Tag: Health

Beyond Irony

Karl Rove should have been named Man of the Year at some point by the Democratic National Committee. The political consultant/Bush adviser played a big role in expanding the burden of government, convincing Bush to saddle the nation with fiscal disasters such as the “no-bureaucrat-left-behind” education bill, the corrupt farm bills, the pork-filled transportation bills, and the horrific new entitlement for prescription drugs. He also helped ruin the GOP image with his inside-the-beltway version of “compassionate conservatism,” thus paving the way for big Democratic victories in 2006 and 2008.

I can understand why libertarians have no desire to listen to his advice, but I’m baffled why Republicans or conservatives would give him the time of day. Yet he is a constant presence on FOX News and has a weekly column in the Wall Street Journal. With no apparent irony, his latest WSJ column is entitled “How to Stop Socialized Health Care.” Too bad he didn’t follow his own advice in 2003 when pulling out all the stops to enact the biggest entitlement in four decades.

Remember, Government Control Ensures Good Health Care

Well, sometimes maybe. 

Reports the National Post:

An investigation has been launched after a woman admitted to Montreal’s Royal Victoria Hospital for an induced birth was forced into a do-it-yourself delivery last month, with only her common-law partner to assist.

“We’re taking it very seriously,” Dr. Matt Kalina, assistant director for professional services at the McGill University Health Centre, said. “We’re reviewing the specific events thoroughly with the family…. We’re using the lessons to improve our systems.”

At about 5 a. m. on May 13, medical help failed to appear even after Karine Lachapelle’s water broke.

Despite attempts to summon help by partner Mark Schouls, who was pushing the nurse-alert button with increasing frequency as Ms. Lachapelle’s contractions became more intense and closer, the two delivered their new son, Kristophe, entirely on their own.

Ms. Lachapelle pushed the child out past his shoulders and face down– allowing Mr. Schouls to get a grip and pull the newborn the rest of the way out, he recounted.

Obviously, the U.S. system has its problems.  But it isn’t even really a private system, since the government pays for such a large share of medical costs and skews the entire insurance system through federal tax policy.  Nevertheless, there are far more private options and patients have far more control than in government-run systems.  It is imperative that any “reform” effort preserves both private alternatives and patient choice.  Indeed, the only real reform would be to make health care truly consumer-directed.

Ezra Klein: Socialized Medicine = Slavery

The Church of Universal Coverage really, really, really wants you to think that the Democratic health care reforms moving through Congress are not “socialized medicine.”  Last year, I wrote a paper about why they’re wrong. On June 25, I’ll be debating the issue at a Cato policy forum with the Urban Institute’s Stan Dorn.

Today, The Washington Post’s Ezra Klein lends his voice to the chorus of socialized-medicine deniers. Klein doesn’t add much to the discussion, except for this: Klein (correctly) observes, “Socialized medicine is a system in which the government owns the means of providing medicine” (emphasis his).  Single-payer systems, like the U.S. Medicare program or France’s health care system, are not socialized medicine because “the payer does not own the doctors.”

That’s right. Under socialized medicine, the government owns the doctors. When human beings can be owned, we call that slavery. Klein was probably just trying to do what other Church of Universal Coverage faithful have done over the past few years: narrow the definition of socialized medicine to the point where it has no meaning at all. (Duh, Canada doesn’t have socialized medicine – they don’t put Canadian doctors in chains, do they??)

Instead, Klein was inadvertently helpful because he clarified that the reforms he supports, and the reforms before Congress, would give the government ownership over the human capital of doctors and other clinicians. Whether we’re talking about wages, insurers’ assets, medical facilities, medical products, or even clinicians’ labor, ownership is a bundle of rights. If health care reform gives government the right to exclude people from using those resources in forbidden ways (e.g., retainer medicine, balance-billing, pure fee-for-service, whatever), then government gains control over a larger share of each bundle of ownership rights.  That equals more state ownership – of financial, physical, and even human capital – which is the very yardstick Klein uses to define socialized medicine.

If only all the socialists could be so helpful.

Kennedy’s Health Bill: A First Look

A draft of Sen. Ted Kennedy’s health care reform bill is finally available, and it is difficult to overstate how far he would move us to a government-run health care system. An initial read-through reveals among the key provisions:

  • An individual mandate, requiring that every American purchase a “qualified” insurance plan. (Sec. 161(a)) The mandate will be enforced through the tax code with Americans required to pay a penalty if they fail to comply.  In an extraordinary delegation of congressional authority, the Kennedy bill would give the Secretaries of Treasury and Health and Human Services the power to determine what this penalty should be. Individuals would be required to submit information on their insurance status over the previous year to the Secretary of HHS, along with “any such other information as the Secretary may require.” (Sec. 6055(b)(2) and (3)). Individuals who already have insurance could keep it. However, if they changed plans (or presumably changed jobs), their new insurance would have to meet the definition of “qualified.”
  • A “pay or play” employer mandate requiring employers to provide all workers with health insurance and pay a minimum amount of the premium, or pay a tax (Sec 162). Again, the amount of the new tax is left to the discretion of the Secretaries of HHS and Treasury. Some small employers would be exempt from the mandate, but the size of those firms remains TBA. (Sec. 3113(g)) Companies with fewer than 250 workers would be forbidden to self-ensure. (Sec. 2720)
  • A new federal bureaucracy, the Medical Advisory Council, which would determine what benefits will be required to be part of your “qualified” insurance plan. (Sec. 3103(h) and (i)). Lest anyone think Congress won’t get involved. The Council’s decisions can be disapproved by Congress if, say, they don’t mandate inclusion by a favored provider group or disease constituency. (Sec 3103(g)).
  • Massive new federal subsidies. Medicaid would be expanded to individuals earning 150 percent of the poverty level, and the federal government would pay all incremental costs of the increased enrollment. (Sec 152.) Single, childless adults would become eligible for Medicaid. Even more egregious, individuals and families with incomes between 150-500 percent of the poverty level ($110,250 for a family of four) would be eligible for subsidies on a sliding scale-basis.(Sec. 3111(b)(1)(A-G)).
  • Insurers would be required to accept all applicants regardless of their health (guaranteed issue) and forbid insurers from basing insurance premiums on risk factors (Community rating). There does not appear to be any exception for lifestyle factors, such as smoking, alcohol or drug use, diet, exercise, etc. Thus, not only will the young and healthy be forced to pay higher premiums to subsidize the old and unhealthy, but the responsible will be forced to pay more to subsidize the irresponsible.
  • A “public option” operating in competition with private insurance (Section 31__). How this plan would be funded, the level of premiums, etc. is left mostly TBA. In response to criticism, the Kennedy bill does require that the public plan pay providers 10 percent above Medicare reimbursement rates. (Sec 31__(B)). That would still allow for a considerable degree of cost-shifting to private insurance. And, we should recall that such promises are ephemeral. When Medicare began, proponents promised it would reimburse at the same rate as insurance. That promise didn’t last long.
  • States would be prodded to set up “gateways,” similar to Massachusetts’ “connector.” (Sec 3104(a)) If a state fails to do so, the federal government will set one up for them. (Sec. 3104(d)) The federal government would provide grants to states to help them set up these gateways. The amount of the grants is, you guessed it, left to the discretion of the Secretary of HHS. Gateways may also fund their operations by assessing a surcharge on insurers. Sec. 3101(b)(5)(A)/
  • A new federal long-term care program (Sec 171).

Kennedy does not include any estimate of how much his plan would cost, nor any proposal for how to pay for it.

More details will undoubtedly emerge, but it is very clear that the Kennedy plan would put one-sixth of the US economy and some of our most important, personal, and private decisions firmly under the thumb of the federal government.

The Cost of Health Care

From a patient’s point of view, the ideal health insurance policy would offer unlimited access to medical services at no charge. Unfortunately, it is not feasible to offer this to everyone.

The key to sustainable health care reform is restraining the use of services that have high costs and low benefits, says Cato adjunct scholar Arnold Kling.  In the video below, Kling examines the challenges facing health reformers and the feasibility of alternative proposals.

Week in Review: A Speech in Cairo, an Anniversary in China and a U.S. Bankruptcy

Obama Speaks to the Muslim World

cairoIn Cairo on Thursday, President Obama asked for a “new beginning between the United States and Muslims around the world,” and spoke at some length on the Israeli-Palestinian conflict, Iran, Iraq, and Afghanistan. Cato scholar Christopher Preble comments, “At times, it sounded like a state of the union address, with a litany of promises intended to appeal to particular interest groups. …That said, I thought the president hit the essential points without overpromising.”

Preble goes on to say:

He did not ignore that which divides the United States from the world at large, and many Muslims in particular, nor was he afraid to address squarely the lies and distortions — including the implication that 9/11 never happened, or was not the product of al Qaeda — that have made the situation worse than it should be. He stressed the common interests that should draw people to support U.S. policies rather than oppose them: these include our opposition to the use of violence against innocents; our support for democracy and self-government; and our hostility toward racial, ethnic or religious intolerance. All good.

David Boaz contends that there are a number of other nations the president could have chosen to deliver his address:

Americans forget that the Muslim world and the Arab world are not synonymous. In fact, only 15 to 20 percent of Muslims live in Arab countries, barely more than the number in Indonesia alone and far fewer than the number in the Indian subcontinent. It seems to me that Obama would be better off delivering his message to the Muslim world somewhere closer to where most Muslims live. Perhaps even in his own childhood home of Indonesia.

Not only are there more Muslims in Asia than in the Middle East, the Muslim countries of south and southeast Asia have done a better job of integrating Islam and modern democratic capitalism…. Egypt is a fine place for a speech on the Arab-Israeli conflict. But in Indonesia, Malaysia, India, or Pakistan he could give a speech on America and the Muslim world surrounded by rival political leaders in a democratic country and by internationally recognized business leaders. It would be good for the president to draw attention to this more moderate version of Islam.

Tiananmen Square: 20 Years Later

tsquare1It has been 20 years since the tragic deaths of pro-democracy protesters in Tiananmen Square in June 1989, and 30 years since Deng Xiaoping embarked on economic reform in China. Cato scholar James A. Dorn comments, “After 20 years China has made substantial economic progress, but the ghosts of Tiananmen are restless and will continue to be so until the Goddess of Liberty is restored.”

In Thursday’s Cato Daily Podcast, Dorn discusses the perception of human rights in China since the Tiananmen Square massacre, saying that many young people are beginning to accept the existence of human rights independent of the state.

A few days before the anniversary, social media Web sites like Twitter and YouTube were blocked in China. Cato scholar Jim Harper says that it’s going to take a lot more than tanks to shut down the message of freedom in today’s online world:

In 1989, when a nascent pro-democracy movement wanted to communicate its vitality and prepare to take on the state, meeting en masse was vital. But that made it fairly easy for the CCP to roll in and crush the dream of democracy.

Twenty years later, the Internet is the place where mass movements for liberty can take root. While the CCP is attempting to use the electronic equivalent of an armored division to prevent change, reform today is a question of when, not if. Shutting down open dialogue will only slow the democratic transition to freedom, which the Chinese government cannot ultimately prevent.

Taxpayers Acquire Failing Auto Company

After billions of dollars were spent over the course of two presidential administrations to keep General Motors afloat, the American car company filed for bankruptcy this week anyway.

Last year Cato trade expert Daniel J. Ikenson appeared on dozens of radio and television programs and wrote op-eds in newspapers and magazines explaining why automakers should file for bankruptcy—before spending billions in taxpayer dollars.

Which leaves Ikenson asking one very important question: “What was the point of that?

In November, GM turned to the federal government for a bailout loan — the one final alternative to bankruptcy. After a lot of discussion and some rich debate, Congress voted against a bailout, seemingly foreclosing all options except bankruptcy. But before GM could avail itself of bankruptcy protection, President Bush took the fateful decision of circumventing Congress and diverting $15.4 billion from Troubled Asset Relief Program funds to GM (in the chummy spirit of avoiding tough news around the holidays).

That was the original sin. George W. Bush is very much complicit in the nationalization of GM and the cascade of similar interventions that may follow. Had Bush not funded GM in December (under questionable authority, no less), the company probably would have filed for bankruptcy on Jan. 1, at which point prospective buyers, both foreign and domestic, would have surfaced and made bids for spin-off assets or equity stakes in the “New GM,” just as is happening now.

Meanwhile, the government takeover of GM puts the fate of Ford Motors, a company that didn’t take any bailout money, into question:

Thus, what’s going to happen to Ford? With the public aware that the administration will go to bat for GM, who will want to own Ford stock? Who will lend Ford money (particularly in light of the way GM’s and Chrysler’s bondholders were treated). Who wants to compete against an entity backed by an unrestrained national treasury?

Ultimately, if I’m a member of Ford management or a large shareholder, I’m thinking that my biggest competitors, who’ve made terrible business decisions over the years, just got their debts erased and their downsides covered. Thus, even if my balance sheet is healthy enough to go it alone, why bother? And that calculation presents the specter of another taxpayer bailout to the tunes of tens of billions of dollars, and another government-run auto company.

Just Say No to Public Option Health Care

In today’s New York Times, Paul Krugman writes about the necessity of a public option in health care. Why is a public plan such a bad idea? I explain in my post over at The Corner:

A public plan, regardless of how it was structured or administered, would have an inherent advantage in the marketplace over private insurance companies because it would ultimately be subsidized by American taxpayers. It would also have an advantage since its enormous market presence would allow it to impose much lower reimbursement rates on doctors and hospitals, similar to current reimbursement practice under Medicare and Medicaid. It is estimated that privately insured patients presently pay $89 billion annually in additional insurance costs because of cost-shifting from government programs. Assuming the new public option would have similar reimbursement policies, it would result in additional cost-shifting as much as $36.4 billion annually. This would force insurers to raise their premiums, making them even less competitive with the taxpayer-subsidized public plan.

With the public option squeezing private insurers from the sides, and expanded eligibility for Medicare and Medicaid pushing from the top and bottom, it is unlikely that any significant private insurance market could continue to exist. America would be firmly on the road to a single-payer health care system with all the dangers that presents.