Advice for Hillary; Bravo for Stossel
Advice for Hillary
Her plan was released today. There are lofty goals, but not many specifics.
Twenty years ago Michael Dukakis campaigned for president with the boast, “I have insured everybody in Massachusetts.” Of course he hadn’t, and two decades later, everybody in Massachusetts is still not insured. Along the way there have been many other plans to create “universal coverage.” They haven’t worked either.
This is why candidates don’t get any points from me for “the thought was there.” Universal coverage at a minimum requires a credible plan. So far, no presidential candidate has come up with one, unless you count Dennis Kucinich’s plan to give health care away for free to everyone.
Here are a few principles politicians tend to overlook.
- Employer mandates don’t work. Hawaii has had an employer mandate for more than 30 years; and the uninsurance rate in Hawaii is higher than in several states that have no mandate. A mandate is a tax on labor. Employers respond by economizing on labor as well as by turning to part time and contract workers. Pay-or-play mandates (insure your employees or pay a fine) have the same effect.
- Individual mandates don’t work. All but three states mandate auto liability insurance. Yet the national uninsurance rate for drivers is only a point or two below the national uninsurance rate for health. Two Canadian provinces require a nominal premium to enroll in Canada’s Medicare. The uninsurance rate in those provinces is in the neighborhood of 4% to 5%.Even if health insurance is absolutely free, mandates are unlikely to work. Up to 14 million people (almost one-third of the uninsured) are eligible for Medicaid or S-CHIP, but have not bothered to enroll.
- A mandated benefit package only makes things worse. Health insurance mandates almost always specify a package of benefits that people must buy. The problem here is the cost of the package is going to grow at twice the rate of people’s incomes. So the mandate will absorb an increasing share of family income or require increasing tax subsidies. Things are made even worse as special interests lobby to include particular services and procedures in the package.A much better alternative to a defined benefit, by the way, is a defined contribution requirement. The government could, for example, require people to spend $X on health insurance or pay $X in taxes, leaving cost control and the content of benefit packages to the market.
- Insurance in name only is not universal care. The most important barrier to care for low-income patients is not lack of insurance or price rationing. It is rationing by waiting. Further, the uninsured and Medicaid and S-CHIP enrollees often get care from the same doctors and the same facilities. Indeed one reason why so many eligible people fail to enroll in government insurance plans is that enrollment often doesn’t expand access to care.
- Pay or play for individuals is not enough. Making individuals pay more in taxes if they are uninsured is not unreasonable. In fact, we do that already under federal income and payroll tax laws. But as Massachusetts is currently finding out, many people will pay the fine and remain uninsured anyway.
- The NCPA’s universal coverage plan is a reasonable solution. Fifteen years ago, Gerry Musgrave and I sorted through all this in Patient Power. Our idea combines all tax and spending subsidies into a single, simple policy. The government offers every person a subsidy of $X. If you buy health insurance, you get the $X as a refundable tax credit. If you are uninsured, the $X goes into a safety net institution in your neighborhood just in case you, and others like you, cannot pay your medical bills. A link to the latest exposition of the plan is below.
Bravo for Stossel
If you didn’t see John Stossel’s 20/20 program Friday night, you missed the best documentary on health care I have ever seen. (Best Scene: in Canada, a dog gets his MRI scan in one hour; people wait six months!) Get the DVD. View it. Share it with friends. Send a copy to our friends at The Commonwealth Fund. And note something about it that is unique.
For the past decade and a half, the orthodox conservative response to Hillary Care has been Hillary Lite. The left says, “The problem is that there is too little health insurance.” The right says, “You are right, that is the problem; we just don’t want as much insurance as you want.”
In Stossel’s program, insurance is neither the main problem, nor the main solution. Instead, the focus is on the market for medical care – on the value of empowering patients and letting providers compete for them.
Cheers
John
For Sen. Clinton’s summary of her own plan, go to: http://www.hillaryclinton.com/feature/healthcareplan/summary.aspx
For the NCPA’s universal coverage plan, see my article on “The Do No Harm Principle to Health Policy”.
To get a DVD of Stossel’s 20/20 program go to: http://abcnews.go.com/2020/Stossel
Excellent comments.
I attended a Cato conference a few years ago on HIPAA. There Dick Armey said:
1-Hillary Care I didn’t get out of committee because Armey’s office circulated a chart depicting what HC I would look like. It resembled about 100 octopi with their tentacles all entangled.
2-HIPAA was one-third of HC I.
Hillary has said she never recommended socialized medicine. I think that is correct. The 1400 pages of HC I are medical FASCISM, in which all the private elements of healthcare are micromanaged from within the beltway–worse than single-payer.
John,
Very helpful. Thanks.
Pat
Kudos to John Stossel!
A Canadian Comments on John Stossel
John Stossel is at the opposite end of the scale to Michael Moore. The truth lies in the middle. Here in Canada a family pays approximately $108 per month for medical coverage on our universal health care plan. Single people pay about $95. Most employers cover the premium cost. Everyone has to pay in to the plan. If you don’t pay in you will eventually be forced to pay the same as if you didn’t pay your taxes. On the plan you never, ever are denied coverage even if you haven’t paid in for years. That’s a seperate issue which the government will handle in it’s own way. You can choose any doctor you wish. You can have more than one doctor. We have walk in clinics where you can go without an appointment. You can go as many times as you like but who would want to? It is not even an issue. Yes we have some long waits for operations. We are working on that and wait times are being reduced. We are starting to move towards a system that we call “semi-private” where you will have the option of paying an extra fee to avoid the wait and get treated in a private clinic. The point I would like to make is that our health care is guaranteed with a universal health care plan. The concept of someone “losing their insurance” is unheard of under this system. Yes, it is subsidized through our taxes but on the other hand we don’t have to pay huge premiums to private insurers. There aren’t any insurance companies making a profit on the system. But to really put it into perspective here are some true to life examples. We were a young couple and my wife had quit work to have our first baby. Then I got laid off of my job. Suddenly we went from two incomes to none. I did find some work right away but it didn’t pay much. Then the baby came. My wife had a private room in the hospital for two or three days. Everything was fine. Then I got a bill from the hospital. It was for $27 for the private room! I gladly paid it. If she hadn’t gotten the private room there wouldn’t have been a bill. One of our sons had to have his tonsils removed. No bill. Another son had to have stitches – no bill.I have had a hernia repaired, a bunion removed from my big toe and some orthescopic knee surgery over the years. No bills. Nada, zip, zilch. My mother, a pensioner was in a rest home and had to be taken to the hospital by ambulance. The bill was $47 for the ambulance; zero for the four day stay in the hospital. I recently got a letter saying that her income had gone up and that she would now have to pay $10 per month for the medical plan. I gladly paid it. A few months later another letter came saying that she had been re-assessed and that her monthly premium would again drop to zero as she was considered to be a low income senior. My mother in law, a pensioner, had to have a pace maker installed. No bill. We have not always had a universal health care plan. It was brought in some time in the sixties after much debate. The concept is that no individual will be denied basic medical care no matter what their station or income. No, it isn’t perfect but it is a good system and you would never find a Canadian who would trade it for anything else.
Interesting. As a Canadian R.N. told me, her father was unable to find a physician in Canada for over a year. In Canada, they are paying $.15 on the dollar in sales taxes for this “free healthcare.” In life, we do not have a concept of “free.” On this earth, everything has a cost, whether it is time or money, a combination of the two, or some other cost. I am on dialysis, you might want to ask a dialysis patient in Canada, how long they have been waiting for a kidney transplant? In socialized medicine, the healthy majority are catered to, while the sick minority is left to suffer. The new technology to help kidney patients is coming from the United States, not Canada. Clemson University is working on a Bioengineered Artifical kidney, which is in the last stage and is expect to be ready and on the market in five years, is there any new kidney research in Canada?
There is a seven pound, 90percent efficient dialysis machine being made by Home Dialysis Plus/Oregon State College of Engineering.
The solution to the cost of health care is not more government programs, it is a free market health care system. In this system, you will choose your physicians and hospital. Then, if you have high health insurance costs, say over $2,000.00 per year, that need would be met by a high deductible policy, which in a free market system, would be cheap. Most people never even come close to needing that type of policy, just a small minority, which I am one. Who should be in charge of your healthcare, you or the government, or the insurance companies? It is estimated that if we eliminated all of the regulations that are encountered by the drug industry, drug prices would be at about 15 percent of what they currently charge for medication. I need a fair amount of medication, I would love to pay only 15 percent of the current cost, sounds good to me.
You have to remember, regulation=cost. With HillaryCare, we will have tons of regulations, so we will have tons of cost! Why should the people that cannot afford to pay for this new bureaucracy, pay for it? You say, they will tax the rich! Well, sadly, there are not enough rich people to fund this mandate, so they will come after the middle class.
Less regulation=less cost, that makes everyone happy.
Mark M.
Cincinnati, Ohio
By the way, everyone, the government and private insurers have overhead.
Mark M.