Don't be fooled by the promise "You can keep your employer's health insurance" under the Obama plan. Yes, you can, but eventually you won't want to, and ultimately your employer will opt out of providing health insurance to their employees when they are crushed by the competition from the government. Under the guise of increased choice, Obamacare is a cynical slide to socialized, single-payer, government-run medicine.
The proponents of single-payer health care point to the big prize: universal coverage, a generally desirable goal. In reality, universal coverage is impractical.
They ascribe to the socialist philosophy "to each according to their need." In other words the distribution of health benefits should be according to one's needs, not one's wallet. Sounds good, but it fails in practice. Man does a poor job controlling the satisfaction of his needs independent of his wallet.
Old Chinese proverb: As the wallet grows, so do the needs.
New proverb: When it's the government's wallet, spending goes through the roof.
Under the socialist philosophy, health care becomes defined as a right, not a personal responsibility of the individual. When the individual decision maker is absent, the need for a central decision maker or planner is created. At its worst is soviet-style central planning: "Everything is free, but nothing is available," and their famous rationale is "it has never worked because the right people have never been in charge."
Canadians are proud of their universal coverage where poor man and rich manalike receive equitable health care, an argument underlying Obamacare. An underlying assumption is that universal health care will improve the health status of the poor man. Has Canadian universal health care raised the quality of health of the poor man relative to the rich man? An astounding result in a study by David and June O'Neil on the white non-elderly population shows that under the Canadian universal coverage single-payer plan, low-income Canadians are 22 percent more likely to be in poor health than their American counterparts under our fragmented, mainly employer-based medical system.
The single-payer plan abolishes one's individual rights. It denies one the right to self-pay or choose the plan that suits you best. It denies the right to purchase catastrophic insurance, a true insurance plan. In our current employer-based, third-party payer system, constraints interfere with self-pay and true insurance options, but they are still options for many Americans. Under Obamacare these options will be trashed.
Do you have the right to quality care? Screenings for prostate cancer, breast cancer, colon cancer, cervical cancer are less frequent in Canada then here, explaining why cancer mortality rates are up to 25 percent higher. Fewer Canadians receive care for hypertension, asthma, diabetes and coronary heart disease than in the U.S. The U.S. has better blood pressure control than Europe, better quality of life for spinal cord injury patients than in Canada and the UK, and higher dialysis rates than the UK for the same renal disease prevalence. The U.S. has higher use of statins to lower cholesterol and higher use of anti-psychotics for treating schizophrenics.
The list goes on.
In a single-payer system, care is "free," but is it available? When patients overconsume in a single-payer "free" system, care is rationed through waiting and exclusions. Canadians have given up their right to prompt surgical care, waiting an average of 14 weeks. For some surgeries the wait is more than a year. This is after you wait to see a consultant to confirm your need for surgery.
Is cost control superior under a single-payer plan? In a word, no. A recent National Bureau of Economic Research working paper on health care finance, based on data from countries belonging to the Organization of Economic Cooperative Development including all nations commonly touted as models for U.S. health care, concluded that "there has been no consistent and systematic relationship between financing and cost containment."
Is the claim by single-payer system advocates true that the free market system has been a failure? Problems exist, yes, but it hasn't failed. Since the inception of the employer-based system defined benefit health care following WWII, the current so-called "free market" health care delivery system is still untested. To believe otherwise is to deny the pervasive effect that the government has on the current private insurance market.
A Hoover Institution report says an astonishing 80 percent of medical-care pricing is based on government reimbursement rates set by Medicare. Further, regulations imposed on the industry cost more than $330 billion a year.
In the 1990's the government actively promoted managed care, believing it would reign in cost. Did the government vigorously promote Health Savings Accounts? No. That's curious since estimates show that increasing the number of Americans who buy their own health insurance from 17 to 50 million with Health Savings Accounts would reduce health care costs 30 percent from increased market competition alone.
Is it alarming that the government pays for about 60 percent of health care? Medicare costs per capita is more than any other industrial nation's public medical program.
The single-payer system kills the incentive to innovate. For example, recently the Duke Medical Center lowered the cost of treating congestive heart failure patients by 40 percent in one year with innovations that improved patient health. However, Duke lost all the savings created by losing Medicare revenue for hospital stays and doctor visits. Where's the incentive?
Switzerland is perhaps the best example of a universal health care system. Citizens are required to buy their own insurance and pay 32 percent of expenses out-of-pocket. Innovation is stifled by single-payer-style micromanagement of medical care suppliers. Restricting physician access to the latest advances is a disservice.
What is the answer to Obamacare? Here is what Benjamin Zycher of the Manhattan Institute of Policy Research has to say: "A deregulated system not tied to employment, on the other hand, would resemble the markets for life insurance or long-term care insurance. Individuals would have powerful incentives to purchase such policies when young, paying fair premiums, with efficient risk pooling in the insurance market yielding coverage for whatever level of health care expenditures for which individual consumers are willing to pay. The problem of the poor can be addressed in such a system in several straightforward ways, among them the provision of vouchers for the purchase of private insurance plans. A reorientation of the current public debate toward that kind of reform would be salutary."
The AMA Health Care Plan and McCaincare embody the voucher concept. The difference between McCaincare and Obamacare can be thought of this way: McCaincare is a defined contribution plan, while Obamacare is a defined benefit plan. We have already seen retirement plans evolve from the pension, a defined benefit plan, to the 401k plan, a defined contribution plan.
Putting the levers of controlling health care cost in the hands of individuals instead of central planners results in reduced cost. This was shown years ago when the RAND health insurance experiment demonstrated that people who used their own funds to buy health care reduced spending by 30 percent without harming their health.
Fifty years of experience has shown that single-payer systems produce lousy health care at exorbitant cost. Isn't it high time to try something else?
Dale Vaslow is the president of the Boone County Medical Society. This column was first published in the group's monthly newsletter, Prescriptions.