Sunday, March 28, 2010

ObamaCare; Why America is in Trouble

Healthcare in the US is in trouble. ObamaCare as it now sits will probably bankrupt the United States, without really making quality healthcare more available. ObamaCare has been structured more like fascism than socialism. In this case, Socialism probably would have been better; at least we would have had more available healthcare; that is until the money ran out. Unfortunately, what we ended up was Healthcare through the same Healthcare providers that caused the country to focus on healthcare reform in the first place. Another reason is the Republicans also ignored the problem for 8 years. The American public will now be forced to buy Health Insurance from these same Insurance providers with few price controls and still no competition. It turns out Senate Bill was written by a Insurance provider former vice-president, Elisabeth Fowler, now a council for Sen Baucus, so it’s no wonder many have come to the realization that ObamaCare is a bill that was written by the Insurance providers for the Insurance providers; take ObamaCare, remove the public option, and you have a Healthcare Insurance bailout.

There are many, including myself that believe that, the nature of how Health Insurance evolved, is the basis of the problem. Originally, Health Insurance worked like most Insurance. It was like Auto Insurance, you paid in case you had an accident and the Insurance companies made money because more money was paid in than needed to pay of claims. However, in the 30’s, when single payer first showed it’s head, the Insurance companies took notice that health insurance could be treated more like a business then a relationship between doctor and patient and the HMO was born. “Health Maintenance”, Healthcare Insurance is now the equivalent of an auto maintenance and extended warranty plan. You pay more because the maintenance service is expected, but the warranty company still makes money because again more money is paid in than needed to replace the more expensive major components. That fact is very few auto maintenance plans are purchased because they are prohibitively expensive. The reason is simply, the 60,000 mile maintenance on a Honda Accord can cost over $2000. Because car owners have to pay cash for this, they usually don’t go full boat on vehicle maintenance, knowing periodic oil change and tune up (maybe a timing belt) and the car will usually last over 100,000 miles. So a service maintenance plan usually results in higher maintenance costs overall.

The same goes for Health Insurance. If you only go when it’s necessary and pay cash the price would be less. But Health Insurance hides the real cost of healthcare and as the saying goes, “if something is very free, it has no value” or in this case, if healthcare prices are believed to be the deductible or co-pay, then it’s true value is hidden. Many doctors say they could charge much less, if they didn’t have to deal with insurance or Medicare. The other problem is those who have insurance, pay for those that don’t. In the United States, healthcare is not a right, but it is an obligation, so no one is denied medical care for lack of insurance or money. But, when an un-insured person is treated in a hospital, the hospital needs to charge more for medical care paid for by Insurance to pay for it. Further, since the States regulate Healthcare Insurers, the Insurance companies can not sell popular plans, such as catastrophic medical. The Insurers are also forbidden to sell across state lines, which diminishes competition. Another poison pill is that lack of tort reform. While not a major medical expense ($10 billion), it is another hindrance to the quality of care a doctor can provide, as it is an additional barrier between the doctor and patient.

As I mentioned before, the problem with Singlepayer, or socialized medicine, is socialism has no mechanism for generating capital, beyond taxing the public. What has become apparent in every singlepayer system in the world, is the cost of socialized medicine’s never stops increasing and without restrictions leads to tax rates that are so high that business can not survive and/or the country will become insolvent. The answer to this is rationing care, known in ObamaCare as Comparative Medicine. The reason Comparative Medicine does not appear in the ObamaCare bill recently signed into law by President Obama, is it was signed in earlier as an attachment to the stimulus bill. Like Britain’s N.I.C.E, Comparative Medicine is Health Care based on a cost analysis pitting cost against effectiveness and age. NIH Chairman, Ezekiel Emanuel writes, When implemented, the "complete lives" system produces a priority curve on which individuals aged between roughly 15 and 40 years get the most substantial chance, whereas the youngest and oldest people get chances that are attenuated”. In other words, if a costly procedure will not result in a significant extension of life, it will be refused and according to the most recent HealthCare bill (now law), the Comparative Effectiveness Panel’s decision is final and un-appealable.

One of the most cherished and repeated lines from the Declaration of Independence is, We hold these truths to be self-evident that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. The concept that is most misinterpreted is “the pursuit of Happiness”. When Thomas Jefferson wrote these words, he was borrowing the heavily from the English Philosopher, John Locke’s writings such as, "no one ought to harm another in his life, health, liberty, or possessions”. The concept of the “pursuit of happiness”, does not obligate the State to do anything, but mandates the State get out of the way and not hinder the right of man to improve his station in life. As I said before, Healthcare is not a right, because a right, according to our founding fathers come from god, Healthcare is rather an obligation of the State, but unlike a right, can be given or taken away by the whim of the State. What really needs to be looked at is how this obligation can be fulfilled without standing in the way of the American people. In my next blog I will discuss some options.

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