There are at least three reasons why Americans are skeptical of health care reform.
First, the overwhelming majority of people in the United States have health insurance and are quite satisfied with it, so the catastrophic rhetoric doesn’t resonate with them. According to the Census Bureau, approximately 84 percent of the U.S. population is insured. And the majority of the remaining 16 percent either already qualify for existing government programs like Medicare and Medicaid but have not enrolled, could afford insurance but choose not to purchase it, or are only temporarily uninsured because they are between jobs. Moreover, according to recent polling, fully 68 percent of U.S. voters have health insurance coverage that they rate as either good or excellent. As a result, being told that the current system is broken and it’s imperative that we scrap it in favor of a government-run alternative sounds a lot like being told you need to kick a hole in the bottom of the boat to let the bilge water out.
Second, although President Obama has repeatedly said that “a public option … will give people a broader range of choices and inject competition into the health care market,” most people realize that government is a monopoly and monopolies generally aren’t that partial to competition (or efficiency, or cost-reduction, etc.). You see, government isn’t “just another competitor.” For starters, unlike private firms, it doesn’t have to entice people to voluntarily hand over their money. It can simply take it through taxes. Even more importantly, government controls the rules of the game. The current House bill is most instructive on that point. According to that legislation, private insurers would be constrained from offering policies that differed substantially from the “public option.” Telling your competitors that they can offer any product they want, as long as it’s identical to yours, throttles their ability to innovate. That doesn’t increase choice or competition, it kills them.
The assertion that government control will reduce health care costs also rings hollow. That just hasn‘t been our experience – ever. Although I could fill a textbook on why that’s true, for the sake of brevity, let’s just focus on the empirical evidence. The Congressional Budget Office estimates that rather than reduce expenditures, the currently proposed legislation would actually add $1 trillion or more to the federal deficit over the next decade. And there’s good reason to concentrate on the “or more” part. When Medicare Part A (our current “public option” for those 65 and over) was first introduced in 1965, it was projected that total program costs would be $9 billion in 1990. Actual costs? $67 billion – that’s 744% above the original projection. More pertinently, Medicare is expected to go bankrupt in 2017, only eight years from now.
Third, coming immediately after unprecedented government takeovers in the finance and automobile industries, this proposed transition toward government-run health care strikes at the very heart of the American experience. Lincoln put it most eloquently in his Gettysburg address. The inheritance and the duty that each American generation bequeaths to the next are to ensure “that government of the people, by the people, for the people, shall not perish from the earth.” The government takeover of something as intimate as health care fundamentally and irrevocably alters that equation because the people necessarily become dependents of the government, not its master. In essence, we go from “government of the people,” to “people of the government.”
So, what should we do? In a recent column in the Wall Street Journal, John Mackey, the co-founder and chief executive of Whole Foods, had some excellent suggestions. Among them: “repeal all state laws which prevent insurance companies from competing across state lines” – unlike the administration’s proposal, removing these restrictions really would increase competition and drive down costs; “repeal government mandates regarding what insurance companies must cover” – these requirements restrict companies to more-expensive, higher-end, one-size-fits-all policies, significantly driving up costs; and “enact tort reform” – a study by the Massachusetts Medical Society found that around 25 percent of the tests, procedures, and referrals that doctors order are done solely to avoid lawsuits, by some estimates eliminating this waste could save $200 billion per year.
In short, if we really want to decrease health care costs while maintaining the innovation and quality we now enjoy, we need to reduce the influence of politics and government over the relationship between a patient and their doctor, not increase it.
A. Fletcher Mangum is managing partner of Mangum Economic Consulting, a Richmond-based firm.
i love these types of articles because it makes it more dramatic when obama’s bill passes – which it will – and he can say, “there were a lot of doubters, a lot of people thought we couldn’t pull it off…”. but hey, if it gets you viewer-ship and makes a few uninformed people misinformed, have fun. and by the way if you’re claiming that 100% of the population is or could be covered, that’s categorically false. don’t over do it on your mis-info… you’ll give yourself away.
That’s the best, most informative op-ed piece I’ve read to date on the health care issue. It is so clear that the more we give government to do, the less efficient it will be at doing it. Giving government control of anyone’s health care is simply insanity.
I fully support the author opinion about healh care, less lawyers desicions, more doctors and patients decisions what good or bad for the patient. Our gavenrment and Senate is gun by lawyers and most of the time have their own interest in mind. Very reasonable proposal by the Whole foof CEO, which is akready working for thier employers. Thanks for beeing brave enough and having commom sence. Alex
I’m a 30 year old male whom just got married, who is paying $220/mo for medical insurance. To add my wife to my plan would cost an extra $340/mo whom she is 31. That is $560/mo in medical insurance, which is 58% the cost of our apartment. Now, how is this affordable???
A. Fletcher Mangum, I see thanks to Google, is an economist who has made a donation to the Republican candidate for governor. Perhaps he is looking for a position in what he hopes to be the next Commonwealth of Virginia administration. If so, I would advise that the thoughtful Virginia Republicans I know are more careful with the facts.
Blessedly, he numbered his points….
1) “…being told that the current system is broken and it’s imperative that we scrap it…”
No one is saying that.
2) “government controls the rules of the game.”
Right. That…is…what…government…does. Duh.
Then he says, “According to that legislation, private insurers would be constrained from offering policies that differed substantially from the “public option.””
No, it does not.
He follow that with an apples and oranges comparison. (OK, they’re both fruits. His is worse.) First, he says the claim that “government control will reduce health care costs also rings hollow.” He answers that saying, “The Congressional Budget Office estimates that rather than reduce expenditures, the currently proposed legislation would actually add $1 trillion or more to the federal deficit over the next decade.” That has nothing to do with reducing costs. More money will be needed for providing more health care. Again, duhhhhhh.
3) Finally, our guest columnist says the health plans being promoted by the party in power now will mean we go from “government of the people” to “people of the government.”
I’ll quote, Paul Krugman, winner of the 2008 Nobel Memorial Prize in Economic Science. “The romanticized and sanitized vision of the economy led most economists to ignore all the things that can go wrong.” Likewise, a romanticized and sanitized vision of our any form of government will do the same.
Most of the people I talk about their health-insurance are not satisfied with it
So the catastrophic rhetoric doesn’t resonate with them.
The data of 84% insured and 16% covered by government programs can not be right, and has to be old. A lot of families without health insurance are not protected for government programs.
We have near 10% unemployment now, and another big percent or people that are accepting jobs without insurance, with lower salaries. They are not in the 84% or 16%
What do those families do if they have an emergency?
We did a lot for our corporations, now we have to protect our families. We need a health care reform.
Fixing just one piece at a time would be progress, but that is difficult for congress to do apparently. Even just tort reform (specifically what lawyers could sue for in malpractice cases) would lower health care costs. When you and your doctor buy insurance, you are basically paying for your percent of all the risk, your percentage of malpractice, etc.
For the person that thinks their healthcare plan is too much, you need to shop. Research the company you plan on using and possibly even get an insurance agent to help you research plans. You can get a base plan with large deductible that will protect you from a bankrupting illness or disease. My family of six in Missouri is roughly $300 a month for a good solid plan, but you pay for your own expenses up to $5,000 a year. People need to budget for their healthcare, but I don’t want the government telling me what to pay and then rationing our care when it comes to my families health.
This is just a big power grab for the government and sincere people not realizing how real economics and the real world work. Even congress is not going to give up their tax payer paid plan to join this health care plan of their own creation. And our local democratic representative is oblivious to the questions and facts presented to him. This next election cycle should give a lot of them a sound awakening.
Josh,
You seriously need to speak with a broker. I would be glad to help you out, if you need help finding one that has a clue.
Elena,
“Most of the people I talk about their health-insurance are not satisfied with it
So the catastrophic rhetoric doesn’t resonate with them.” Yes, I know them too. They are the same people that have not done any research and don’t understand their policy or don’t understand the value of what plan they have.
Fletcher,
Good write up, I think a lot more people think the way you do than the more vocal public voices know. I do feel that as a community, and I do mean Richmond, VA, we have a long long way to go in educating our employees and employers about what health insurance is and what it should and should not be used for. I feel that HMO’s have catastrophically mislead the general public about what insurance is for. Generic Drug = $5, Name Brand = $10, I don’t think so, its more of a 1:10 cost ratio, not a 1:2 like your HMO would like you to believe. Without writing a book about what is driving up our insurance premiums here. I encourage everyone register and come learn what is really going on in the insurance industry and stop reading what is going on in Washington. http://healthcaresolutionssummit.com/