Posted by
CommonMan on Wednesday, August 01, 2007 10:53:38 AM
Universal health care is being promoted by all of the presidential candidates from the Democratic party. The Democratic candidates are just plain wrong on this issue. The major flaw of any universal health care proposal is the underlying assumption that resources are infinite. While the health care system resources are vast in this country (expected to consume 1 of every $5 in the U.S. economy by 2015), they are not infinite.
Currently, the health care system has multiple streams of income. Some of the health care resources are paid by government through Medicare, Medicaid and other programs; some of the health care resources are paid for by private parties like insurance companies, and some is paid for by individuals.
As an example, assume that the average cost of a normal birth is $7,500. In our current system, the larger payers are able to negotiate better rates than smaller payers, so for the purposes of example, let's assume the average cost of a normal birth is $6,000 for the government. To make up for their losses, doctors, hospitals, and other health care providers must charge other payers like insurance companies and individuals more than the average cost for a normal birth. In this example assume big insurance companies have a cost of $8,000 and individuals are left to pay $9,000 for a normal birth. In all, the average price is $7,500.
Most single-payer (the federal government), universal health care proposals make the assumption that the cost of a normal birth is the same as the current rate the government is paying, $6,000. So if the government continues to pay $6,000 per normal birth, doctors, hospitals, and other health care providers will either go broke or they will simply stop offering services that are no longer profitable. To compensate for the decline in service, the federal government will then be forced to create federally funded health care facilities, where the staff is paid directly by the government, in order to meet the need for service.
The ripples then extend to medical schools. What starry-eyed medical student will want to take on hundreds of thousands of dollars in personal debt for a medical school education, so they can get a government job? With a decline in med students, health care resources will become even scarcer. The result is long waits, sub standard care and the rise of a "black market" health care system where the haves get the care they need when they need it, while the have-nots wait.
Of all the presidential candidates, I think Mike Huckabee and Rudy Giuliani are on the right path to creating a health care system that is innovative, effective and robust. Both candidates promote individual responsibility as the cornerstone of health care reform. Giuliani and Huckabee want to encourage individual responsibility through tax incentives for individuals to purchase health insurance on their own and Giuliani wants to allow health insurance policies to be sold across state lines.
Rather than provide tax incentives for individuals to purchase health insurance, I think an even better approach is to REMOVE the tax incentive offered to employer-based health insurance. When individuals start to fully feel the impact of health care costs, a health care consumerism will take hold and real change will begin to happen.
But no matter what approach is taken, whether that be a single-payer, universal system or a system based on individual responsibility, changes in the health care system will not happen overnight, but a real paradigm shift in how we deliver health care in this country will take a generation.
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