Free Markets, Free People

single payer


And then there’s the crony capitalism angle to the contraception mandate

Peter Schweizer points out:

Forget for a minute the religious question and look at who wins big here: Big Pharma. This mandate is not really about condoms or generic versions of “the pill,” which are available free or cheap in lots of places. This is about brand-name birth control drugs and other devices that some consumers swear off because they are too expensive. The Health and Human Services (HHS) mandate requires health-insurance companies provide contraceptive coverage for all “FDA approved contraceptive methods.” It does not insist on generics. And it does not offer any cost containment.

What’s more, the mandate prevents health-insurance companies from having copays or deductibles for the benefit. This is the perfect set up for Big Pharma. Since the drugs will be paid for by a third party (insurance companies, who will pass the cost on to employers and the rest of us), the consumer won’t worry about the price. Expensive brand names will no doubt see demand rise. Ask more health-care analysts why the cost of medical services continues to rise so rapidly and near the top of the list is the fact that a third-party payment system won’t contain costs.

Need Big Pharma on your side in healthcare mandate struggle?  Looking for a way to put private health insurance companies out of business (or have them abandon the market)?  This is a great way to help that along.  I imagine there are other things to mandate for “free” as well, if you can get this one to stick (and have Big Pharma on your side and not screaming about it, after all, you didn’t say they had to give their stuff away for “free”).

By the way, when you finally have your way with the insurance industry and see private insurance companies get out of the healthcare insurance business, you’ll no longer need Big Pharma, will you?

When you finally have a single payer system and that single payer is government, then you will decide what will be paid for drugs and medicines, won’t you?  After all, who are they going to sell their stuff too if not the single payer?  Innovation and new drugs?  Hey, they’re overhyped.  And anyway, people who live longer cost health care providers (uh, that would be government) money.

It’s like the red kangaroo Dale talks about.  You can see this convergence coming from a mile off, but seemingly we can’t (or won’t) do a thing about it.

~McQ

Twitter: @McQandO


The looming health care bomb – a scenario

As we stand by and wait for the ObamaCare law to take effect, enthusiasm within the medical profession seems to be waning (even more) as that time nears:

In late December, a survey of 501 physicians was released by the Deloitte Center for Health Solutions research group, whose parent company serves clients in the health care industry. Nearly half (48%) expected health reform to hurt their incomes this year, while 73% said it would not reduce costs.

Though this isn’t a scientific survey, and other such surveys have and will show physicians’ support for the Affordable Care Act, the early glimpse of the law’s potential impact will likely lead to economic pain for doctors and a diminished system for their patients. Indeed, the Deloitte survey found that 69% of the physicians are "pessimistic about the future of medicine" because of the law.

It may not be scientific, but it certainly seems indicative of attitudes in the medical profession.  I mentioned one example of what was shaping this sort of an opinion in an earlier post.

Here’s another little factoid one might find interesting that tells a bit of a story too:

An online survey in September by the Jackson & Coker physician recruitment firm — based on 1,611 doctors who chose to respond — reflected that the majority of doctors don’t believe that the AMA represents their views. The primary reason: the AMA’s support of the legislation. Just 13% of those surveyed backed the Affordable Care Act.

As you recall, the American Medical Association came out in favor of the law.

There’s an unintended consequence from all of this (some would argue it’s intended):

The Association of American Medical Colleges estimates that the USA will be 160,000 physicians short by 2025 (when all patients would be insured under ObamaCare), and this is without even considering those doctors who will limit their practice to insured patients because of decreasing reimbursements or who retire early when faced with increasing costs with little return.

Of course the reason to mention that perhaps the consequences are intended is to point out that this still isn’t the single payer system that those who passed the legislation preferred. 

So one has to wonder, how does an ideologue take the lemon of ObamaCare and make it into the socialist lemonade of a government run single-payer system.  Well what exists in the form of ObamaCare is certainly a good step one, isn’t it?

It will be so unsatisfactory that one supposes there will be a terrible outcry.  With fewer health care workers, care will get worse, not better (to my knowledge the population of the country is still expanding, not contracting).  That’s a simple fact that is irrefutable.

Depending on who is in power in DC, government will present itself as the savior to this awful “market failure”.    And the usual suspects will dutifully echo and expand on how the market has again let us all down.  The result of this will be the final elimination of private insurance as an option for most and the expansion of government control in the guise of the left’s much desired single-payer system

Of course, to make that work, the conscription of all health care workers as government employees. 

Nirvana achieved?

That scenario isn’t as far fetched as some would like to believe or contend.  Obviously, the court fight that’s going on right now will have some say in how or if the scenario develops that way.  However, assuming the law is upheld for the sake of argument, and having observed the way the political world works for decades, I think the scenario is quite plausible.

And of course, single payer will be a disaster.   Why?  Because as Medicare continually proves, bureaucrats think they know more than doctors and certainly more than patients.

For instance:

There is widespread support, in Congress and among economists, for the broad ideal that Medicare would save money if it paid for better outcomes instead of more procedures. But 20 years of trying to shift the program in that direction have yielded little to no progress, CBO said Wednesday.

CBO analyzed six programs designed to improve care coordination for patients with chronic diseases. They either made no difference or were actually more expensive than the traditional payment system.

That’s because, as noted in the link I cited earlier to the previous post, the bureaucrats refuse to revise their system of payment based on what would best serve the patient.  And it isn’t a far stretch to believe the same system would be extant in any single-payer plan.  Politicians and economists come and go, but bureaucracies live forever.

So the bomb sits out there ticking away.  If it is allowed to explode, it will destroy health care as we know it today and most likely impose an even more debilitated form of Medicare on all.  Yes, most seniors say they like Medicare – do they have a choice?  Would they like to see an even less capable form of it exist?  Just ask them.

In the meantime remember – Freedom equals choice.  Whenever choices are limited so is your liberty.  When government gets in the business of limiting your choices it is no longer in the business of ensuring your liberty.   And limiting your choices in all sorts of areas, to include health care, is exactly the business our government is in today.

Another, in a long line of reasons, to retire the current occupant of the White House in November.

~McQ

Twitter: @McQandO


Ezra Klein: A larger welfare state might mean a smaller deficit

Honestly, that’s his premise.  You can read it here.  He bases his argument mostly in health care costs.  Obviously where he tries to go with it is toward a single payer system.  But he uses Germany as the model.  Anyone, does Germany have a single payer system?  No, it has a public health insurance program that covers 88% of the population.

Take Germany. They have a pretty big welfare state: pensions, health care, paid vacations, unemployment benefits equal to two-thirds of one’s income.

So that’s great and per Klein, who, like I said, wants you to believe by his vague general description, that Germany has a system like … Canada.

Don’t believe it?  Well it takes that sort of implication to make a statement like this:

To bring this across the Atlantic, you could argue that the United States’s debt burden is the product of an insufficiently large welfare state — at least with regard to health care. To see a stark illustration of that thesis, head to the Web site of the Organization of Economic Cooperation and Development and download their health-care statistics for Canada and the United States [emphasis mine].

Notice how apparently we transitioned seamlessly from a country with health insurance to a country with a single payer system without that being obvious?  In reality we’ve looked at the apple, now he plans on comparing it to the orange:

As recently as 1965, the cost of those two systems competed neck-and-neck. That year, Canada spent 5.9 percent of its GDP on health care. The United States spent 5.7 percent. But around that time, Canada was transitioning to its current single-payer system. Over the next four decades, the growth of health-care costs slowed in Canada while it accelerated in the United States. By 2009, Canada was spending 11 percent of its GDP on health care — and covering everyone. The United States was spending 17.4 percent of its GDP and leaving 45 million uninsured. In dollar terms, we’re spending $3,600 more per person, per year, than Canada.

Emphasis mine.  It’s a pretty ballsy attempt, I’ve got to say.  Here’s another question for those paying attention.  Can anyone tell me what began in 1965?  Anyone?  That’s right … Medicare.  Per Klein, we were actually spending less than Canada until the same year that Medicare and government intrusion into the health care market was made law.

Based on that extraordinarily flawed bit of reasoning which managed to factor out or ignore a major reason for the increase in US health care costs, Klein concludes:

If the United States had Canada’s health-care system, and Canada’s per capita health-care costs, we would have a much “larger” welfare state, but we wouldn’t have a deficit problem.

Really?  Seriously?  You really want to run with that one, Mr. Klein?

Perhaps a less rosy look at Canada might help temper that nonsense a bit. Here’s a Canadian economic analyst speaking about the Canadian healthcare system:

"There’s got to be some change to the status quo whether it happens in three years or 10 years," said Derek Burleton, senior economist at Toronto-Dominion Bank.

"We can’t continually see health spending growing above and beyond the growth rate in the economy because, at some point, it means crowding out of all the other government services.

"At some stage we’re going to hit a breaking point."

It means crowding out other government services or what? 

That’s right, deficits.

Well, except in Ezra Klein’s magic welfare state where one can happily spend whatever they want and there are no apparent consequences or … deficits.

~McQ

Twitter: @McQandO


Health care reform – on to step 2

Harry Reid sent a letter to Sen. Bernie Sanders saying he planned to introduce the public option in a month or so.  Democrats in the House aren’t waiting that long.  Again, assuming they know that their liberal agenda window is closing, “progressives” plan to get the most bang for their buck:

A leader of the House liberals’ caucus said Monday she’ll introduce new legislation to revive the public option.

Rep. Lynn Woolsey (D-Calif.), the co-chairwoman of the Congressional Progressive Caucus, said she plans to unveil legislation to add the government-run option to the national healthcare exchange established by legislation President Barack Obama is to sign tomorrow.

“We will introduce a robust public option bill on the very day the president signs the reconciliation bill into law,” Woolsey said Monday during an interview on MSNBC.

The public option, of course, is the precursor to single-payer and the progressive caucus has never been shy of telling anyone who will listen that’s what they want for real health care reform – a government run insurance program.

Meanwhile states are beginning to line up to file suit over the current bill which passed the House Sunday night – 11 or 12 states, including TX, FL and VA, plan on filing lawsuits upon the signing of the bill into law. FL, for instance, is claiming two elements of the bill are unconstitutional:

McCollum said the challenge is on two constitutional grounds: 1) its mandate that everyone must buy health care insurance, and 2) the new law challenges the sovereignty of states by forcing them to do things they cannot afford. He said the 10th Amendment protects states from that.

“It goes far beyond an unfunded mandate and would literally cost the state of Florida alone billions of dollars in additional costs to be able to implement,” McCollum said. “The whole bill is unconstitutional that it manipulates the state into doing things it cannot afford.”

If the individual mandate were to be ruled unconstitutional – and I think there’s a good chance there – it would cripple the law. One of the main funding provisions has to do with the mandates and fines for those who don’t comply. Of course if the court were to find for the states based on the 10th amendment argument (something I have no idea whether it has sound legal footing or not given the number of mandates the states presently have), the law would push all the cost back on the federal government and destroy any argument, however absurd, that it will reduce the deficit.

The point? The HCR debate is far from over. The left is going to continue to push for more and more add-ons to work toward their real goal – single payer, government run health care. The right is going to have to fight on two fronts – in the Congress where the 41st Senate vote will be very important and in the courts.

~McQ


Harry Reid promises to bring Public Option to a vote in the next few months

Huzzah!

No, not really – but I’m sure that’s the reaction on much of the “progressive” left.  Most of them figure without a public option the chance of actually swinging a government single payer system is a whole lot harder.   With it, they have a pretty good chance.  Harry Reid promises to oblige:

Hoping to assuage progressive Democrats who remain disappointed with the content of the health care reform bill, Senate Majority Leader Harry Reid (D-Nev.) committed on Friday to holding a separate vote on a public option in the coming months.

In a letter to two of his more progressive colleagues in the Senate — Jeff Merkley of Oregon and Bernie Sanders of Vermont — the Nevada Democrat implicitly apologized for his inability to get a government-run insurance plan into the final piece of health care legislation and promised to keep working to get the policy into law.

And don’t expect Mr. Reid to follow the rules of the Senate when he does – oh, no, that day is over apparently (well, except when his party is in the minority again – the caterwauling will be epic).

The search now is for a vehicle outside health care reform to get a public plan into law. The same institutional hurdles that killed the provision in the previous go-rounds — mainly that there aren’t 60 supportive senators to break a filibuster — remain. But aides on the Hill are already looking to future reconciliation vehicles to which they can attach the public plan, which would, in turn, allow for it to pass via an up-or-down vote

Welcome to the world’s largest Banana Republic.

~McQ


Those Who Refuse To Learn From History …

As the president gears up for a new push to pass health care insurance reform with a “major speech” to a joint session of Congress this coming Wednesday, it’s always instructive to peek in periodically at a system that is the practical end state he’s claimed he’s always wanted – the single payer system.

Today, as usual, we take a look at the National Health Service in the UK.

In a letter to The Daily Telegraph, a group of experts who care for the terminally ill claim that some patients are being wrongly judged as close to death.

Under NHS guidance introduced across England to help doctors and medical staff deal with dying patients, they can then have fluid and drugs withdrawn and many are put on continuous sedation until they pass away.

What’s the criticism of the insurance industry? That a bureaucrat somewhere is making a life or death decision, correct? Of course that’s precisely the same thing that happens in a single-payer system, except it is a government bureaucrat making the decision.

In an insurance system, what are your choices? Appeal. Or tell them to stuff it and pay for the care yourself. But in such a system it is highly unlikely that any insurance company is going to try to issue “guidance” to doctors telling medical staff how to deal with dying patients like what the NHS has done. They wouldn’t presume to do it (and if they did, the option is to find an insurance carrier that doesn’t).

However, when it’s a single payer system and, as in the case of the UK, everyone works for government, such as the UK, then such guidance is completely within reason given the system. After all the basic presumption of such a system is that, in fact, bureaucrats do have a right to call the shots.

The scheme, called the Liverpool Care Pathway (LCP), was designed to reduce patient suffering in their final hours.

Developed by Marie Curie, the cancer charity, in a Liverpool hospice it was initially developed for cancer patients but now includes other life threatening conditions.

It was recommended as a model by the National Institute for Health and Clinical Excellence (Nice), the Government’s health scrutiny body, in 2004

And there is no appeal as there’s really no one else to whom you can go.

A number of doctors there are concerned about the guidance. Dr Peter Hargreaves, a consultant in Palliative Medicine at St Luke’s cancer centre in Guildford, is one of them:

He added that some patients were being “wrongly” put on the pathway, which created a “self-fulfilling prophecy” that they would die.

He said: “I have been practising palliative medicine for more than 20 years and I am getting more concerned about this “death pathway” that is coming in.

It is supposed to let people die with dignity but it can become a self-fulfilling prophecy.

“Patients who are allowed to become dehydrated and then become confused can be wrongly put on this pathway.”

He added: “What they are trying to do is stop people being overtreated as they are dying.

“It is a very laudable idea. But the concern is that it is tick box medicine that stops people thinking.”

He said that he had personally taken patients off the pathway who went on to live for “significant” amounts of time and warned that many doctors were not checking the progress of patients enough to notice improvement in their condition.

The key of course, and the reason for the “pathway” is contained in the second sentence I’ve put in bold – “overtreated”. Code for spending money on someone in the last stages of life. Obviously, it is much cheaper to put them in a drug induced coma and let them die than it is to attempt to keep them alive. Hargreaves sees that as a “self-fulfilling” process, where patients who would actually respond to more care and live “significant” amounts of time longer are condemned to death in an uncaring system more concerned about cost than life.

From the beginning one of the primary targets of health care insurance reform has been cost. The claim is that government can help lower those costs. The further claim is it can do it by introducing “competition” into the system. But there’s little in the proposals that anyone can find that actually does that. Instead it appears to most that things like the “public option” are actually designed to move us toward the eventuality of a single-payer system. The NHS provides us almost weekly examples of the cost containment strategies it implements in which extending life takes second place to cutting cost.

If cutting cost is the top priority of a system, any system, those are the types of decisions someone is going to be making. Most likely, if the patient isn’t involved in paying for the service, it isn’t going to be the patient or his family making them. It is going to be some bureaucrat with a budget line busily engaged in the priority of “cutting cost” making the decision.

~McQ


Health Care – “The Public Plan”

Ezra Klein discusses what has commonly become known as the “public plan” in the emerging “health care reform” legislation. Put simply it is “public insurance” which is supposed to compete with the private insurance industry and, as Paul Krugman claims, keep them “honest”.

Klein lays out the various flavors being floated out there concerning this option:

• The “Trigger” Plan: Olympia Snowe is pushing this compromise, as are some conservative Democrats. The basic idea is that the public plan would act as an invisible threat: It would be “triggered” into existence if the private insurance market was unable to offer, say, enough options in a particular region, or enough cost control. In addition, the public plan would only come into existence in this or that region, or this or that state. It would be effectively useless as an insurer. It could potentially have some competitive effect in that private insurers would still work to avoid its existence. Some have argued, however, that the conditions being mentioned in the “trigger” proposals have already been met.

• The Weak Public Plan: This is what people are talking about when they refer to a “level-playing field.” This incarnation of the public plan — first proposed by Len Nichols at the New America Foundation and later echoed by Peter Harbage and Karen Davenport at the Center for American Progress — would have no special advantages over private insurers. It couldn’t use the low rates that Medicare sets or access taxpayer subsidies. It couldn’t force its way into networks. It would simply be another insurer, albeit with different incentives than traditional insurers.

• The Strong Public Plan: This would be like Medicare for the rest of us. It could throw the federal government’s weight around. It could negotiate deep discounts with providers. It could muscle its way into networks. Outside groups like the Commonwealth Fund estimate that it would save the average consumer 20 percent to 30 percent. That would give it a massive competitive advantage over private insurers, and would probably result in tens of millions of Americans dropping their current coverage and entering the public plan to save money. A variant of this was in the draft of Ted Kennedy’s bill that was leaked last week.

While Blue Dog Democrats have come out in favor of the “trigger” option, liberals such as Klein and Krugman prefer the “Strong Public Plan” for the reasons stated (massive dropping of private insurance for “public” (i.e. government) insurance). And there’s a reason they both prefer that – they see it as a backdoor way to move health insurance to a single payer system.

And that is a distinct possibility with both the “strong public plan”. In fact it is a design feature. The “competition” touted would most likely be in name only as Greg Mankiw explains (quoting Krugman to set up his explanation):

What’s still not settled, however, is whether regulation will be supplemented by competition, in the form of a public plan that Americans can buy into as an alternative to private insurance.Now nobody is proposing that Americans be forced to get their insurance from the government. The “public option,” if it materializes, will be just that — an option Americans can choose. And the reason for providing this option was clearly laid out in Mr. Obama’s letter: It will give Americans “a better range of choices, make the health care market more competitive, and keep the insurance companies honest.”

It seems to me that this passage, like most discussion of the issue, leaves out the answer to the key question: Would the public plan have access to taxpayer funds unavailable to private plans?

If the answer is yes, then the public plan would not offer honest competition to private plans. The taxpayer subsidies would tilt the playing field in favor of the public plan. In this case, the whole idea of a public option seems to be a disingenuous route toward a single-payer system, which many on the left favor but recognize is a political nonstarter.

If the answer is no, then the public plan would need to stand on its own financially and, in essence, would be a private nonprofit plan. But then what’s the point? If advocates of a public plan want to start a nonprofit company offering health insurance on better terms than existing insurance companies, nothing is stopping them from doing so right now. There is free entry into the market for health insurance. If a public plan without taxpayer support would succeed, so would a nonprofit insurance company. The fundamental viability of the enterprise does not depend on whether the employees are called “nonprofit administrators” or “civil servants.”

The bottom line: If the goal is honest competition in the provision of health insurance, the public option cannot do much good but can potentially do much harm.

That is a critical point in this debate – there isn’t an insurer out there that has as deep pockets as the US Treasury. If there is public money backing the public option, then the talk of “competition” is a sham. It is being used to placate and fool those who oppose a government takeover of insurance, the result which would surely happen if what Mankiw’s concerns are true. And if you follow the reasoning process that Mankiw has laid out above, it should be pretty darn obvious what the intent of this “public plan” really is, all the happy talk Klein and Krugman throw out there notwithstanding.

Last, but not least, while the “strong public plan” is an obvious short-cut to single-payer government run health care, the other two plans simply delay that same eventual outcome for a while. While there are certainly reforms that could be made in the insurance industry and health care generally, anyone who believes that government can do it a) better and b) more efficiently has simply not been paying attention to the shape government finances are in right now or how large the deficit has grown as it has mismanaged its entitlement empire to this point.

~McQ

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