Free Markets, Free People


Health Care Spending – The Government Is NOT The Answer, It’s The Problem

Morgen Richmond of Big Government points out a story that received very little coverage this week in the media.  It had to do with a report released by the Centers for Medicare and Medicaid Services and its findings.  Apparently, per CMMS, 2008 health care spending (the latest figures available) “slowed” when compared to 2007.  In fact that slowed from 6% growth to 4.4% growth in 2008.

That, one would think, especially as health care reform is the hot topic, is newsworthy.  But one has to believe that the reason it wasn’t found newsworthy has to do with the details of the report.  The reason is that the details don’t support the premise that our health care spending problems lie in the private sector:

Because in a year where the growth rate in overall healthcare spending dropped by an unprecedented amount, federal spending on Medicare and Medicaid actually increased dramatically from the prior year.

Medicare by 8.6% in 2008 compared to 7.1% in 2007, and Medicaid by 8.4% compared to 6.1% in 2007. And Federal spending on the Children’s Health Insurance Program (SCHIP) increased by an even greater amount (13.4%).

In other words, the reduced growth rate in healthcare spending for 2008 was entirely due to reduced spending in the private sector. Which upon reflection really comes as no surprise since the private sector by its very nature must respond and adapt to market dynamics. As long as it has the flexibility to do so, unimpeded by government regulation.

Exactly.

Look again at those numbers. Think about the reduction in private health care spending necessary to offset those increases in federal health care spending to bring the overall number down to 4.4%. Private care and/or insurance are not the problem and giving more power to government is not the solution to lowering health care costs.

Another report that has been mostly ignored points to factors which will most likely see private sector spending continue to decline over the coming years. It is most likely being ignored because the solutions put forward are primarily market based solutions.

Given these facts, you are left to ponder the following question articulated by Richmond:

So a federal government which has never in history demonstrated one iota of ability to reign in spending can permanently add another 40+ million people to federal entitlement programs [and] [t]his is the silver bullet necessary to reduce costs?

Nope. No bullets at all, silver or otherwise. The government is shooting blanks, and a system that is ranked number 1 out of 191 in the world for “responsiveness to the needs and choices of the individual patient” (uh, isn’t that what good medicine is all about?) is about to be downgraded dramatically based on a collection of myths, half-truths and outright lies.

Comforting, isn’t it?

~McQ

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