Commentary Magazine


Topic: American Medical Association

Why the Universal Health-Care Insurance Fetish?

Republicans have been tossing out alternatives to government-centric ObamaCare for some time. They have suggested, among other ideas, that we change the tax treatment of individually purchased insurance plans, reform the tort system, and allow interstate insurance sales. But now Jim Prevor raises an interesting and compelling question: if people want to go without insurance and instead self-insure, why is it the government’s job to stop them? Or put differently:

The fact that the national debate has focused on insurance for health care–as opposed to the accessibility of care–is a byproduct of the particular worldview that all “basic needs” should be provided by communal institutions, preferably the government but, alternatively, highly regulated companies that do the government’s bidding.

Prevor suggests that we “give families money or vouchers that they could use to buy health insurance or any other thing they deemed helpful to their family’s future” and urges lawmakers to work on the supply side of care, not insurance, by among other things “wreak[ing] havoc on the American Medical Association’s efforts to restrain the supply of doctors.” Along the lines of Prevor’s argument, one of the more successful ventures in the Bush administration was emphasis on community health centers that expand care for needy Americans, quite apart from the insurance part of the equation. And expansion of medical accounts, which allows individuals to either buy insurance or pay for medical cost directly, would, following Prevor’s argument, maintain personal responsibility, individual choice, and make health-care purchases more accessible by allowing individuals to use pre-tax dollars to pay for their own care.

But what of the “cost shifting” problem caused by uninsured people? Well, now that the Democrats propose to dump millions of people into Medicare, which doesn’t fully compensate doctors and hospitals, it appears as though that argument is going by the wayside. Furthermore, as Mike Tanner of CATO has explained, cost shifting in the current system has been exaggerated and may account for a small portion of health-care costs. He notes that “it is a manageable problem. According to Jack Hadley and John Holahan of the left-leaning Urban Institute, uncompensated care for the uninsured amounts to less than 3% of total healthcare spending — a real cost, no doubt, but hardly a crisis.”

Tanner has also addressed the implied assumption of health-care reformers that universal health-care insurance will improve the nation’s collective health. He says that “in reviewing all the academic literature on the subject, Helen Levy of the University of Michigan’s Economic Research Initiative on the Uninsured, and David Meltzer of the University of Chicago, were unable to establish a ‘causal relationship’ between health insurance and better health. Believe it or not, there is ‘no evidence,’ Levy and Meltzer wrote, that expanding insurance coverage is a cost-effective way to promote health.” A New England Journal of Medicine article in 2006 likewise found that “health insurance status was largely unrelated to the quality of care.” It seems as though even if we force people to self-insure, they may not wind up much healthier.

In sum, Prevor raises a key point: the fixation on universal health-care insurance has distorted the health-care debate. It might, as he suggests, be a good time to take a step back and see whether the quest for universal insurance is really where we should be focusing our attention. Maybe it is time, as he puts it, to remember that “the moral imperative is not making everyone buy insurance. The moral imperative is freedom.”

Republicans have been tossing out alternatives to government-centric ObamaCare for some time. They have suggested, among other ideas, that we change the tax treatment of individually purchased insurance plans, reform the tort system, and allow interstate insurance sales. But now Jim Prevor raises an interesting and compelling question: if people want to go without insurance and instead self-insure, why is it the government’s job to stop them? Or put differently:

The fact that the national debate has focused on insurance for health care–as opposed to the accessibility of care–is a byproduct of the particular worldview that all “basic needs” should be provided by communal institutions, preferably the government but, alternatively, highly regulated companies that do the government’s bidding.

Prevor suggests that we “give families money or vouchers that they could use to buy health insurance or any other thing they deemed helpful to their family’s future” and urges lawmakers to work on the supply side of care, not insurance, by among other things “wreak[ing] havoc on the American Medical Association’s efforts to restrain the supply of doctors.” Along the lines of Prevor’s argument, one of the more successful ventures in the Bush administration was emphasis on community health centers that expand care for needy Americans, quite apart from the insurance part of the equation. And expansion of medical accounts, which allows individuals to either buy insurance or pay for medical cost directly, would, following Prevor’s argument, maintain personal responsibility, individual choice, and make health-care purchases more accessible by allowing individuals to use pre-tax dollars to pay for their own care.

But what of the “cost shifting” problem caused by uninsured people? Well, now that the Democrats propose to dump millions of people into Medicare, which doesn’t fully compensate doctors and hospitals, it appears as though that argument is going by the wayside. Furthermore, as Mike Tanner of CATO has explained, cost shifting in the current system has been exaggerated and may account for a small portion of health-care costs. He notes that “it is a manageable problem. According to Jack Hadley and John Holahan of the left-leaning Urban Institute, uncompensated care for the uninsured amounts to less than 3% of total healthcare spending — a real cost, no doubt, but hardly a crisis.”

Tanner has also addressed the implied assumption of health-care reformers that universal health-care insurance will improve the nation’s collective health. He says that “in reviewing all the academic literature on the subject, Helen Levy of the University of Michigan’s Economic Research Initiative on the Uninsured, and David Meltzer of the University of Chicago, were unable to establish a ‘causal relationship’ between health insurance and better health. Believe it or not, there is ‘no evidence,’ Levy and Meltzer wrote, that expanding insurance coverage is a cost-effective way to promote health.” A New England Journal of Medicine article in 2006 likewise found that “health insurance status was largely unrelated to the quality of care.” It seems as though even if we force people to self-insure, they may not wind up much healthier.

In sum, Prevor raises a key point: the fixation on universal health-care insurance has distorted the health-care debate. It might, as he suggests, be a good time to take a step back and see whether the quest for universal insurance is really where we should be focusing our attention. Maybe it is time, as he puts it, to remember that “the moral imperative is not making everyone buy insurance. The moral imperative is freedom.”

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The Docs Are Out

Groups that were lured by the White House to dog-and-pony confabs and promised sweetheart deals in exchange for acquiescence on health care have gotten a rude awakening: ObamaCare in its latest incarnation is a terrible bill antithetical to their members’ interests. Well, it’s not like they weren’t warned.

USA Today reports that the Medicare “buy-in” has set off a firestorm from an array of medical groups that have finally figured out what’s afoot:

“Bringing more people into a system that doesn’t work very well is not a good answer,” said Jeffrey Korsmo, executive director of the Mayo Clinic Health Policy Center. “The current Medicare program is not sustainable.” … Many details have not been announced, but the American Hospital Association and the American Medical Association, pounced on a proposal to expand the seniors program because doctors receive less from Medicare than from private insurance for the same procedure. “If more people move into Medicare we’d … bear the financial brunt of this,” said Rich Umbdenstock, president and CEO of the hospital trade group.

Will this opposition from key groups make a difference? Only if senators care about what’s in the bill and whether we’re solving some problem or creating many new ones. And as for those groups that played footsie with the Democratic lawmakers and the White House, it should be a lesson that when liberal politicians come looking for a government-centric health-care “reform” plan, it is best to run the other way and use their resources to educate the public about the dangers of such a scheme (reduced technological innovation, doctor shortages, rationing, medicine by government “experts” rather than medical professionals). Otherwise, patients, hospitals, and doctors are going to wind up the losers.

Groups that were lured by the White House to dog-and-pony confabs and promised sweetheart deals in exchange for acquiescence on health care have gotten a rude awakening: ObamaCare in its latest incarnation is a terrible bill antithetical to their members’ interests. Well, it’s not like they weren’t warned.

USA Today reports that the Medicare “buy-in” has set off a firestorm from an array of medical groups that have finally figured out what’s afoot:

“Bringing more people into a system that doesn’t work very well is not a good answer,” said Jeffrey Korsmo, executive director of the Mayo Clinic Health Policy Center. “The current Medicare program is not sustainable.” … Many details have not been announced, but the American Hospital Association and the American Medical Association, pounced on a proposal to expand the seniors program because doctors receive less from Medicare than from private insurance for the same procedure. “If more people move into Medicare we’d … bear the financial brunt of this,” said Rich Umbdenstock, president and CEO of the hospital trade group.

Will this opposition from key groups make a difference? Only if senators care about what’s in the bill and whether we’re solving some problem or creating many new ones. And as for those groups that played footsie with the Democratic lawmakers and the White House, it should be a lesson that when liberal politicians come looking for a government-centric health-care “reform” plan, it is best to run the other way and use their resources to educate the public about the dangers of such a scheme (reduced technological innovation, doctor shortages, rationing, medicine by government “experts” rather than medical professionals). Otherwise, patients, hospitals, and doctors are going to wind up the losers.

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Any Deal

The apparent deal by 10 senators to drop the public option is a bit baffling. We’re going to get rid of the “public” option but give the option of buying into government-run Medicare to millions? This is going to lower costs and prevent the crowding out of private insurers? Hard to see how. What’s more, we’re going to dump millions more into a program from which we’re contemplating slashing hundreds of billions of dollars.

If nothing else, this has at least woken up the AMA:

The American Medical Association said it opposes expanding Medicare because doctors face steep pay cuts under the program and many Medicare patients are struggling to find a doctor. Hospitals also said expanding Medicare and Medicaid is a bad idea. “We want coverage — in the worst way — expanded, but both of these means are problematic for hospitals and physicians,” said Chip Kahn, president of the Federation of American Hospitals, which lobbies on behalf of for-profit hospitals. “It’s going to make it difficult to make it work.”

The deal has yet to be scored by the CBO, and the details have yet to be explained. But what seems to be going on here is a desperate struggle for a deal, any deal. Doesn’t matter if it makes sense or is paid for or accomplishes the purported goals of its supporters. It’s all about saving face for the Democratic leadership. The question remains whether lawmakers will actually scrutinize the monstrous bill or instead just vote for any old thing their leaders put in front of them.

The apparent deal by 10 senators to drop the public option is a bit baffling. We’re going to get rid of the “public” option but give the option of buying into government-run Medicare to millions? This is going to lower costs and prevent the crowding out of private insurers? Hard to see how. What’s more, we’re going to dump millions more into a program from which we’re contemplating slashing hundreds of billions of dollars.

If nothing else, this has at least woken up the AMA:

The American Medical Association said it opposes expanding Medicare because doctors face steep pay cuts under the program and many Medicare patients are struggling to find a doctor. Hospitals also said expanding Medicare and Medicaid is a bad idea. “We want coverage — in the worst way — expanded, but both of these means are problematic for hospitals and physicians,” said Chip Kahn, president of the Federation of American Hospitals, which lobbies on behalf of for-profit hospitals. “It’s going to make it difficult to make it work.”

The deal has yet to be scored by the CBO, and the details have yet to be explained. But what seems to be going on here is a desperate struggle for a deal, any deal. Doesn’t matter if it makes sense or is paid for or accomplishes the purported goals of its supporters. It’s all about saving face for the Democratic leadership. The question remains whether lawmakers will actually scrutinize the monstrous bill or instead just vote for any old thing their leaders put in front of them.

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