply of medical scanners:



Here's the related article.

As John LaPlante notes:

We certainly don't have a perfect approach to health care in this country. But we're doing some things right... We should build on what we've got right--a modicum of freedom from government control--not remove it.

Ups and Downs in Massachusetts

The May 28, 2009 New York Times reports on continued problems in the Massaschusetts system of "universal" health care.

As we've noted before, patients now have "coverage", but do not have access to actual care. The article notes:

Massachusetts, Model for Universal Health Care, Sees Ups and Downs in Policy

...The difficulties in receiving care were severest among low-income residents, who have gained the most from expanded access under the state's law, passed in 2006. It requires most residents to have health insurance and provides state-subsidized plans for the poor. Massachusetts now has the country’s lowest percentage of the uninsured -- 2.6 percent, compared with a national average of 15 percent.

But the study, which was scheduled for publication Thursday in the journal Health Affairs, found that increased demand for care from the newly insured was confronting an insufficient supply of willing physicians. One in five adults said they had been told in the last 12 months that a doctor or clinic was not accepting new patients or would not see patients with their type of insurance. The rejection rates for low-income adults and those with public insurance were double the rates for higher-income residents and those with private coverage.

The government could attempt to "solve" this problem by next forcing doctors to take patients who have the public plan. Or outlaw private plans altogether. Doctors will then no longer be independent providers of medical services, but serfs of the state. This is the path towards socialized medicine.

Or the government can abandon its attempt to guarantee universal health care and instead implement free market reforms.

The next few months will tell us which way this country will head.

Video: Universal Car Care

The Galen Institute has sponsored a contest for the best short video (less than 90 seconds) on the dangers of "universal health care".

You can see their entries here.

Brian Schwartz especially liked this one, "Universal Car Care":

Physician Shortages

David Catron explains the link between universal health care and physician shortages.

Luntz's Talking Points

I've had a busy Memorial Day weekend on call at the hospital, so I don't have a blog post for today.

But take a look at Brian Schwartz's post on Frank Luntz's health care talking points.

Many of the points that Luntz raises are good ones.

But as the debate over universal health care descend into a nitty-gritty battle of power politics, it is critical that advocates of free market health care reform find ways to communicate their message in terms that resonate with average Americans without resorting to emotionalism or pragmatism. Our victory or defeat may will depend on whether we can articulate our ideas in a way that is both principled and persuasive.

How Washington Will Ration Health Care

The May 19, 2009 Wall Street Journal explains "How Washington Will Ration Health Care":

Try to follow this logic: Last week the Medicare trustees reported that the program has an "unfunded liability" of nearly $38 trillion -- which is the amount of benefits promised but not covered by taxes over the next 75 years. So Democrats have decided that the way to close this gap is to create a new "universal" health insurance entitlement for the middle class.

Such thinking may be a non sequitur, but it will have drastic effects on the health care of all Americans -- and as it happens, this future is playing out in miniature in Medicare right now. Desperate to prevent medical costs from engulfing the federal budget, the program's central planners decided last week to deny payment for a new version of one of life's most unpleasant routine procedures, the colonoscopy. This is a preview of how health care will be rationed when Democrats get their way...

Unless Americans speak out against "universal" health care, this will be our future...

Bernstein On Innovation

David Bernstein raises a good point on medical innovation that more politicians should be thinking about:

I don't have the expertise to discuss the various health care reform proposals that are being bandied about, but I do know that it's important to ensure that whatever is implemented doesn't interfere with innovation.

Consider my own immediate family. I was born a month premature, a bit over three pounds, in my parents' bedroom after an extremely short (like 5 minutes) labor. I was rushed to the hospital, where I stayed for over a month in a "warmer". A decade or two earlier, I would have been a goner. Two and a half decades later, my cousin's son survived being born three months premature and weighing less than two pounds...

[Multiple other examples]

...Oh, and you can add my wife, who not too long ago would have died due to complications in one of her pregnancies. Indeed, before the invention of ultrasounds, the doctors wouldn't have even known about the problem until it was way too late.

Given all this, it's not surprising that I get a bit antsy when I hear some politicians talk as if health care is a fixed good, and the only question is how to distribute it properly.

Fortunately, we already know what system has led to innovation and advancement in the rest of the American economy. It was the free market.

Perhaps we should let it work in health care as well.

Massachusetts Cost Containment

Due to continued rising health care costs in Massachusetts under their "universal" plan, the May 7, 2009 Boston Globe reports that the government plans "another bold healthcare experiment":

State seeks to revamp way doctors, hospitals are paid

...Commission [Special Commission on the Health Care Payment System] members said they will urge Governor Deval Patrick and the Legislature to replace the current system, in which insurers typically pay doctors and hospitals a negotiated fee for each individual procedure or visit, with a set payment for each patient that covers all that person's care for an entire year.

Massachusetts would be the first state to broadly adopt such a system, which would essentially put doctors and hospitals on a budget in an effort to restrain health spending.

A single, yearly fee is intended to discourage doctors and hospitals from providing unneeded tests and treatments, so patients could find it harder to get procedures of questionable benefit. And because doctors and hospitals would have to work together more closely to manage the budget, the hope is they will better coordinate care for patients, which could improve quality.

But Scott Keays correctly noted that this is nothing new in this May 10, 2009 LTE to the Boston Globe:

Patients' care would be compromised

Adopting a system to pay doctors and hospitals a single, yearly fee for each patient is neither bold nor experimental. It's just another variation of capitation: a system that would lead to the government rationing and ultimately compromising patient care.

Before making another costly healthcare mistake, Beacon Hill lawmakers should ask themselves how they would react if their doctor said, "We've already spent your annual healthcare allowance, and anything else we could do to treat your condition would put us deeper in the red." My guess is that it would only take one really sick lawmaker (or governor) to realize the error of their ways.

Scott Keays
Allston

Keays is completely correct. This sort of capitation creates a financial incentive for hospitals and physicians to provide the minimum care necessary. So if you come to your doctor with abdominal pain and he has a choice between a more expensive surgery which will cure your condition or less expensive medications that will be less effective, he may choose to delay surgery for as long as possible to avoid losing money on your case.

Can patients trust medical advice in such circumstances, knowing that their doctors are rewarded financially for undertreatment and penalized for recommending more expensive treatments?

Patients hated this sort of indirect rationing during the heydey of HMOs. They won't like it any better when the government does it.

More Waiting in Massachusetts

The cracks continue to widen in the Massachusetts "universal" health care plan. The May 15, 2009 Boston Globe reports that patients are waiting even longer for access to specialists:

Waits to see Hub doctors grow longer

Despite Boston's abundance of top-notch medical specialists, the waits to see dermatologists, obstetrician-gynecologists, and orthopedic surgeons for routine care have grown longer - to as much as a year for the busiest doctors.

A study of five specialties shows that the wait for a nonurgent appointment in the Boston area has increased in the past five years, and now averages 50 days - more than three weeks longer than in any other city studied.

Read the whole thing.

Too many politicians conflate "coverage" with actual medical care. Under "universal" systems, governments can promise plenty of theoretical "coverage", but not actual medical care.

Massachusetts patients know the difference between "coverage" and medical care. So do patients in Hawaii.

Will the rest of the country have to learn this lesson the hard way?

How ObamaCare Will Affect Your Doctor

The May 12, 2009 Wall Street Journal warns that the current push towards government-run health care will squeeze patients and physicians alike, with massive unintended consequences. Here are a few excerpts:

How ObamaCare Will Affect Your Doctor

...Physician income declines will be accompanied by regulations that will make practicing medicine more costly, creating a double whammy of lower revenue and higher practice costs, especially for primary-care doctors who generally operate busy practices and work on thinner margins. For example, doctors will face expenses to deploy pricey electronic prescribing tools and computerized health records that are mandated under the Obama plan. For most doctors these capital costs won't be fully covered by the subsidies provided by the plan.

...Right or wrong, more doctors will close their practices to new patients, especially patients carrying lower paying insurance such as Medicaid. Some doctors will opt out of the system entirely, going "cash only." If too many doctors take this route the government could step in -- as in Canada, for example -- to effectively outlaw private-only medical practice.

Read the whole thing.

The end result will be a total government takeover of medicine.

If you want the US health care system to look like the Department of Motor Vehicles, you won't have to wait long.

Medicare is Unsustainable

John Goodman runs some numbers and shows that Medicare is unsustainable.

There are two important consequences.

1) If we move towards any form of government-run universal health care (such as the proposed "Medicare for all"), the problem will become quickly worse.

2) The government will eventually have to cut health care spending. In other countries, this has taken the form of draconian rationing (e.g., "no dialysis if you're over a certain age"). Basically, the government determines what their citizens' lives are worth.

That's why we need to adopt free market health care reforms as quickly as possible, where the usual market mechanisms can lower costs while preserving quality. We don't have much time to act. All we need is the political will.

Simpson on Licensing

During an online discussion on whether physicians should be forced to work during pandemics as a condition of retaining their medical license, the discussion turned towards the appropriateness of medical licensing in general.

Steve Simpson of the Institute of Justice had the following excellent comments to make in response to some questions. With his permission, I'm reposting his remarks here.

With respect to the question that doctors know up front that they agree to certain terms before they accept a license, hence they've voluntarily contracted to any associated obligations:

First, doctors do not consent to medical licensing in the sense in which that consent could legitimately be said to impose further obligations on them, the way one consents to the obligations in a contract.

Doctors do not get to decide to practice with a license or without a license. They are compelled to practice with a license whether they want to or not. So it is wrong to claim that they somehow consent to whatever obligations come with licensing. The state offers them the "choice" of practicing with a license or not practicing at all. That is not a choice the state has to authority to impose upon doctors, any more than it has the moral authority to offer citizens the "choice" of being enslaved citizens or not being citizens at all. I could say much more about this, but I'll leave it at that.

With respect to the concern that private medical licensing groups would have a conflict of interest between setting high standards vs. retaining their members (and hence government would be better at protecting the public from shady practitioners):

Second, your view that private medical licensing would constitute an inherent conflict of interest because it would be doctors essentially engaging in self-regulation is wrong on many fronts. The fallacy at the root of your view is that individuals are capable of objectively governing the lives of others but not capable of governing their own lives because of their own self interest in the latter situation but not the former. There is much to say to this, and reading Atlas Shrugged would be a good place to start in learning why that view is the exact opposite of the truth, but let me say just a couple things.

You say that there is no guarantee that private medical boards will set high standards or improve them as necessary. But there is, and it's the best guarantee that has ever existed--rational self interest. Doctors are neither insane, nor irrational (indeed, if they were, I submit they would not be doctors now would they). Nor are their patients. Doctors have no desire to harm or injure their patients, for, among other reasons, if they do they will not remain doctors for very long, they will have no patients, they will get sued, etc.

Moreover, there is no guarantee that state regulatory boards will set high standards either. Indeed, state regulatory boards have no incentive whatsoever to keep current with the latest developments in medicine and to ensure that their standards are high. What is the cost to them if they do not do so? They are committees, and thus each individual can always shuffle off the responsiblity for their failures to someone else, and even if they are found to have failed to set high enough standards, they suffer no consequences whatsoever. Their income and careers are not on the line, they will never be fined or sanctioned for their failures, and rarely, if ever, are any regulatory boards ever held accountable for their failures.

But there's another mistake in your thinking about this that many people make, which is to consider any regulatory boards to be separate from the professions they regulate. This is flawed as a matter of both history and common sense. Historically, occupational licensing has typically been championed by the very professionals who are to be licensed. They do this both to "professionalize" their industries--because it is much better to be "state licensed" than simply to be qualified--and to make it much harder for others to compete with them.

As a result, all occupational licensing agencies or boards that exist today are composed of the very professionals that they regulate. This makes perfectly good sense when you consider that no one else is qualified to regulate them. Who is going to decide what the proper standards for doctors are but doctors? Likewise lawyers, plumbers, carpenters, engineers, architects, stenographers, morticians and funeral directors, barbers and cosmetologists, florists, etc. Do you know what standards even a licensed florist or interior decorator must meet to be qualified? I don't. So who, but other florists and interior designers are going to regulate the florists and interior designers?

The term for what I am talking about is "regulatory capture," which simply means that the idea that regulatory boards and agencies of any type are somehow "separate" from the industries they regulate and thus "objective" is utter, unbridled nonsense. It is a pipe dream. It is the sort of thing that we all believed in fourth grade when we thought that committees should run the whole wide world because that would be "fair." My point is not simply that regulatory capture is likely to happen.

My point is that occupational and industrial or economic regulation is virtually impossible without regulatory capture, and, indeed, the regulators actively want the participation of the industries they regulate because otherwise they would not know what the hell they were doing. So your view that regulatory boards are somehow more "objective" and less "conflicted" than private boards is just not true factually and by the very logic of what such regulation aims to do.

And with respect to occupational licensing in general:

I could go on about occupational licensing all day. At IJ, we've done quite a lot of work on the subject, so if anyone is interested in more concrete examples of how licensing evolves in a given profession, check out our website, particularly the economic liberty cases and some of our research publications (www.ij.org). Or just shoot me an email (or ask a question here) and I'll do my best to answer it or direct you to more information.

The idea that licensed workers voluntarily consent to the obligations imposed on them by states is really unjust in more ways than I mentioned. As a lawyer, I see this all the time.

The states in which I'm licensed are constantly imposing new requirements, like mandatory pro bono, additional "continuing legal education" and the like to which I never consented and that are burdensome, costly, almost always a complete waste of time, and useless from the standpoint of improving my qualifications. In fact, what does motivate me to do a good job is precisely the opposite of all of these (and more) unchosen obligations.

I am motivated by the chosen obligations I freely decided to accept when I became a lawyer. My own desire to produce excellent work, to give my client the best work I can, to win my cases or at least to outlitigate the other side at every step, and to constantly produce a better brief or better argument or better analysis than I did the last time out.

But even if those things didn't motivate me, I and every other regulated professional would be motivated by the desire not to be embarrassed or to develop a bad reputation (and I have both colleagues, clients, and judges to worry about) or the other things I mentioned in my last post. In fact, I have never in my 15 year career met anyone who was ever motivated to produce good work by the states in which they were licensed. I could produce consistently incompetent and crappy work for years before any of the three states in which I'm licensed would take notice. My colleagues, my employer, my clients, and all the judges I appear before would take notice long before the state bars.

So my point is that the notion that we voluntarily assume the obligations of our state licenses is both a classic moral inversion--because it is in fact the voluntary obligations that motivate professionals and regulated occupations to produce high quality work--and it is illogical in that it contradicts the supposed purpose of licensing, which is to impose obligations on regulated occupations that they did not choose, because, allegedly, they can't voluntarily regulate themselves. See the contradiction? On the one hand, the obligations of licensing are "voluntary." On the other, licensed occupations can't be self-regulated because "voluntary" regulation would not work. Heads they win, tails we lose.

Thank you, Steve, for this great impromptu analysis!

Here's the full discussion thread, which includes links to additional articles on licensing by Alex Epstein ("End Government Licensing") and Shirley Svorny ("Medical Licensing: An Obstacle to Affordable, Quality Care").

Spaceship Trauma

Yes, there is an ICD-9 code for getting injured onboard a spaceship.

(Via KevinMD.)

Steve Forbes on Health Care

Steve Forbes discusses why we shouldn't look to other countries for health care reform.

Much of what he cites can be found in the NCPA paper, "Health Care Reform: Do Other Countries Have the Answers?" by John C. Goodman, Linda Gorman, Devon Herrick, and Robert M. Sade.

Dalmia Debunks Obama

Shikha Dalmia debunks President Obama's claim that government-run health care will save our economy in this May 5, 2009 piece from Forbes. Here is an excerpt:

Obama's Health Care Reform Tactics

True to the advice of his chief of staff to never let a good crisis go to waste, President Barack Obama is using the current economic crisis to sell a top item on the liberal wish-list: universal health care. "You can't fix the economy," he has repeatedly said, "without fixing health care."

But the president needs to take a chill pill before committing America to a huge new entitlement: One is hard pressed to find any evidence from abroad showing that universal coverage has grown the major industrialized economies more than ours in the past--or shielded them more than us from the global slump now.

...But whatever else universal coverage might bring, there is no evidence that it will bring economic nirvana. If anything, contrary to what the president suggests, the correlation runs the other way for countries with universal coverage such as Canada, England, France, Germany and Japan. On nearly every economic front, their performance has been worse than America's--even, surprisingly, in controlling health care costs.

...All in all, there is no major industrialized economy with universal coverage that has performed as well--let alone better--than the United States in the last decade

(Read the whole thing.)

Admin Note: Light Posting

Due to external obligations, posting will be light next week.

Quote of the Day from Mark Steyn

Canadian writer Mark Steyn has the quote of the day on President Obama's plans for government-run medicine:

Socialized health care in particular changes the nature of the relationship between citizen and state into something closer to junkie and pusher.

And as David Catron notes:

...[O]nce all Americans find themselves dependent on Big Brother for health care, they will do anything to keep the supply flowing. No matter how badly it works, the voters will resist any change.

...That's why the Democrats and our new President want to foist government-run health care on you. They want the kind of power over you that a crack dealer has over a crackhead.

Bill Whittle nails the essential issue here:

"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."

Hsieh OpEd at PJM: "Health Care Reform vs. Universal Health Care"

PajamasMedia.com has just published my latest health care OpEd, "Health Care Reform vs. Universal Health Care".

Here is the opening:

Health Care Reform vs. Universal Health Care

President Obama and Congress have now shifted their attention towards health care reform. This subject is critically important to anyone who might need medical care someday — namely, all Americans. Unfortunately, too many pundits and politicians erroneously equate "health care reform" with government-run "universal health care." Before we rush headlong into any such program, here are three basic facts that Americans should know about universal health care...

The three basic facts I discuss include:

1) Government-run "universal health care" leads to rationing
2) Health care is not a "right"
3) Free-market health care reform can and does work

Read the whole thing here.

McCaughey: Controlling Doctors' Decisions

Former New York lieutenant governor Betsy McCaughey gives us an update on comparative effectiveness mandates and how the will compromise your doctor's ability to practice good medicine.

Here are a few excerpts:

Controlling Doctors' Decisions

...Legislators slipped the framework for top-down government controls into the stimulus package passed in February. One provision called for computer technology that will "guide" doctors' decisions about what care is "cost-effective." Beginning in 2014, Medicare and other federal programs will impose financial penalties on doctors and hospitals who are not "meaningful users" of this system. Private insurers historically have followed Medicare's lead.

...Government controls on health expenditures will reduce the availability of medical technology, such as MRIs, and cause waits for treatment. [Harvard Medical School professor David] Blumenthal says it's "debatable" whether the timely care Americans currently receive is worth the added price.

Ask a cancer patient about waiting, and you'll get a different answer. Delays lower your chance of survival. For example, women in the U.S are more likely to have regular mammograms than are women elsewhere, according to data from the Commonwealth Fund. Their breast cancer is detected sooner. They are also treated faster and have higher survival rates than women in any other developed country, according to the CONCORD study published in 2008 in Lancet Oncology. These statistics include all American women, not just those with insurance.

Read the whole thing.

Advocates of government-run "universal health care" typically criticize insurance companies for denying care in order to save money.

The harm that private insurers can do will pale in comparison to what the government can do when it becomes the the sole monopoly insurer.

Let's hope we don't have to find out.

Four Myths About Universal Coverage

University of Illinois law professor David Hyman has posted a paper entitled, "Employment-Based Health Insurance and Universal Coverage: Four Things People Know That Aren't So".

He covers four commonly-held myths about insurance and universal coverage, including:

* Employers pay for EBC (employment-based coverage)
* There are 45.7 million uninsured Americans
* Universal coverage means everyone will have access to high quality care
* Universal coverage will solve the cost problems of American health care

We do need significant reforms. But his paper explains why government-run "universal health care" will take us in the opposite direction.

And given the fact that the current employment-based system has its roots in bad tax policies, we should eliminate the laws the link employement to insurance, not strengthen them. This would be genuine reform in the right direction.

(For more information on this latter point, see "Healthcare shouldn't be linked to employment" by Jeff Jacoby in the October 19, 2008 Boston Globe.)

Health Care Reform that Will Kill the U.S. Economy

U.S. Senator Tom Coburn (R-OK, and a practicing physician) and Regina E. Herzlinger (Harvard Business School Professor) have written the following OpEd on the perils of Congressional proposals to impose a Massachusetts-style health care system on the entire US. Here are a few excerpts:

Health Care Reform that Will Kill the U.S. Economy

...Massachusetts, which operates a U.S. analogue to a national government-run health-insurance market, is, in fact, a case study illustrating why health insurance run by Washington would collapse on itself. By March 2009, the state's uninsured rate fell to 2.8 percent from about 6 percent. The market, stocked with private-sector insurance policies, had insured 169,000 people in two new programs, one of which directly subsidizes uninsured individuals.

Good news, right? Wrong.

Their piece then describes the rising costs and long waits.

The next step:

By 2009, Massachusetts enacted almost $800 million in new taxes to fund, among other things, the third year of health care reform. Now, the state government, desperate for revenue, is considering setting the prices of health insurance and essentially taking control over all health-care costs, other than Medicare and out-of-pocket spending. If this sounds like a march into a single-payer Soviet-style system, that's because it is.

And the end result:

...In the end, the Democrats' health care reform will require drastic rationing of health care for the sick to control its costs. Consider Canadian patients, who may wait a year or longer to get radiation therapy. Or ask one of the nearly 1.8 million Britons who are waiting to get into a hospital or have an outpatient procedure. Or talk to the German breast cancer patients who are 52 percent more likely to die from the disease than Americans.

We have been warned.

Killing Private Health Insurance

US Rep. Jan Schakowsky (D-IL) has openly stated that the goal of "health care reform" is to kill off the private health insurance sector and replace it with a "single payer" system:



As the sympathetic leftist website People's Weekly World reports:

Rep. Jan Schakowsky (D-Ill.) and co-sponsor of HR-676 answered criticisms from single-payer advocates. She said the public option is not a compromise, but a strategic step toward the single-payer system and the elimination of the private insurance industry.

The private sector is united in opposing any legislation that would expand publicly funded health care over and against the virtual monopoly of insurance companies.

The public option is simply the opening salvo against the private sector, Schakowsky and other speakers said.

(Via Verum Serum and Hot Air.)

Knope: Bernie Madoff for Health Czar

Dr. Steven Knope has penned another OpEd on our current unsustainable system of government-managed health care. Here are some excerpts, but read the whole thing:

Bernie Madoff for Health Czar

...As I mentioned in my first healthcare letter, we do not have the money to pay for our current nationalized healthcare experiments, which we call Medicare and Medicaid. To open yet another financial wound, we do not have the money to fund Social Security over the next 30 years. So before you buy something expensive, it would seem wise to ask if you can afford to maintain it. The unfunded liabilities for Medicare and Medicaid alone have been estimated at $47-trillion dollars. This is the cost of insuring 30-million Americans. We do not have enough money for these existing programs, much less to expand these services to cover the lives of 304 million Americans.

What I am telling you is that Medicare and Medicaid will run out of money. The system will go bankrupt. It will be like AIG, which was "too big to fail", but which has failed despite pouring billions into it. People in my generation, and those younger, are "investing" in a Medicare system which promises to pay big dividends in healthcare dollars during our retirement. However, the politicians running the plan understand that this is a fiscal impossibility. It is dishonest. That money will not be there for us. It will be all used up by the time we reach age 65. The reason is that there will not be enough young workers to fund the Medicare system and keep it going for the aging baby boomers. Does this scenario sound familiar to you? Have you recently read about other people who have set up scams like this? You guessed it. Medicare is a Ponzi scheme.

...So why is a doctor like me engaging in "politics" or going on a rant about the healthcare dollar? Because money is a necessary part of the discussion! When you try to buy something on a credit plan that you can't afford, it is only a matter of time before that something is repossessed. Before we scrap private healthcare and open another credit card for nationalized healthcare, we should think about what we will do when we can't afford the payments. The answer is that people won't get the medical care they need, which is what happens in Canada. In all seriousness, I'd start putting away some extra cash in the bank for the day when Bernie Madoff or his sons reject your request for an MRI of the brain. You'll need that extra money to travel to Dubai for your MRI or your knee replacement - to purchase quality healthcare in a free-market system that is not dominated by a government rationing panel.

(Read the rest here.)

For more advice from Dr. Knope on how protect yourself from the upcoming fiasco of "universal" Obama-Care, read this post.

Slowing The Push Towards Fast-Tracking

Democrats in Congress are getting close to a deal which would allow them to "fast track" their plans for government-run "universal health care".

As former US Senator John Sununu notes in the April 27, 2009 Wall Street Journal, this would allow a bare miniumum of senators to impose "National Health Care With 51 Votes".

Part of the Congress' apparent urgency on this issue is that they may believe that momentum is slipping away from them unless they strike quickly. The Tea Party protests have galvanized many Americans against further government takeovers of the economy. And David Catron notes that public support is shrinking for "universal health care".

And as we've noted, most Americans are pretty happy with their current health care. But they are legitimately concerned about rising costs. And they've also been led (or misled) to believe that everyone else is having problems (thus justifying more government intervention).

All of these signs indicate that free market reforms might receive a fair hearing -- if Congress decides that it wants to take a deep breath, not rush headlong into creating any new massive government programs, and have a open honest discussion about the kinds of reforms we actually need to correct our current problems.

Americans have already been burnt by the Congressional rush to pass the "stimulus" bill -- which many legislators now acknowledge that they didn't even read before voting for it. Congress should not make the same mistake by rushing to pass "universal health care" legislation.

Our friend Hannah Krenning and my wife Diana Hsieh have sent the following letters to our Colorado Senators Michael Bennet and Mark Udall:

Dear Senators Bennet and Udall,

I have read the recent Reuters article and want to register my vehement objection to this underhanded approach to the debate on health care. I do not want government involvement in my health care decisions. I want a free-market approach to medicine.

Creating new government tentacles to surround my physical well-being and doing so in a way that "rams" it through (Reuters words, not mine) betrays the unprecedented power-lust present in Washington these days. Your participation in this "deal" would be a gross betrayal of your constituents and the Constitution. I hope you will find the conscience and backbone to resist participation.
Sincerely,

Hannah Krening
Larkspur, Colorado


Dear Senators,

I am writing to express my dismay over the prospect that some kind of socialized medicine (like mandatory, universal coverage insurance) will be imposed on America by "fast-tracking" health care reform. It is grossly irresponsible for the legislature to take such drastic action without proper debate and discussion. We've already seen too many frantic attempts to do something quick -- anything, no matter how irresponsible -- over the past few months. It's time for the legislature to slow down -- preferably before you grind the economy to a halt.

You might have won an election, but you have no right to dispose of anyone else's life, health, and wealth. For you to attempt to ram socialized medicine down our throats -- without so much as offering Americans the chance to form and express their opinions on the matter -- is morally wrong. It's also a sign that your position is weak -- that you cannot persuade Americans of the merits of your views by any rational appeal to facts. Indeed, you have reason to worry: socialized medicine in any form is always disaster.

I do not want any government involvement in my health care. I do not wish my life and health to be subject to the whims of government bureaucrats. I support the elimination of the whole horrid web of entitlements and controls that are strangling medicine while driving up costs. The free market has not failed: your government controls have failed. Repeal them -- and restore the doctor-patient relationship to its properly private sphere.

Diana Hsieh
Sedalia, CO

(Disclaimer: FIRM is non-partisan and does not support either the Democratic or Republican parties. FIRM does support free market health care reforms.)

Goodman: A Prescription for American Health Care

The March 2009 issue of Imprimis features an article by John Goodman on the future of American health care. The economic picture he paints is pretty bleak.

Here is an excerpt:

A Prescription for American Health Care

...Social Security and Medicare have been spending more than they are taking in for quite some time. As the Baby Boomers start retiring, this deficit is going to grow dramatically. In 2012, only three years from now, Social Security and Medicare will need one out of every ten general income tax dollars to make up for their combined deficits. By 2020 -- just eleven years down the road -- the federal government will need one out of every four income tax dollars to pay for these programs. By 2030, the midpoint of the Baby Boomer retirement years, it will require one of every two income tax dollars. So it is clear that the federal government will be forced either to scale back everything else it's doing in a drastic way or raise taxes dramatically.

Any form of "universal health care" will merely worsen these problems and lead to draconian rationing.

Fortunately, he also describes some free market solutions that would address these problems.

We still have time to act. The big question is whether we will have the political will to do so.

(Disclaimer: With respect to one of the solutions Goodman discusses, I do believe we should allow people to use Health Savings Accounts to pay for their future health care expenses. However, Goodman's piece is slightly ambiguous as to whether he believes this use of HSAs should be voluntary or mandatory. I believe this should be voluntary, and I hope Goodman would agree.)

Gratzer on Socialism and Cancer

David Gratzer, MD, discusses some of the flawed comparisons between health care in the US and other countries in this essay from the Winter 2009 issue of The New Atlantic, "Socialism and Cancer".

Here are a few excerpts:

...In a 2000 assessment of the world’s health systems, the World Health Organization (WHO) ranked the U.S. system thirty-seventh -- lower than even that of Colombia. In Sicko, Michael Moore’s 2007 documentary comparing health care systems, the U.S. system is portrayed as broken and cruel. A Commonwealth Fund study published in early 2008 surveyed nineteen nations in terms of preventable death and ranked the United States last.

This unrelenting stream of negativity has shaped the debate over U.S. health care reform. Consumers are souring on U.S. health care; policymakers are weighing the political and economic costs of changes to the system; and, according to one recent poll, even doctors—historically the most vocal opponents of socialized medicine—now support the idea of government-run health care.

...Ask yourself a simple question: If your daughter had a bad cough, would you call your pediatrician -- or get her on a flight to Bogota, Colombia?

While international comparisons make for good headlines and moving speeches -- Democrats, in particular, like to cite the WHO findings on the stump -- these studies are frequently quite limited and flawed. Most of the work is either highly ideological (Michael Moore's cannot withstand a basic fact-check) or confuses health with health care (the Commonwealth Fund study reflects the fact that Americans smoke more and exercise less than citizens in many other Western countries). The WHO study -- intolerant of any patient-borne expenses, heavily rewarding "equity," and focusing on smoking rates and other public health measures—suffers from both these problems of ideology and confusion. That is how it could reach the conclusion that America's health care lags behind Colombia's -- a conclusion no patient or doctor would second with his feet. (And indeed, even the WHO study had to concede that the American health care system was more responsive to citizens' expectations than any other nation's system.)

Gratzer correctly argues that one should analyze how well a country's health system does once people actually become ill, and he uses cancer diagnosis and treatment as one measure, because we have good comparative data on this set of diseases:

Of course, there is more to health care than a response to one disease -- yet, with the focus of so many governments on cancer care, with the common nature of this illness, and with the excellent statistics available, it's fair to use it as a proxy for health care performance. How does the United States fare? Excellently, two major studies suggest.

...Looking at specific cancers yields striking results: For men, the bladder cancer survival rate in the United States is 15 percent higher than the European average. With prostate cancer, the gap is even larger: 28 percent. For American women, the uterine cancer survival rate is 5 percent higher than the European average; for breast cancer, it is 14 percent higher. The United States has survival rates of 90 percent or higher for five cancers (skin melanoma, breast, prostate, thyroid, and testicular), but there is only one cancer for which the European survival rate reaches 90 percent (testicular). Lung cancer, once considered a death sentence, now has better survival rates over five years -- and Americans do better than Europeans, 16 percent versus 11 percent.

He also discusses some of the controversy over prostate cancer statistics.

He then discusses the reasons for these differences:

Why then is the United States better in overall survival? There are several contributing factors. Certainly the ability of cancer patients to get access to new medicines is helpful.

...And socialized health care systems don't just lag on cancer drugs -- new technologies, too, are less available. The problem is well illustrated by the story of Deb Maskens, a mother of two young children who suffers from kidney cancer...

Government-managed and -funded health care systems are not simply averse to new drugs and technologies. These systems are often plagued by rationing through waiting. People wait for diagnostic tests and specialist consults, delays that allow cancers to grow and spread. The diagnostic gap is well documented...

And he offers some concluding thoughts:

Government-run health care systems control costs by rationing care. In contrast, for all its flaws, the American health care system does not hesitate to spend, eager to embrace new technologies and treatments. And that’s why Americans do so much better.

...Cancer care in London or Paris may not seem relevant to Americans in Las Vegas or Providence. But in the coming years, Americans will need to think very hard about their health care system. With a Democratic-controlled Congress and White House, the forces are aligned for far greater government involvement. This does not bode well: value in health care -- as in the other five-sixths of the economy -- will come from competition and choice, not a government committee.

...That is why American health care reform demands an American-made solution, one that respects the power of markets and competition instead of putting trust in government bureaucrats.

Overall, he makes many arguments that politicians should heed.

Anyone interested in more discussion along these lines can find it in his book, "The Cure: How Capitalism Can Save American Health Care" (now in paperback.)

Who Should Control Your Health Care?

In his April 20, 2009 essay at PajamasMedia.com, Jeff Emanuel warns about the latest move by the government to wrest control of medical decision making from doctors and patients. Here's an excerpt from his article:

Who Should Control Your Health Care?

Who should have control over your medical care: your family doctor or a bureaucrat you've never met whose sole job is to look out for the government's financial bottom line?

That question is being debated in court right now, as three states are currently seeking a ruling from a federal judge that the final say in an individual's medical treatment lies with the government and not with that patient's doctor...

Read the whole thing.

The state claims that because it is paying for the care, it should have some say in how that money is spent.

If the US proceeds to adopt any sort of government-run universal health care, then this argument will become the norm -- as it already is in Great Britain and Canada.

The inevitable end result will be rationing.

This is just the latest of the many warning signs that Americans have heard about government-run health care. The critical question is whether we'll heed them before it's too late.

Washington Times on Rationing

The April 21, 2009 Washington Times has published their editorial warning about health care rationing under the Obama plan. Here is an excerpt:

Rationing health care

It doesn't matter what your doctor says; the Obama administration plans to decide if you will have cancer treatment or heart surgery.

Appearing on "Meet the Press" on Sunday, Lawrence H. Summers, President Obama's chief economic adviser, stated, "Whether it's tonsillectomies or hysterectomies ... procedures are done three times as frequently [in some parts of the country than others] and there's no benefit in terms of the health of the population. And by doing the right kind of cost-effectiveness, by making the right kinds of investments and protection, some experts ... estimate that we could take as much as $700 billion a year out of our health care system."

Let's be clear - Mr. Summers is talking about rationing...

They correctly note:

Nationalized health care puts bureaucrats - not doctors - in charge of deciding who needs what medical treatment. Rationing is inevitable under these schemes. That's one reason Mr. Obama's universal heath care plans must be stopped.

Admin: Twitter Feed

FIRM now has a Twitter account. I'll see if I can automatically mirror the blog posts onto the Twitter feed.

WSJ: When Doctors Opt Out

The April 17, 2009 Wall Street Journal published an OpEd by Dr. Marc Siegel addressing one of the biggest fallacies in the debate over universal health care, namely the conflation of "coverage" with care.

Here's an excerpt:

When Doctors Opt Out
We already know what government-run health care looks like.

Here's something that has gotten lost in the drive to institute universal health insurance: Health insurance doesn't automatically lead to health care. And with more and more doctors dropping out of one insurance plan or another, especially government plans, there is no guarantee that you will be able to see a physician no matter what coverage you have.

...More and more of my fellow doctors are turning away Medicare patients because of the diminished reimbursements and the growing delay in payments. I've had several new Medicare patients come to my office in the last few months with multiple diseases and long lists of medications simply because their longtime provider -- who they liked -- abruptly stopped taking Medicare. One of the top mammographers in New York City works in my office building, but she no longer accepts Medicare and charges patients more than $300 cash for each procedure. I continue to send my elderly women patients downstairs for the test because she is so good, but no one is happy about paying.

Read the whole thing.

Governments can make all sorts of promises of theoretical "coverage", but that is not the same thing as delivering actual medical care. And as we've seen in countries such as Canada and the UK, the people are all "covered" but they must often wait months for medically necessary care. And in some case, the government simply denies their care.

David Hogberg summarizes this issue nicely in his OpEd in the June 9, 2007 Washington Times:

'Health care,' more or less

...Believing health care and health insurance are the same thing easily leads to some mistaken, if not dangerous, notions. It leads to the beliefs that (1) universal health care and universal health insurance are the same; and (2) that if a nation has universal health insurance, where the government pays for every citizen's health care, that nation will have universal health care, where citizens will have ready access to health care whenever they need it. As the experience of other nations shows, however, universal health insurance often leads to very restricted access to health care.

There's one final danger that also needs to be raised. If doctors continue to opt out of government-run health care, then the next logical step will be to force them to treat patients. This is inevitable logic of the mistaken notion that health care is some sort of a "right".

Rights are freedoms of action (such as the right to free speech), not automatic claims on goods or services that must be produced by others. There is no such thing as a "right" to a car -- or a tonsillectomy.

Instead, people do have the right to seek health care from providers on mutually agreeable terms free from government interference. The government should protect that right.

Whenever government attempts to guarantee an alleged "right" to health care, it can only do so by violating the actual rights of taxpayers (who must pay for that service) and the health care providers (who must work on the governments' terms, rather than on their own terms). And that is what is fundamentally wrong about "universal health care".

Two From Pacific Research Institute

John Graham and the Pacific Research Institute have published two worthwhile health care items recently.

The first is a short paper on the problems with the proposed "government plan", entitled "Government Health Care Competition: The Audacity of Hope Against Experience".

Graham's bullet points include:

• Instead of a new government plan to compete against private health insurers, President Obama needs to remove the barriers that the government currently maintains against individual choice.

• Even the most benign government enterprise, the U.S. Postal Service, cannot compete against private couriers without a monopoly on basic letter delivery.

• By proposing to eliminate Medicare Advantage, a program that allows private insurers to compete for Medicare dollars, President Obama demonstrates that he cannot tolerate private competition against a government program.

The full paper is available here. (Note: In a fully free market, there would be no need for Medicare Advantage, because Medicare would no longer exist.)

The second item was their blog post, "Is Health Care A 'Right'? Not According to Governments Who Run Health Care".

Apparently in Canada, some provincial governments are arguing that health care is not a right, in order to protect its control over state-run medicine and to put providers of private medicine out of business. Here are a few excerpts from their post:

The advocates of government-run medicine base their claims on the notion that health care is a "right." They thus attempt to occupy the moral high ground over those who advocate reforms based on the principle of individual choice.

...[I]n British Columbia, the monopolistic provincial health plan is suing Dr. Day for allegedly receiving direct payment from patients for performing surgeries in his clinic. What makes the case remarkable is that the provincial monopolists have launched their legal attack against Dr. Day based on their new-found conviction that Canadian citizens do not, in fact, have a right to health care.

...As this episode shows, once the state takes over, the citizen hasn't got a chance. Governments are not competent to provide health care as a "right," any more than they would be competent to provide shoes as a "right." Therefore people who define their right to health care differently will have to continue to fight the state to recognize it.

How should it then be defined? When I'm speaking publicly on health reform, people sometimes ask: "Do you think that health care is a human right?" My answer is: "Yes, I believe that you have a right to spend your own money on health care of your choice, free of government interference."

(Read the rest here.)

In my opinion, this latter point is one of the most important issues in the health care debate -- namely that rights are freedoms of action, rather than automatic entitlements to goods and services that must be produced by others.

Fortunately, Dr. Leonard Peikoff makes this case with great eloquence and clarity in his essay, "Health Care Is Not A Right".

Hannan on UK Health Care

Daniel Hannan, a UK Member of the European Parliament, discusses the disaster of universal health care in Great Britain:



(Via David Catron.)

Two NCPA Analyses Worth Reading

The National Center for Policy Analysis (NCPA) has put out a pair of Brief Analyses worth reading. Click through to each one for more information on the topics listed.

Brief No. 651, "Exposing the Myths of Universal Health Coverage"

Myth No. 1: Employer Mandates Would Make Coverage Affordable.
Myth No. 2: Insurance Costs Can Be Limited to 10 Percent of Income.
Myth No. 3: Guaranteed Issue and Community Rating of Premiums Protect Consumers.
Myth No. 4: Expanding Government Insurance Improves Access to Care.

Brief No. 652, "The Folly of Health Insurance Mandates":

Problem: Employer Mandates Are a Tax on Employees.
Problem: Employer Mandates Are Limited by Federal Law.
Problem: Individual Mandates Are Difficult to Enforce.
Problem: Individual Mandates Are Vulnerable to Special Interests.
Problem: Mandated Acceptance Raises Premiums.
Right Solution: A National Insurance Market.

Hard Tax on Soft Drinks?

[In honor of Tax Day, I thought this story was appropriate. -- PSH]

Politicians and would-be do-gooders are continuing to push for massive taxes on soft drinks, according to this story in the April 8, 2009 Science News:

Coming: Hard tax on soft drinks?

In a commentary released today (ahead of print) by the New England Journal of Medicine, Yale's Kelly Brownell and New York City's health commissioner, Thomas Frieden, argue that taxing sugary drinks could go a long way toward putting a brake on obesity. It won't make fat people slim. But it could slow or prevent plump consumers from ballooning into obese individuals, they argue...

Although it maybe unwise to consume too much sugar, note that Brownell and Frieden rely on collectivist arguments to justify government intervention:

Ounces of Prevention -- The Public Policy Case for Taxes on Sugared Beverages

...The contribution of unhealthful diets to health care costs is already high and is increasing -- an estimated $79 billion is spent annually for overweight and obesity alone -- and approximately half of these costs are paid by Medicare and Medicaid, at taxpayers' expense. Diet-related diseases also cost society in terms of decreased work productivity, increased absenteeism, poorer school performance, and reduced fitness on the part of military recruits, among other negative effects.

(Their full NEJM commentary can be read here.)

But as I noted in my January 7, 2009 piece in the Christian Science Monitor, "Universal healthcare and the waistline police":

...Of course healthy diet and exercise are good. But these are issues of personal -- not government -- responsibility. So long as they don't harm others, adults should have the right to eat and drink what they wish – and the corresponding responsibility to enjoy (or suffer) the consequences of their choices. Anyone who makes poor lifestyle choices should pay the price himself or rely on voluntary charity, not demand that the government pay for his choices.

Government attempts to regulate individual lifestyles are based on the claim that they must limit medical costs that would otherwise be a burden on "society." But this issue can arise only in "universal healthcare" systems where taxpayers must pay for everyone's medical expenses.

The growing political push towards universal health care and the related push towards nanny state controls are mutually reinforcing. Americans will soon have to decide who should be in control of their lives and their health -- the individual or the government. It's not just our health at stake, but our basic freedoms.

WSJ on the Public Plan

The April 12, 2009 Wall Street Journal has a good analysis of the implications of the proposed public plan:

The End of Private Health Insurance
When government 'competes,' guess who always wins?

Above every other health-care goal, Democrats this year want to institute a "public option" -- an insurance program financed by taxpayers, managed by government and open to everyone, much like Medicare. This new middle-class entitlement is the most important debate in Congress this year, because it really is the last stand for anything resembling private health insurance.

This public option will supposedly "compete" with private alternatives. As President Obama likes to put it, those who are happy with the insurance they have now can keep it -- and if they happen to prefer the government offering, well, gee whiz, that's the free market at work...

The WSJ identifies one extremely crucial point.

We must not let the advocates of the public plan portray this as any kind of "free market" measure. Instead, it must be explicitly identified for what it is -- government control over a major sector of economy. One can debate whether this sort of statism is more properly called fascism or socialism, but it's definitely not the free market!

The article continues:

...Under the aegis of a level playing field, all private plans will be forced to offer benefit packages similar to those in the public option. They will also be required to accept all comers, regardless of pre-existing conditions, and also be forced to offer similar rates to all enrollees, ending the ability to manage risk through underwriting. Any private plan will essentially become a public utility where government decides what products it must offer and how much it can charge.

Democrats couldn't be clearer on this point. House baron Pete Stark -- who thought HillaryCare was too moderate and has long favored Medicare for all -- said at a recent hearing that currently "We have no mechanism to directly push the private sector to do delivery system reform and address rising costs." But the public option, he added, would force private insurers to "modernize," which seems to be his term for industrial policy.

Read the rest here.

The coming government takeover of health care will make their firing of an automobile CEO seem like small change in comparison.

For additional thoughts, I highly recommend this summary by InsureBlog.

Ponnuru on Universal Coverage

The April 8, 2009 New York Times published an interesting OpEd by Ramesh Ponnuru entitled, "The Misguided Quest for Universal Coverage".

Overall, his economic analysis is good.

He notes that the magnitude of the cost-shifting caused by the uninsured has been greatly overexaggerated and that Massachusetts-style mandated insurance will simply drive up costs to benefit special interests with political "pull".

And he also correctly calls for eliminating the current employer-based system of health insurance (which only exists because of bad government tax policies giving those employer plans unfair preferential treatment.)

He also attempts to address the moral dimension as follows:

The moral case for universal coverage is that we have an obligation to see to it that the poor and the near-poor have access to good health care. But universal coverage is only one way of realizing that goal, and not necessarily the best one. For people with pre-existing health problems, for example, direct subsidies would probably be more efficient than rigging insurance markets to make sure they are covered.

In other words, he doesn't argue the case that one person should not be forced to provide another person's health care because it would be a violation of individual rights. Instead, he apparently grants the statists' premise that there is some legitmate government role in guaranteeing "access".

Although "direct subsidies" might be a good temporary intermediate step towards complete privatization of health care, it should not be part of any permanent free market reform. Instead, those who need health coverage but cannot afford it themselves should rely on private charity, as Dr. Peikoff notes in his essay, "Health Care is Not A Right".

Furthermore, if one wants to really improve access to health care, then eliminating various licensing laws that artificially restrict the supply of health care providers would be a far better approach.

Nonetheless, I'm glad that the New York Times has published Ponnuru's piece. His ideas deserve to be part of the debate.

But it also highlights the need for a more integrated economic and moral defense of free market health care reforms.

Schwartz on Colorado HB 1293

The April 7, 2009 Boulder Daily Camera has published Brian Schwartz's commentary on HB 1293:

Prepare For More Expensive Medical Insurance

The Senate Finance Committee has approved Colorado House Bill 1293. The Denver Post claims that this bill would reduce your insurance premiums. Not so. They will increase.

The Post claims HB 1293 would "increase the number of those covered by government insurance and thereby reduce cost-shifting" from the uninsured and under-insured. Sure, this cost-shifting increases premiums costs. But the cost-shift from those with government insurance far exceeds that from the uninsured.

In Colorado, the cost-shift from the uninsured increases annual premiums by $85 per insured Colorado resident. For the data behind this, search on-line for "uninsured cost-shift scam." Compare this to Medicare and Medicaid: Bloomberg recently reported that "Medicare and Medicaid increase the annual cost of covering a family of four by $1,788." As if the taxes we must pay to fund Medicare and Medicaid weren't enough.

If politicians want more affordable insurance they should repeal prohibitions that make it so expensive. For example, HB 1256 would allow Coloradans to buy insurance available in other states. In four states average annual premiums for individual plans cost $500 less than in Colorado. For family plans the potential savings increases to $1,000 in five states, according to America's Health Insurance Plans.

Government-controlled health care in the U.S. is a disease masquerading as its own cure.

Brian T. Schwartz

Thank you, Brian!

Rhoads on "Comparative Effectiveness Research"

Jared Rhoads, director of the Lucidicus Project, has written another excellent OpEd, this time on the dangers of "comparative effectiveness research". This is an important part of President Obama's intended health care "reform", and is yet another method by which the government will control how physicians practice medicine.

Here is his piece in its entirety, reposted with his permission:

It's not about "effectiveness"
By Jared M. Rhoads

Last month, President Obama signed into law the American Recovery and Reinvestment Act, a piece of legislation intended to stimulate the economy by "laying the groundwork" for recovery with smart investments in infrastructure, jobs, and research. Among the many provisions for healthcare, the act sets aside $1.1 billion for government research to determine which treatments, drugs, and technologies are the most effective in preventing, diagnosing, and treating various conditions and disorders.[1]

From a strictly medical perspective, this type of research is intriguing because the precise risks and benefits of many treatment options are unclear, and often it is not understood why some therapies work for some patients and not for others. But why is this any business of the federal government?

Supporters of the research defend the spending on the grounds that it will help to make programs such as Medicare less wasteful. Comparative effectiveness research, they say, will ensure "responsible stewardship" of the public's funds by allowing the government to pay only for what works.[2] For example, if researchers find that some cheaper alternative works just as well across a population as a more expensive treatment, then the government could change the Medicare reimbursement structure to provide an incentive for the former and a disincentive (or outright penalty) for the latter.

Interestingly, such uses of the research findings are explicitly prohibited in the text of the Act. Section 804 stipulates that the law shall not be construed to permit the Federal Coordinating Council to mandate coverage, reimbursement, or other policies for any public or private payer based on the findings of researchers.

But that will not stop the government. In due time, Congress will strike, amend, ignore, or "provide clarification" such that it will be possible for the government to use these findings to substitute the cheapest possible care for patients, Canadian-style. Guaranteed. After all, if the findings cannot be used to inform policy making, then why bother doing the research at all?

Investing taxpayer money in the name of delivering care more efficiently does not change the fact that there is no rational justification for government involvement in healthcare in the first place. If a man is robbed at gunpoint, does it make any difference how carefully and "effectively" the thief spends the loot?

The purpose of government is to protect rights, not play universal problem-solver for all manners of health and welfare needs. To even discuss the alleged merits of such research is to evade the source of the funds (confiscatory taxes) and lend credibility to those who seek to expand the reach of government into medicine.

Comparative effectiveness research sets the stage for an unprecedented increase in the government's power to control what treatments providers can prescribe and to whom. We already have a mechanism by which to determine and reward best practices: the free market. But unless the market is allowed to operate unhampered and unfettered, we will never escape the cycle of programs breeding programs.

_____

1 H.R. 679; 111th Congress (2009): American Recovery and Reinvestment Act of 2009

2 Paduda, J. "The horrors of effectiveness research" Managed Care Matters. In his article, Paduda writes: "I'm completely disgusted with the hypocrisy of the libertarian right; those who have screamed for years about the ineffectiveness of government, ranting nonstop about how government can't do anything right, yet are now screaming even louder as government attempts to make sure they are responsible stewards of the public's funds."

IBD on the Public Plan

The April 7, 2009 Investors Business Daily has a good OpEd explaining why the proposed "public plan" will kill the private health insurance industry.

Here's an excerpt:

...President Obama and Congress' plan to offer a government health plan would ultimately be a death warrant for private health insurance. The public must be alerted.

The findings this week of the respected Lewin Group health care consulting firm should be chilling to all Americans. "The private insurance industry might just fizzle out altogether," warned John Sheils, chief author of the study, which looked at the effects of setting up federally managed insurance.

Its premiums could be 30% below the average offered by the private market, assuming Medicare payment levels. If eligibility were only extended to small businesses, individuals and the self-employed, as the president promised in last year's campaign, enrollment in that cheaper public option would reach nearly 43 million. Insurance companies would lose 32 million customers.

FIRM is non-partisan, and I am not a Republican. But I agree with this statement from the article:

"It is not a failure of the market, but the ways the market has been distorted largely due to government policies and programs," the House GOP plan states. "They have undermined the doctor-patient relationship and removed the individual patient from the decision-making process... Layering on more government control, regulation, and 'management' cannot address the problem; it will only reduce the alternatives available to individuals and families."

If this "public plan" goes through, then this will be the inevitable end result.

Ralston: Federal Health Board Is Hazardous to Your Health

Richard Ralston, executive director of Americans for Free Choice in Medicine, has written an OpEd on the dangers of the proposed Federal Health Board:

Federal Health Board Is Hazardous to Your Health

By Richard E. Ralston
March 23, 2009

Nearly a century ago, the United States Federal Reserve Bank was established. The stated purpose was to eliminate boom and bust and other fluctuations in the U.S. economy. Federal government control of banking and the money supply was declared to be absolutely necessary to eliminate recessions, panics, depressions, inflation and deflation. Federal Reserve banks were set up in major cities across America under the governance of a Federal Reserve Board in Washington, D.C. It was explained that the Federal Reserve Board would be "independent." All of its "independent" members were appointed by the President with the consent of the Senate (that is, politicians). One wonders what selection process would have made them "dependent."

A century later the Federal Reserve Bank is enshrined as an eternal institution with big staffs and impressive buildings in Washington, D.C. and throughout the country. It appears to be here forever, growing ever more powerful. Politics has never been a factor in the appointment of a board member. The country has been completely free of depressions and recessions. There has never been any inflation. The buying power of our dollars always increases. They are as good as gold. Unemployment has been abolished forever.

Based on this fabulous (i.e., fictional) record, Senator Baucus, former Senator Daschle and others have proposed the creation of a Federal Health Board to govern and ration all medical care in the United States. Such a board, we are told, would be independent from political influence, because its members would be appointed by the President of the United States. It would reduce the cost of medical care and insurance while providing everyone in the United States with all of the medical care they need or want. No new medications approved by the FDA as safe and effective, no new medical devices, no new care facilities or medical and nursing schools will be allowed without the final approval of this board.

Are Americans willing to trust the government with all of their health care requirements? Should we rely on the government to make medical decisions and place our health entirely in the hands of politicians? Should we expect the government to place our needs ahead of powerful hospital groups or public employee unions? Surely we can rely on the government to insure that there are enough medical facilities in our own communities rather than in, say, the district of a powerful committee chairman? Can we expect the Federal Health Board to establish priorities based on the public interest and not their own agendas? Will some diseases become more politically correct than others?

Based on the history of public schools in providing wonderful education to our children—without any trace of ideological indoctrination or politics—shouldn't we ask the government with the help of public employee unions to take over all the medical care of our children? Based on the currently unfunded but rapidly increasing costs of Medicare and Medicaid, shouldn't we trust the government to reduce all medical costs when it takes them over and none of us have anywhere else to go?

Based on its amazingly consistent and ever more competent management of banking and the money supply for one hundred years, should we not immediately take action to create and accept the decisions of a Federal Health Board on each personal detail of our medical care? Do we still really want to allow physicians to decide which drugs to prescribe without first getting permission from the "national health care coordinator"? Based on the spotless record of the Federal Reserve and the flawless performance of public education, what could possibly go wrong with federal control of medicine?

Or should we protect the private patient-physician relationship and the right to manage our own medical care (to the extent those things still exist) and allow investment in as many improved medications and medical devices as possible?

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

Any American who values his or her ability to receive quality medical care in the future should heed his warnings.

It's All About the Control

I wish this were an April 1 joke, but unfortunately it isn't.

CoyoteBlog notes that, "Government health care initiatives are not about cheaper or better care. They are about control, and increased power for government officials."

He cites two stories to illustrate his point. First, via Carpe Diem:

The state is trying to shut down a New York City doctor’s ambitious plan to treat uninsured patients for around $1,000 a year. Dr. John Muney (pictured above) offers his patients everything from mammograms to mole removal at his AMG Medical Group clinics, which operate in all five boroughs. His patients agree to pay $79 a month for a year in return for unlimited office visits with a $10 co-pay.

"I'm trying to help uninsured people here," he said.But his plan landed him in the crosshairs of the state Insurance Department, which ordered him to drop his fixed-rate plan - which it claims is equivalent to an insurance policy. Muney insists it is not insurance because it doesn't cover anything that he can't do in his offices, like complicated surgery. He points out his offices do not operate 24/7 so they can’t function like emergency rooms. The state believes his plan runs afoul of the law because it promises to cover unplanned procedures - like treating a sudden ear infection - under a fixed rate. That's something only a licensed insurance company can do.

"I'm not doing an insurance business," he said. "I'm just providing my services at my place during certain hours." "If they leave me alone, I can serve thousands of patients," he said.

The second story is from the Washington Examiner:

The five plaintiffs, who now include former House Majority leader Dick Armey, are challenging a policy of the Department of Health and Human Services (DHHS) that denies Social Security benefits to anybody who refuses to enroll in Medicare.

Read that again: As the policy now stands, if you want to pay for your own health care rather than let taxpayers finance it through Medicare, government will not let you receive the Social Security benefits for which you have spent a lifetime paying taxes.

Note that nobody is trying to avoid contributing to Medicare. The plaintiffs merely want to decline the tax-funded benefits for which they already have paid. None of them want the bureaucracy, the governmental intrusions into their privacy, and the rationing of care they believe Medicare entails - so they volunteer to let taxpayers off the hook by providing their own health care coverage.

But DHHS won't let them. Or at least not if they want to receive Social Security benefits. Forfeit Medicare, says DHHS, and you must also forfeit Social Security even if you've paid for it for half a century.

In other words, the government is trying its hardest to stop individuals from using their own money to seek their own best interests through voluntary exchanges of goods and services, even if it might save the taxpayers some money.

These government policies show that it is indeed all about the control, rather than some alleged goal of promoting individuals' actual best interests.

Warnings about Obamacare

The Health Policy Consensus Group has been tracking the trends in various proposals for "universal health care" and has issued an important warning about the following elements (PDF version)) which have been floated repeatedly:

• A new government health insurance plan
• An employer "play-or-pay" mandate
• A uniform, government-defined package of benefits
• A mandate that individuals must purchase insurance
• A National Health Insurance Exchange extending federal regulatory powers over private insurance
• Federal interference in the practice of medicine through a federal health board, comparative effectiveness review, and other government intrusions into medical decision-making

Their paper discusses each point in greater detail.

I believe their economic analysis is essentially correct. The American people should know these facts.

If you're opposed to these ideas and wish to support free market health care instead, please sign the Galen petition:

Postrel on the Drug Industry

Virginia Postrel has written two superb articles on the drug industry, the risks they take in drug development, and the dangers we face as a result of government regulations on this vital industry. She also discusses the "universal health care" debate.

The first article is from the March 2009 Atlantic: "My Drug Problem":

If I lived in New Zealand, I'd be dead.

...The American health-care system may be a crazy mess, but it is the prime mover in the global ecology of medical treatment, creating the world’s biggest market for new drugs and devices. Even as we argue about whether or how our health-care system should change, most Americans take for granted our access to the best available cancer treatments—including the one that arguably saved my life.

The second is her response to reader feedback: "Defending 'My Drug Problem'".

I highly recommend reading both articles!

Knope in New York Times

Concierge physician Dr. Steven Knope was featured in this April 2, 2009 article in the New York Times, "Doctors are Opting Out of Medicare". Here are a few excerpts:

...Many people, just as they become eligible for Medicare, discover that the insurance rug has been pulled out from under them. Some doctors -- often internists but also gastroenterologists, gynecologists, psychiatrists and other specialists -- are no longer accepting Medicare, either because they have opted out of the insurance system or they are not accepting new patients with Medicare coverage. The doctors' reasons: reimbursement rates are too low and paperwork too much of a hassle.

In contrast, both patients and physicians win with private "concierge medicine":

...Dr. Knope, the author of "Concierge Medicine: A New System to Get the Best Healthcare," has this kind of practice in Tucson. His patients sign a contract agreeing to pay $6,000 a year for individuals and $10,000 a year for couples. The fee covers office visits, physical exams and phone consultations, and Dr. Knope will meet patients in the emergency room, see them in the hospital and occasionally make house calls.

A list of about 500 concierge doctors throughout the country is available on Dr. Knope's Web site, www.conciergemedicinemd.com.

Is the care worth the money? Harold and Margret Thomas, who are in their mid-70s and live in Cincinnati, spend the winter in Tucson. After many phone calls, the couple were unable to find an internist in Tucson who took new Medicare patients, so they signed with Dr. Knope in 1996. Five years ago, when Mrs. Thomas developed a blinding headache, her husband called the doctor at 8 o'clock one night, and he, suspecting an aneurysm, insisted they get to the emergency room immediately.

The doctor met them and ordered an M.R.I. and a CT scan. The tests revealed an aneurysm, and Dr. Knope found a surgeon who quickly operated. Medicare paid for the emergency room, the surgery and the hospital stay.

"If there were a concierge practice in Cincinnati, I’d be part of it there, too," Harold Thomas said.

This is the benefit when patients and physicians are allowed to contract freely for their mutual self-interest.

Crowder on Canada

In honor of April 1, here's a Steven Crowder video on Canadian health care:



(Via David Catron.)