Obama’s Bad Medicine
There’s no such thing as a free heart transplant
By: Rand Paul
P.J. O’Rourke often says, “You think healthcare’s expensive now? Wait till it’s free!” Whenever the government provides, it must first take away. So those who argue that we can add 46 million uninsured folks to the government rolls and incur no expense are being dishonest or disingenuous at best.
Contrary to what you might have heard in the media, not everyone who opposes Obama’s health care plan is an anti-intellectual rabble-rouser who hates poor people and babies. Eminent economists, physicians, and politicians have all urged the administration to avoid any radical changes before considering long-term effects.
As a doctor, I have seen first-hand what happens when we rush into reform without first diagnosing what truly ails the American healthcare system. In the immediate drive for change we have forgotten to decide what kind of change we want. I believe it should be the kind of change that creates long-term solutions by furthering our basic American principles of ingenuity, self-reliance, and kindness.
So before beginning the health care debate, we ought to ask ourselves one simple question—do our problems stem from too much government involvement or too little?
With over 20 years of experience as a doctor, I can say unequivocally that the problems are not caused by the market but rather by Washington. Thousands of pages of onerous regulation, a bloated bureaucracy, and all sorts of special-interest legislation have driven up the cost of health care to unconscionable levels by preventing free-market forces from operating.
Already over half of medical care is paid for by the government through Medicare and Medicaid—in my practice the number is about 55 percent. I have seen how government runs medicine and the picture is not pretty.
When the government fails to pay physicians, our staff must wait, often over 30 minutes, to speak to a Medicare operator who frequently cannot or will not fix the problem. We waste time only to have the operator dial another operator so we can wait another 30 minutes for them to pick up, and get an entirely different answer. Private enterprise gives us the Red Cross—government gives us Red Tape. Those who favor government-run medicine have never had to place a call to a Medicare bureaucrat.
To get a feel for how Medicare currently works, take this example. As we get older our upper eyelids often droop. If the eyelids obstruct the vision, it is deemed medically necessary, and insurance will pay. However, if you’re on Medicare, you must roll the dice and hope it pays, as they will not pre-approve any treatments.
To want to expand these programs is not only the height of economic insanity, it is morally irresponsible. These people expect something that doesn’t work on a large scale to magically begin functioning on a vastly larger scale. Washington wants to waste money on each individual’s healthcare, but somehow make it up in volume.
Medicare, like Social Security, is demographically unsound. Once upon a time seven workers worked for every retiree. Now it’s just one worker. Add in the Medicare prescription drug plan the future insolvency comes even closer to the here and now. And we are to believe Obamacare is not going to make this fiscal nightmare worse?
There are two general categories of problems with health care: expense and access. With regard to access, we are told there are 46 million uninsured. But who are they?
Of the 46 million who are uninsured, a third of them earn over $50,000, a third are eligible for Medicaid but don’t apply, and 20 percent are in our country illegally. What never gets mentioned is that every single one of them is entitled to emergency and sometimes elective medical care. We are blessed to live in a nation where if someone needs immediate treatment, they will never be turned away from a hospital. The government ought to foster, not deter private charities and churches from providing care.
I treat over 100 patients each year through the Southern Kentucky Lions Eye Clinic. We charge $15 for the exam. We charge this small fee to make it clear that nothing is really free. Medical care costs money—even beyond my labor expenses. Even with socialized medicine, it would still cost money. The problem is that the costs would be hidden and entrepreneurs would not be able to drive them down.
Unfortunately, the current administration has used fear to foist their reform onto the country. Whenever they trot out the 46 million uninsured and grandmas denied coverage, they are using scare tactics to get us to accept radical, irreversible change.
Reality, however, does not comport with their diagnosis. Coverage is not the problem in America—expense is. If costs were driven down year-over-year, as they are in technology, no one would claim we were having a crisis because care would be more affordable and of higher quality. Is it any wonder that costs are rising most in government-controlled areas of medicine—Medicare and Medicaid? This happens because no one pays directly for their health care and prices do not fluctuate with competition like they do in other areas of the economy.
How do we combat the expense? The lack of portability? The fear of insurance premiums going through the roof if you become ill?
Obama would simply mandate away these problems. If we are ready to trade freedom for security, the debate is over. If we still value freedom, we need to dig deeper for solutions.
One solution that alleviates many of the current problems is to make health insurance more like term life insurance.
If I have a heart attack and survive, my term life insurance will not change because I have a 20-year contract. If I have a heart attack and survive, my health insurance will double because I have a one-year plan. Already, my policy is rising at 17 percent per year even with a $5000 deductible.
Ideally, when individuals are young and entering the workplace, we would have policies for them with $1000 to $5000 deductibles. The multiyear plans would gradually increase their deductibles as the years went on. Instead of having monthly payments of $800, individuals might ultimately have yearly payments of $800.
The policies would be individualized and not associated with employment, therefore portable, and if you became sick the insurance company could not raise your rates because you would have a long-term contract in place.
Solutions aimed at lowering prices include creating incentives for higher deductible policies, direct payment to physicians, and freely floating prices. In my practice, I see what market-forces can do for expanding coverage. The two items that patients pay for directly with cash—contact lenses and LASIK surgery—have seen prices fall every year for over ten years. Competition works, especially in medicine.
It is well known that socialism leads to long lines, rationing, and a lack of choice. But more importantly, socialized medicine stifles innovation. We might not have the best coverage in this country (as a result of government intervention), but we do have the best health care. That is because we are the only country that rewards innovation on the market place. The answer therefore is more and not less freedom.
With the above principles in mind, we will look at real healthcare reform—the kind of reform that creates lasting prosperity for everyone…not merely those whom the government deems worthy of care.
To begin with, we ought to level the playing field between individuals and employers when it comes to tax deductions. By extending tax deductions to employer-provided insurance, but not individual insurance, Washington has driven a wedge between the buyer and the seller and added a middleman. This wouldn’t make sense in any other area of the economy, so why does it make sense here?
Building on the theme of things that don’t work anywhere else but that the government expects to work in health care: we have to look at restrictions about where we can purchase insurance. We ought to lift all restrictions on insurance companies competing across state lines. If a person should be allowed to buy a car or clothing in another state, then they ought to be able to buy health care.
There are two ways of organizing an economy. Either we can have a government medical board determine who receives what or we can have the market allocate health care. While it may be tempting to say that the government should correct inequalities, this is not the path to prosperity. In countries with socialized medicine, they are arguing over who gets the biggest piece of the pie—in America we try to bake more. In England, they have defined the exact amount each individual is worth in the last six months of their life, the equivalent of about $27,000 for medicine. If your chemotherapy exceeds, that number you are deemed not worthy enough for treatment.
I don’t think Americans will tolerate such a system.
Rand Paul is an eye surgeon in Bowling Green, Kentucky and a candidate for the U.S. Senate.