Once again, nationalized health care has become a hot topic and, given the current shift of power in Washington, it has a strong chance of gaining traction. WHY is this such a controversial issue and should the government become the primary provider of health care services?
I’ll cut to the chase: it is just another opportunity for government (read: politicians) to make a huge grab for more power and control… and it comes at the expense of individuals. As always, though, proposals are couched in claims based on half-truths, assumptions, and a purposeful effort to shift our attention away from the real problems. Once again, I’ll assert that government doesn’t really want to solve problems, it just wants to APPEAR to solve problems.
So, where do we start?
- Should we have a national health care system?
My answer is NO. Where in the Constitution would the federal government find the authority to do so?
It seems there are many citizens as well as elected officials who believe government can do anything it wants and casually overlook the confines of power laid out in our Constitution. Somehow, the “equal opportunity” we are all guaranteed has morphed into “equal outcome”. I blame much of this on lying politicians (surprise!) and our education system (but that is another discussion).
- Has government EVER been successful delivering a “consumer service” more efficiently than the private sector?
I’ve asked this question many times and have yet to find a good example that can be used to support an argument that government, even if it had the right to do so, is even capable of providing services more efficiently than “the market”.
We’re not talking about providing national military, police, or court services, of course… those are beyond the scope of this discussion and government does have a place in those arenas.
While more intimate, health care is just a consumer service… one skilled individual (doctor, nurse, or other practitioner) providing personal services to another individual (you or me, as a patient). The process isn’t all that different from working with a real estate agent, financial adviser, attorney, or even an auto mechanic… we chose the person we feel is most qualified for our needs, whom we are comfortable with and trust, and who is willing to provide services at a price we’re willing to pay. If they do a good job, it’s a win-win… and if they don’t, the results could be devastating.
Does the government have a right to be involved in that relationship? Should the government determine who I can work with, what they can charge, the scope of services they can provide, the amount of time they can spend with me?
- Is there actually a problem with the health care system that needs to be “fixed” in the first place?
Yes, there are problems. Is nationalizing the system the ONLY way to solve them? Absolutely not! In fact, I believe it is the most heavy-handed approach that could be considered.
An aside: It’s worthwhile to keep in mind that INSURANCE of any kind is not intended to pay regular, ongoing costs… it is designed to pay for EXTRAORDINARY COSTS.
Auto insurance, for example, doesn’t cover gas and oil… nor the 20,000 mile maintenance of your car. Those are regular expenses that you pay. The insurance covers BIG expenses that MIGHT come up if something out of the mainstream happens, such as an accident. Most people can afford to pay for gas and oil, or to replace an alternator, if it goes out… but would have difficulty coming up with $10,000 to pay the unplanned expense of a major collision repair or $25,000 for the medical expenses of the passenger who was hurt in that accident.
Consider some of the fundamental REAL issues and see if nationalization seems like the best solution (or if it even addresses the actual problem!):
- PORTABILITY - one of the big problems is that, unlike in previous generations, employees frequently change jobs during their earning years. There was a time when people would go to work for a company and retire from that same company… but that rarely happens any more. We have learned to market our skills better, seek greater opportunities in wider geographic locales, and take advantage of the freedom we have to change jobs as we please - or to go into business for ourselves.
But changing jobs often affects our insurance coverage. Why?
Once again, we discover that government itself caused the problem! Years ago, Congress manipulated the tax code to make insurance coverage a deductible employee expense for companies… but not for individuals. This means that companies can offer to pay, say, $100 of an employee’s cost of participating in the company insurance plan (which is a relationship between the employer and the insurance company) and it is not counted as taxable compensation for the employee. That’s a good deal for the worker SO LONG AS THEY ARE EMPLOYED at that company. And, since Congress did not give us, as individuals, the same tax advantage, we must pay for insurance in AFTER TAX dollars if we want to buy insurance on our own (directly from the insurance company).
This financial advantage is what led to where we are today: most health insurance is provided THROUGH the employer. An unintended consequence of Congress skewing it that way is, if we change jobs, we must qualify for the new company’s insurance plan… which might not happen if I have a pre-existing condition (heart problem, diabetes, whatever…).
Logically, the relationship really should be between the insurance company and me… it shouldn’t matter where I work or if I change jobs… and even if I do change jobs, I don’t have to qualify for the new employer’s plan, I already have my own insurance.
THIS is an easy problem to solve… just change the tax code. People don’t necessarily WANT to buy insurance through their employer, it just makes better financial sense. We get “more for our money”. If the “playing field” were level, people know it would be to their advantage to buy insurance directly since they could “take it with them” where ever they worked.
- UNINSURABILITY - if I don’t have insurance and want to buy it, I must qualify. No insurance company wants to be obligated to cover the medical expenses of someone who has a pre-existing condition… this is called adverse selection. It is clearly not in the insurance company’s interest to provide coverage for someone who is significantly more likely to incur expenses than an “average” person. Or, if they do provide coverage, they will certainly want to charge more than for an average person. This is just the reality of the situation.
The exact same thing occurs in with auto insurance. I’m a very good driver (no tickets or accidents) so I get very good rates… far better than someone who has been at fault in an accident and has several speeding tickets or a DUI, for example. As it should be. The high risk driver pays more than the good driver, if they can get insurance at all.
In most states, since auto insurance is REQUIRED, there is a particular problem to be addressed. Insurance companies can charge different rates based on the driver’s background but, at some point, they simply do not want to provide the insurance. The driver has been in too many accidents or whatever… but the state requires insurance. In this situation, the states have created a “bad risk” insurance pool where all the insurance companies that operate in the state must provide coverage for the “really bad” drivers who must buy through this “pool”. So, drivers CAN get insurance but have to pay dearly for it and the insurance companies spread the risk evenly between themselves, so no single company is carrying an undue burden (financial risk).
For those who cannot buy their own insurance due to pre-existing conditions, it seems one “government solution” would be to require insurance company participation in a similar health insurance high-risk pool? Why does government want to revamp the ENTIRE system to address an issue that actually affects only a fraction of the people?
If you listen to the politicians, you hear some WILD numbers spouted about the “uninsured”. We must be careful, though, that we aren’t being misled.
While there is some small portion of the population who are truly uninsured… who WANT insurance and CANNOT GET it because of a pre-existing condition… but MANY of those who are categorized as uninsured are:
– in between jobs and, as a result, don’t have insurance coverage TEMPORARILY. We have a very mobile work force and, at any given time, a large number of people are in transition. Statistically, these people get counted as “uninsured” but, in fact, obtain coverage once they enter the work force again. Is this a problem that needs a national health care problem to resolve? Of course not! Once again, how about making it more attractive for people to have a direct relationship with their insurance company, as described above, so they will retain their insurance company during the periods they are changing jobs?
– have simply decided not to pay for insurance. Many people, especially YOUNGER people, fall into this category. It is THEIR CHOICE not to bear the expense of health insurance. Undoubtedly, there is some portion of this group who feel they cannot afford it… choose to pay for rent or a car instead of insurance… but MANY in this group CAN AFFORD to pay, but just don’t want to! They decide it is a “better value” for them to buy cable TV, ipods, and other luxuries. Besides, most in this group are aware that, if they need medical care, they can simply go to a local publicly-funded hospital and get treatment… and not be forced to pay. These people have learned to “play the system”… to get something for nothing. Is the government going to FORCE EVERYONE to buy the “national insurance”? How does a national health insurance program address this aspect of the problem?
- RISING COSTS - there is no question that health care costs have increased, as have all costs of living, but at a higher rate. Some of this is due to the many advances in technology, diagnostic and treatment tools that help provide better and faster medical services (something we all want) but at a price. This would seem a normal progression of events, though. Almost all industries have seen big strides in this area.
One big part of those rising costs, however, revolves around the dramatic increase in legal activity: malpractice suits. Lawyers have learned there is “easy money” in the medical field! And empathetic courts have allowed this activity to not only continue, but to spiral out of control. In addition, doctors now routinely order unnecessary tests and treatments as a defensive measure to try to keep lawyers from being able to point out some deficiency in their handling of a patient’s problems.
The government needs to seriously eliminate these abuses and, while we get lip service from Congress, there has been no serious effort toward tort reform. Will nationalized health care address this issue? I think not… and it has every likelihood of being the foundation for even greater abuse if the government might be the ultimate payer of big judgments.
There ARE other aspects of this issue, of course, but these are some of the major ones. I conclude that the nationalized health care ideas being discussed today do not really focus on some of the fundamental issues and, as a result, will fail to resolve anything. Instead, a huge government bureaucracy will be created, expenses will continue to rise, the system will be ripe for abuse and fraud, the true problems will persist, and politicians will have more power over our daily lives.
Politicians are just performing like magicians again, making us look at one direction while purposely manipulating things in the other. For the very few in our country who might come out ahead under proposed programs, the vast majority of us will pay a greater price in terms of money, quality of service, government control, and individual freedom.
Can you think of any DEFINITIVE examples supported by comprehensive, non-political analyses demonstrating the case that government, without a doubt, can deliver consumer services more efficiently than the private sector?
No rhetoric, no baseless claims. Facts.
(I have yet to find one.)