Posted by
Crescen7(Regis Matejcik) on Thursday, August 13, 2009 8:40:45 AM
As Americans we enjoy the benefits of
the worlds finest medical technology and distributive services. We also
endure the burden of a medical system, that due to a number of
factors, including the economic reality that it is a limited resource
with a virtually unlimited demand, is very costly. In many polls,
Americans indicate that they prefer “Universal” health care.
Unfortunately, it is likely that what respondents are wanting is the finest of medical
technology and service, with the only change being that it be free of
cost. It is imperative that we recognize that Americans
overwhelmingly approve of the quality and availability of our current health care system - but object to the cost.
Democrats want the public to believe
that under their proposal health care will remain unchanged, except
the Government will make it universally available and free – or almost free.
Such an outcome is, however an economic
impossibility. A resource cannot be made universally available at no
cost without altering the supply of the resource in some form or
another. The expected result of making any resource that is in high
demand available at little or no cost; is that the resource will
quickly be depleted and it's distribution governed by some kind of
arbitrary rationing, or the quality of the resource will degrade, or a
combination thereof.
Therefore, a conservative alternative
“health care reform” position must focus on the cost of
health care. More specifically, a conservative alternative must
focus on the current regulatory and legislative framework that has
artificially played a large role in inflating the cost of health care
and
insurance. It is imperative that we understand the fundamentals of the
economics that drive health care. At the very core is a demand that is
growing faster than the supply. Much of the increase in demand can be
traced back to Government intervention via legislation and regulation.
For example, when the Federal Government instituted a "Prescription
Drug" program for the elderly - the demand for prescription drugs was
proportionately increased. When the Sovereign Government becomes a
major purchaser of health care, all other potential purchasers tend to
be diminsished. The Sovereign has the ability to print money, and to
take money from others by force. Therefore, with it's almost unlimited
purchasing power, it can drive the cost of any good or service
dramatically higher by "outbidding" all others for that service. It is
therefore not so much that the Medical infrastructure of the United
States need reform - but the regulatory and legislative controls that
govern the system that need reform.
When we speak of “health care reform”
we need to emphasize that what needs to be reformed are these regulatory
frameworks that govern health care. The currently proposed Democrat
legislation moves in exactly the wrong direction. The current crisis
in health care cost is largely driven by an ever increasing demand
for service due to well intended, but poorly implemented public
policy. Legislative and regulatory trends have been to place
increasingly costly mandates on hospitals, doctors, and insurers,
while making no provisions for funding such mandates. For example, insurance
companies are mandated to include coverage of alcoholism in 45
states. That is, even if one is a devout Mormon that never expects
to have a drink, a pro-rata share of the cost of alcoholism treatment
will be included in ones insurance premium. Some other examples
include invitro-fertilization (13 states) and contraceptives (31
states). The unintended consequences of well intended health care
regulations have left us with a system that produces miraculous
innovation at what are often unacceptably high cost.
The current system displays both the
creative genius of capitalism and the stifling costs born of
excessive governmental meddling. The Democrats seek to cure the
excessive meddling with more meddling – but with the promise that
this time it will be done correctly. They wish for the Federal
Government to openly “compete” for private sector customers with
the insurance industry.
If there is to be any respect for
private enterprise, government entities cannot, should not, must not,
compete with the private sector. Private and public endeavors should
be complimentary – not adversarial. The concept that the sovereign
taxing authority would "compete" with a private industry is at its core
antithetical to the concept of private enterprise. Imagine the
absurdity. Private insurers who must make a profit to survive and
accumulate the capital needed to cover the risks that they insure;
would be paying large taxes on these profits, so they might be used by
the entity that is "competing" with them for business. For generations
this country as forbidden Public entry into private markets. Should
the direction of "health care reform" continue to move in the direction
of "increasing" rather than "decreasing" wrong headed governmental
intrusion into this market; the problems we now face will become
exasperated rather than diminished.
The
proper direction of an alternative "health care reform" position is not
to "soften" or "weaken" the currently proposed legislation. The proper
direction is to provide a clear concise alternative that begins to
"walk back" the disastrous interventionist policies that have lead us
to the current health care difficulties. To do so, there are four
major cost inflating factors that must be addressed. It is in
addressing these factors that we will begin to correct the deficiencies
that burden the current system. Since it seems no major movement or
legislative initiative can survive without an acronym, we'll call this
initiative T.H.E.M.
-Tort Reform
-HSA (health savings accounts) should be tax exempt and eligible for direct medical cost,
deductibles, and insurance premiums
-Emergency Care - definitions and limitations
-
Mandate Reform
While
this writer is not a health care professional, rest assured that
neither is Barack Obama or Nancy Pelosi. The following observations
are based on decades of experience as a consumer and critic of the
current system, as well as countless hours of research and listening to
doctors, nurses, patients, insurance providers, hospital administrators
and employees when addressing the deficiencies of our current system.
The above four items repeated recur as "villains" in discussions or
research regarding health care costs. Often other commonly mentioned
"villains" are merely a subset of one of the THEM.
Summarizing them Briefly:
Tort Reform
-Perhaps
the easiest to understand. Medical practitioners routinely practice
"defensive" medicine by ordering tests and investigating things that
they no are extremely unlikely to yield any results - but don't want to
be accused of negligence for not doing so. The financial impact of
such practices is difficult to over-estimate. Tort reform has been
relatively successful in Texas. The Texas tort reform was
predominantly based on limiting jury awards for "pain and suffering."
While this is a step in the right direction, it may be even more
beneficial to more clearly define and limit "negligence." In medicine,
as well as in much of our litigious society, drawing an incorrect
inference based on sound medical reasoning is treated as being
negligent. The medical industry has been tasked with perfection as a
norm, and anything less than perfection is regarded as fertile ground
for potentially massive damages. In any event, limitations on the
excesses of the "jackpot justice" system that has grown out of the
current medical/insurance industry is an absolute necessity if
effective cost containment is to be achieved.
HSA's (Health Savings Accounts)
-This
idea has been around for a while. It's a good idea, but rather
ineffective unless the other three parts of the initiative are
implemented. That is because it's only effective if people are
actually going to be paying directly for their own health care
expenses, and no one is going to do that unless the cost expectations
become reasonable. For example, let's say that an average family can
sock away $200.00 a month for an HSA. That would be fine if they could
find a decent major medical plan for the family for $150.00 a month,
and they could use their HSA savings to pay either premiums,
deductibles, co-payments or direct medical payments. Under the current
system, however, there is no such option; subsequently there is no
widespread clamor for HSA's. Obviously, if only a mandate laden
insurance plan is available at $400 + a month, and a simple unexpected
two - three day hospital stay costs about $30,000.00 - who the hell
cares if they can save $2,400.00 tax free for a year?
Emergency Care - Define and Limit
-As identified in Drill Down blog (at drilldown.townhall.com)
"Our current public system is based around the EMTALA act of 1986. In short, "The Emergency Medical Treatment and Active Labor Act (42 U.S.C. § 1395dd, EMTALA) is a United States Act of Congress passed in 1986 as part of the Consolidated Omnibus Budget Reconciliation Act. It requires hospitals and ambulance services to provide care to anyone needing emergency treatment regardless of citizenship, legal status or ability to pay. There are no reimbursement provisions."
Because "emergency care" was never defined in the bill, it has become
almost universally interpreted to include anyone, with any ailment, who
sits their butt down in an emergency room. This has become the default
health care resource for the indigent and lower middle class
uninsured. Typical "emergency" treatments range from massive trauma to
sore throats. All are treated, some are insured, some pay, many
don't. The costs are arbitrarily munged by the hospital to whatever
paying entity they believe they can convince to absorb the costs.
Unless the Congress is going to repeal this act, it is imperative that
it be treated similar to a "defined benefit plan" for people lucky
enough to reside in the U.S. That is, Congress must go through a list
of defined procedures, either include or exclude them, and stipulate
the amount of money the Federal Government will reimburse Hospitals for
these procedures. Additionally, it would be helpful if "emergency
care" then became the distinct domain of the Federal Government - with
no private coverage competing for payment of "emergency care." The
effect would be to dramatically reduce the premiums of individual
hospitalization policies. This would also largely deal with the
"illegal alien" health care problem. If minor infirmities are not
treated in the emergency room as "emergencies" at no cost to the
infirmed, illegals will magically find their way to minor medical
centers and magically dig up $50 or $75 for some antibiotics. (On a
purely political note - this could be trumpeted by the left as
"universal" and a political victory.)
-
Mandate Reform
This
issue was alluded to previously. It might be considered the
"deregulation" of health care insurance. More appropriately, it should
be considered the "return to market driven" health insurance. Medical
care mandates have become so onerous that there is almost no consumer
choice involved in hospitalization insurance. Both special interests
and well meaning legislators have placed so many requirements on
insurers that it is a virtual impossibility to create or market a
competitive medical insurance product. If, a healthy 20 or 30
something could purchase private medical coverage that excluded
emergency care (that's covered above), excluded auto accidents (covered
under auto) with a $5,000 deductible (covered in a couple of years of
HSA contributions) it would probably cost them less than $50 a month,
and it would probably be profitable for the insurer.
Would a
healthy 20 - 30 something actually do that ? Sure, if they had the
choice to opt out of their employee plan and take home an additional
$300 a month. The employer would probably also save $100 a month.
Of
course the currently proposed legislation tilts in exactly the opposite
direction. The Democrat solution is to further mandate that insurers
must cover those that are already sick. Excuse me, that's not
insurance. Insurance is the act of assuming a small certain loss,
while eliminating the risk of a large but unlikely loss. The insurer
assumes the risk of the unlikely loss by aggregating the value of a
large number of people that agree to pay the small but certain loss.
The Democrat proposal isn't insurance, its either welfare or charity.
To mandate that insurance providers become welfare agencies or charity
organizations will only guarantee one thing. There will be fewer and
fewer insurance companies. Eventually only one - the
U.S.
Currently there is no "Yin / Yang" to this debate. The legislative initiative has been ALL "Yin" by the Democrats. The
Republican response to the "Yin" so far has been "mini Yin" That
won't do it. The Democrat assault on personal liberty, freedom, and
private property needs to be countered with more than a "not so much"
statement. It is a "Yin" that must be countered with a "Yang". This
is the "Yang" position. The solution is not a takeover of Health Care
by the
U.S. - the solution is
T.H.E.M.