"Healthcare Ailing"--Star-Ledger Reader Forum

5/14/09

Health care ailing

I awoke recently to a report stating Big Health was going to save the country $2 trillion over the next decade ("Health care industry gets behind Obama's plan," May 11). What a coincidence. Just as the Obama administration begins to tackle heath care reform, a colossal savings has been discovered.

In the late 1980s and early 1990s, medical inflation was running around 10 percent annually. Bill Clinton was elected and immediately proposed health care reform. Surprise! Medical inflation plummeted, only to rebounded just as soon as reform efforts were killed.
Should the government have propped up buggy-whip manufacturers when they became obsolete? Of course not. Although the current patchwork quilt that makes up health care financing in this country is likewise obsolete, competition in this sector still has "efficient" insurers with overheads around 15 percent.

Medicare's overhead is 1 percent. It is time for the nation to catch up with the rest of the civilized world.

John O'Connor, Cedar Grove

Insurance reform needed

I would like to add my voice to those who think that a single-payer insurance plan is the way to go. It's not free health care, but a less expensive, more efficiently run and fairer system.
The current system has failed us, that much is obvious. I'm sorry that the insurance companies are afraid of losing their stranglehold on our health care, but the over 40-million of us who are uninsured and risk bankruptcy are not so sympathetic.

David Easton, Maplewood

My Commentary:

Posted by Zemack on 05/14/09 at 8:43PM

John O'Connor comes close to naming the problem with regard to healthcare financing, then misses the obvious conclusion...end government's massive interference. Leaving aside Obama's $2 trillion extortion scheme against the industry, today's "patchwork quilt" is solely the work of government, which Mr. O'Connor now wants to reward with totalitarian control.

To start with, as Jeffcon points out, the idea that government-run programs like Medicare offer low administrative costs is a mirage. For example, the administrative costs for Medicare are huge, but are simply shifted onto the private sector, such as doctor's offices, hospitals, and employers (in the form of tax collection costs). In addition, the government's own tax collection costs are ignored.

The second thing to grasp is that the government-imposed third-party-payer system, thousands of government insurance mandates, and state-imposed restraints of trade that bar inter-state competition impose huge, unnecessary administrative costs while simultaneously driving up the cost of insurance. America currently spends some $7500 per capita per year ($30,000 per family of four and rising) on healthcare. Almost that entire amount represents third parties spending other people's money. This is a fundamental part of the problem. That money comes from all of us in a myriad of ways, yet leaves us with little control over how it is spent. David Easton doesn't have insurance, but (assuming he is a working taxpayer) pays plenty in healthcare costs...only his money goes to pay for other people's healthcare.

Today's insurance industry is actually a quasi-private, government created and protected cartel, and is not indicative of a free market. The seeming "stranglehold on our health care" held by the insurers is really an extension of government coercion. The single-payer "solution" would consolidate power under a centralized bureaucratic elite armed with the government's legal monopoly on physical force. It would have total, life and death control over providers, patients, treatments, prices, medical technology, etc. To put it in Mr. Easton's language, the government would have a stranglehold on our health care...a real stranglehold called a dictatorship.

Any honest and objective healthcare reform debate must begin with an examination of how we got to this point to begin with. The problems in American healthcare have grown in lock step with the growth of government intervention. The solution is to discover capitalism. The only just and moral course to take on healthcare reform is to rid healthcare of government interference. End all government insurance mandates, barriers to inter-state competition, and the third-party-payer system; phase out existing "public" plans like Medicare, Medicaid, and SCHIP, and let people take personal responsibility for their own healthcare, as is their unalienable right under American principles. Leave healthcare dollars in the hands of the people that earned it through some vehicle like HSAs, leave providers and insurers free to compete directly for those consumer dollars, and restrict the government to its proper role of protector of the individual rights of all (which includes anti-fraud laws and enforcement of contracts). The natural incentives inherent in a free market provide the proper, moral dynamics for affordable, widely available quality healthcare.

Today's problems in medicine represent a failure, not of freedom, but of statist government intervention. The choice we face is not between a government-run healthcare dictatorship and the status quo, as Mr. O'Connor and Mr. Easton would have us believe. The choice we face is between being held in a stranglehold by government central planners, or taking control of our own healthcare in a truly free market.