Monday, October 26, 2009

LTE: Health Care


A common but troubling argument encountered in the health care reform debate claims that, since we already pay for the cost of some people -- such as the unhealthy, the reckless or the irresponsible -- universal participation must be mandated in order to more fairly spread the cost burden across society, thereby reducing the individual burden.

But this argument is based on the false premise that we are each "our brother's keeper," that it is our duty to equally distribute and share suffering, and that governments are established to enforce that ethic.

The problem of society paying is only a problem when otherwise free markets become socialized, with their costs and risks guaranteed by public funds. Witness the auto and bank bailouts. Public funds are transfered by the government to private businesses to aid them in their struggle for solvency. Society then feels justified in dictating the terms of bailouts through their representatives in government. The average citizen is forced into becoming a silent partner in private enterprises in which they have no specialized knowledge or financial stake. The result of all of this is the establishment of an un-free market. This is the type of economy we have in America and it is unsustainable; as we have seen.

In a truly free market, health care costs are not involuntarily borne by society-at-large. They are borne by free individuals and voluntary associations such as private charities or insurance risk pools. The proper, rights-respecting way to reduce social costs is to remove state involvement in the private economy, thereby removing the involuntary, collectivized stake the whole of society has in private sector practices or outcomes.

In those areas of the economy where there is little or no regulation, such as Lasik surgery or computer technology, quality increases, prices go down and access multiplies. The way to accessible and affordable health care is through the prosperity, innovation and economic freedom that comes from a complete separation of economy and state.

Americans don't really have a problem accessing health care. They have a problem accessing the abundant high quality, low cost health care that an unhampered free market supplies.

The costs of health care are certainly on the rise. But this is due precisely to heavy government interference that causes aberrant economic behavior. The solution is not more interference but, instead, the establishment of a truly free market in health care over the hampered, quasi-free market that the health care industry has been laboring under.

Rather than try to solve a government-created problem with more crippling government-oriented solutions, I would advocate a few simple liberty-oriented solutions instead:
  1. Remove legal obstacles to high-deductibility health insurance plans and Health Savings Accounts (HSA's).
  2. Equalize the tax advantages between employer-provided health insurance and individually-owned health insurance. Tax incentives that favor employers also inhibit portability.
  3. Regulate state laws preventing insurance competition across state lines. Making interstate commerce regular is an enumerated federal power; let's exercise it correctly, for once.
  4. Repeal federal mandates prescribing the types of coverage that insurance companies may or may not offer to insurance consumers.
  5. Reform tort law to limit lawsuits that cause physicians to spend hundreds of thousands of dollars on insurance, litigation and defensive medical practices.
  6. Reform the bankrupt Medicare system before contemplating new and greater political controls on a health care system already damaged by too many of them.
  7. Revise tax forms to make it easier to make voluntary, tax-deductible donations to help those who have no insurance and are who are not covered by Medicare, Medicaid or the State Children's Health Insurance Program (SCHIP).


Self-governance Works
John Stossel | October 28, 2009
Free people, given the chance, solve what many "experts" think are problems that require state intervention.