Two of my three favorite columnists at the WSJ Op-Ed page--Holman Jenkins & Daniel Henninger with Bret Stephens writing about Iran--wrote about healthcare this week and their columns were fantastic.
In his column, Jenkins "reflects," in 2070, about the effects of market reform on healthcare in the United States. This is what we could get, if only Eric Paul, Ryan Cantor, and Kemp Newtley were in charge rather than the Democrats.
And, lo, it proved true, as 100 million intelligent, well-educated employees of Corporate America were allowed to see for the first time what "tax free" health insurance was really costing them. They saw how it distorted their behavior and caused them to allocate far more of their incomes to the medical-industrial complex than they would have chosen for themselves.Bookending this imagined optimism, Henninger reminds us that government always over-promises and under-delivers. He uses the "fearmongering scare tactics" of reviewing the history of Medicaid. The faint of heart would do well to ignore historic reality and read the fawning reviews of the President's healthcare plan written by his fellow travelers in the MSM. Henninger just might persuade them that Obama isn't right all the time.
Eyes newly opened, they demanded cheaper insurance options, covering fewer services (cancer wigs, family counseling, in-vitro fertilization), and opted for plans with higher deductibles and co-pays in return for much lower monthly rates.
Because consumers were now spending their "own" money on health care, doctors and hospitals found it necessary to publish and even advertise their prices. A hospital that specialized in heart surgery, performing thousands of procedures a year, found it had both the highest quality and lowest cost -- and now marketed itself as such. Ditto specialists in cancer, diabetes and other conditions.
For the first time, Americans spent less and got more. Spending fell overnight by 13%, which happened to be exactly what economists had predicted if the price tags were restored to health care and consumers were allowed to see clearly what they were getting (or not getting) for their money. As predicted, too, spending thereafter rose only in line with incomes.
What's more, many fewer people remained voluntarily uninsured now that health insurance was no longer a gold-plated extravagance affordable only by those in the top brackets who could slough off 40% of the cost on other taxpayers. Existing programs for the needy, in turn, could be downsized and revamped into voucher programs. The federal budget benefited twice over -- from fewer claimants and from medical care that was less costly. Fiscal wreck was avoided.
Whatever Medicaid's merits, this federal health-care program more than any other factor has put California and New York on the brink of fiscal catastrophe. I'd even call it scary.The President's "public option" will cost more in taxes, provide poorer overall medical care and will infringe on individual liberty. These are the facts.
Spending on health and welfare, largely under Medicaid, makes up one-third of California's budget of some $100 billion. In New York Gov. David Paterson's budget message, he notes that "New York spends more per capital ($2,283) on Medicaid than any other state in the country."
After 45 years, the health-care reform called Medicaid has crushed state budgets. A study by the National Governors Association said a decade ago that because of "new requirements" imposed by federal law -- meaning Congress -- "Medicaid has evolved into a program whose size, cost and significance are far beyond the original vision of its creators."
In his speeches, Mr. Obama makes the original vision of his "public option" insurance plan sound about as simple as driving through toll booths with an electronic pass on your windshield. It's going to be all about "best practices" with patients "reimbursed in a thoughtful way," as if the federal government is about to become just another big Google.
Medicaid is a morass. Since the program's inception, Congress has loaded it up every few years with more notions of what to cover, shifting about 43% of the ever-upward cost onto someone else's tab, mainly the states. A 1988 congressional mandate requires local schools to pay for schooling and related services for disabled children, but because Congress underfunds its mandates, the states pay the rest through Medicaid.
The list of add-ons is endless, and there's little about it that is thoughtful. Why shouldn't one think that, as with Medicare and Medicaid, the Obama Public Option in time will become an impossible fog for patients to navigate? But unto eternity the program's administrative complexity will provide work for bureaucrats, Members of Congress, their staffs, lobbyist spouses and the "health-care" establishment of foundations and economists.
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