Health Care – Who is Scaring Who?

stevemanatt —  7.29.2009 — 9 Comments

I’ve been stewing over the constant dribble over health care reform coming out of Washington and I’ve had enough. It is time for us all to snap out of the trance, put the Kool-Aid down and get our heads into the game. What set it off for me is this excerpt from an e-mail sent by the Whitehouse.

“Over the next month there is going to be an avalanche of misinformation and scare tactics from those seeking to perpetuate the status quo. But we know the cost of doing nothing is too high. Health care costs will double over the next decade, millions more will become uninsured, and state and local governments will go bankrupt.”

There are several things to take now of here, so let’s dive right in (hang with me – it’s a bit wordy).

  1. I don’t think anyone – no matter what political party or affiliation – is asking for the status quo to be perpetuated. Health insurance costs too much and is, consequently, harder and harder to get (and keep in some cases). This should alarm us, but the source of that alarm is what is in question. The Whitehouse and Congress want you to believe that nothing can be done about the “cost” of  medical treatment and the trouble lies in the insurance companies. I’m here to tell you that is a bold-faced lie. Insurance companies are like any other for-profit company. They have a fiduciary responsibility to their stakeholders to stay solvent – i.e. make a profit. As such, they hold to the same supply/demand macro-economic principles everyone else in a capitalistic society does, which is to say that if their costs go up, their retail prices go up.
  2. “Health care costs will double over the next decade.” – I’m sure someone has looked at trending from the past several decades and can project the doubling of health care costs over the next 10 years, but in no way should we believe it to be gospel. Nobody can tell the future and to word this in this way only serves one purpose – to scare you into thinking that this has to be dealt with sooner rather than later.
  3. If that weren’t enough, to say with certainty that millions more will be uninsured and the eventual consequence is bankrupt state and local governments is OUT OF LINE. In the last 233 years, there has NEVER been a bankrupt government. Do you know why? Because they all have the ability to raise taxes or adjust budgets. Don’t buy this – it isn’t true and the sky isn’t falling.

Back to the real reason you are still reading – the real story. Creating a government-run, tax-funded insurance option doesn’t address the costs, but it does do something else that should make you take notice – it adds competition to the market that is not only unfair, it is un-American. Capitalism demands that competition be part of the mix for fairness and equality TO PROTECT THE CONSUMER. Without competition, we have monopolies, and monopolies are bad for us – remember the telecom breakup of the ’80s?

If the Federal Government can “set” the cost of coverage without regard to natural market pressures (profit & loss largely), they in essence become a monopoly and the rest of the market has no way to compete and therefore no way to survive. The President knows this. Congress knows this. It is what they are counting on. They don’t want private insurance companies to survive because they desire more control over our lives – in part, to justify their own position and to further the agenda of big government, higher taxes and more control.

Taking this to the logical conclusion – without alternatives to the government-run option, we end up like Canada and the UK…there simply isn’t a way to avoid it because the real problem isn’t being addressed, which is the high costs associated with medical services. If the President and Congress wanted to fix the health care problem in America, they would have started there – as it is the most logical place to start. If health care costs are PROJECTED to double over the next decade, are we helpless to prevent that? I think not.

What are the contributing factors to the rise in the COSTS of medical services?

  • Advancement in technology | This is a natural (and good) progression. Better technology should eventually lower health care costs as it helps to diagnose faster and more accurately as well as speed the treatment/healing process. We want this to continue and I think we all are willing to pay for it, but what if research hospitals can’t fund research because the government is controlling their profits? You know the answer…
  • Malpractice insurance | The courts have done this country a huge disservice in providing a place to attract medical lawsuits. The millions upon millions awarded to those cases are paid via malpractice insurance. And because insurance companies are subject to profit/loss pressures, they must consequently raise the rate for said insurance. The doctor has no choice but to pay the increased premiums and consequently passes that along to you and me in his/her rate.Limit the amounts awarded in medical malpractice suits and the premiums come back down and so will the rates – all a natural consequence of competition in the marketplace. This is known as tort reform.
  • Uninsured care | Nobody is denied emergency care in America. Again, something we can almost all agree that is good WHEN RESERVED FOR AMERICAN CITIZENS. A large portion of the costs for uninsured care comes from illegal aliens (I use the term on purpose) as they can’t get insurance BECAUSE THEY ARE ILLEGALLY IN THE COUNTRY. So, this cost is linked to another failure of our government – border security and immigration law enforcement. The hospitals therefore are forced to pass those costs on to those that actually pay the bills, which hits the insurance companies first and so on and so on…

I’m sure there are others as I’m not an expert in the field – my degree is in Physics and I design websites for a living, but even I see bad things ahead.

So what are we to do? First, tell your representatives and senators to slow down. Health care reform is a HUGE issue and should not be taken lightly and needs much debate and investigation. We didn’t get into this mess in a week, and we won’t get out of in a week. In fact, how about we focus on the economy and then tackle this issue? We must not let present-day circumstances force us into thinking that we can’t wait. We can – we have – we must.

9 responses to Health Care – Who is Scaring Who?

  1. Well said, Steve!

    Very thoughtful and articulate.

    I would LOVE it if someone with an opposing view would comment on this post and at the same time respond to your assessments. It seems every time I enter into or overhear a conversation on health care, one person will make statements such as yours and the other person will respond with “Well, we’ve got to do SOMETHING” or “What about all the little kids without insurance?” without actually contributing to the conversation.

    And by the way, I LOVE little kids! And if yours is sick and you don’t have insurance, take them to Children’s Hospital. Trust me. They’re covered. 🙂

  2. Robert Johnson 7.29.2009 at 4:46 PM

    Nice post!

    One thing that would change everything overnight and save billions of dollars is a simple change to the law. If the loser of every lawsuit had to pay the legal expenses for the winner, we would get rid of frivolous lawsuits in a New York minute!

    This “Loser Pays” system would put an end to all the bogus and frivolous lawsuits that are filed everyday and cost all of us billions of dollars in additional costs. Doctors spend huge amounts on malpractice insurance and those costs are passed on to everyone in the form of higher costs for health care.

  3. Solid Mr. Manatt, very solid. May also want to add to forces involved in high cost of health care a source that I have not seen much discussed but is quite important: a lack of consumer options in health coverage because of already existing government controls on health insurance. States currently require all health plans to provide coverage for literally hundreds (in some states thousands) of things which a consumer may or may not want coverage for.

    For example the ability to pay for routine check ups out of pocket instead of having it in my plan would drive down the cost of my premium and allow me to use my health dollars when and how I want to. Required coverage of procedures and services most consumers could choose to handle individually out of pocket does nothing except for make me pay for others’ heath procedures which may or may not ever be used or desired by the others I am insured with in any health plan.

    Less government more market! You are the man.

    Rory

  4. Great Post Steve! We certainly don’t want the government running our health care. Insurance costs for the health care providers, unnecessary tests and medications, all driven by threat of lawsuits to the doctors are driving the costs up.

    We have become a litigant society. always looking for who can be blamed (sued) whenever life doesn’t work out the way we expected. I have watched parents teach this to children… classic was hearing a parent blame the bike when a kid stopped pedaling and fell over.

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