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More Ancient Conservative Giants In Favor Of Universal Care

September 11, 2009

Mike brings up a counter-point in the comments on the earlier post about socialism, Hayek, and universal coverage (thanks for the link, Andrew!):

I think you miss something very important. The danger of government-run insurance is not that it will encourage people to get cancer. It’s that it will — as all such systems have — encourage them to overuse the system. Indeed, this is precisely the problem with the system we have now. Since third parties pay the bills, there is zero incentive or the consumer not to get every fancy test, every exotic procedure and every expensive prescription they can.

This is why socialized medical systems have always had to impose rationing. Because it quickly becomes the only way to hold back costs from growing indefinitely.

This is absolutely true.  Third-party payments must be minimized to control costs as the incentive structure makes demand for medical care inelastic to price changes.

My previous post, though, didn’t endorse the specific proposal put forth by Obama, which is a moral though not a fiscal improvement over the status quo (and still probably worth it).  It instead addresses the misconception that even a full government takeover of health insurance would be a socialist program.  This would be inefficient certainly, but not socialist. The term as so used is meaningless and deaf to the principles put forth by forefathers of conservatism/libertarianism.  My problem with the way the health care debate is being framed is that showing compassion for people who are fully exposed to the risk of disease makes one a pinko commie bastard.

Ok, so if ObamaCare doesn’t totally do it for me, what would be a good alternative?  I’m most persuaded by Milton Friedman’s ideas on health savings accounts, but even he argued that the government should step in and provide baseline catastrophic coverage for all Americans (emphasis mine):

A more radical reform would, first, end both Medicare and Medicaid, at least for new entrants, and replace them by providing every family in the United States with catastrophic insurance (i.e., a major medical policy with a high deductible). Second, it would end tax exemption of employer-provided medical care. And, third, it would remove the restrictive regulations that are now imposed on medical insurance—hard to justify with universal catastrophic insurance.

Milton Friedman, Hoover Digest 2001

Savings accounts aren’t really a popular idea anymore, but the point is that regardless of the specific policy proposed to fix the status quo, it is a moral imperative for our country to guarantee access to health care.  How much care, at what quality, who is paying, whether it should be tied to employers – these are all legitimate points of debate. No position on any of those subjects, however, makes one a socialist.  It can make you a poor policy maker, but not a Trotskyite, Nazi or a traitor.  Which is sad that this needs to be pointed out.

People who don’t believe at least in universal health coverage, whether through mandates to find private insurers, government single-payer, or a hybrid model, have nothing productive to add to the reform discussion.

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5 Comments leave one →
  1. Diana permalink
    September 16, 2009 1:52 pm

    I think the term “rationing” is another one of those hot button terms being used right now to stir emotions. It’s usually used in the same sentence as socialism, such as “socialized medicine will lead to rationing.”

    It is completely routine, and no one blinks an eye, when a healthcare service provider has to get approval from an insurance provider before each and every procedure. How is that different from “rationing?” The guy I know who has had three surgeries for his knee – not so he can walk without pain, but so he can run competitively again – might have to pay for his next surgery out of pocket.

    I think the real scary idea here is “economic equality” when it comes to healthcare. Jim the Executive will have the same access to medical treatment for a heart attack as Jose the Roofer, and instead of big bucks chasing scarce resources, it will be those same resources being spread equally among us all. And if we take away the economic stimulus to create scarcity in order to boost cost, maybe some of those resources would be less scarce.

    The idea of catastrophic health care for all is appealing. However, I’m wondering if equal access to cradle-to-grave healthcare with pre-natal care for pregnant women, routine physicals, vaccinations, etc. would create a healthier population that would have less need for “catastrophic” health care. Catastrophic care is expensive. Cradle-to-grave care is so much less so.

  2. September 25, 2009 3:43 pm

    “People who don’t believe at least in universal health coverage, whether through mandates to find private insurers, government single-payer, or a hybrid model, have nothing productive to add to the reform discussion.”

    Why is this true?

    I believe there is no goal more laudable than supplying every American with adequate health care. I also believe that using the power of government in an attempt to accomplish this is almost certain to fail.

    This is because, like it or not, we do have limited resources and the involvement of government, by nature, is extremely wasteful and extremely narrow and limiting.

    I simply ask why isn’t it possible to provide adequate health care to every American without governmental interference?

    It is perhaps because from a moral standpoint we don’t really care enough about each other to get the job done?

    It costs me about $2,000 a year to provide medical insurance for my three children on the open market.

    If a child can be insured for $700 a year, why aren’t all children in the country ensured right now?

    How many millionaires, from either the left or the right, are currently paying out of their pockets to provide insurance for a child they don’t know?

    My best guess is almost none?

    Why not?

    Why doesn’t President Obama simply ask people to do this first?

    How much of the gap could be closed if he did that?

  3. October 1, 2009 10:35 am

    “The danger of government-run insurance is not that it will encourage people to get cancer. It’s that it will — as all such systems have — encourage them to overuse the system.”

    I disagree with this logic. How is private insurance any different in this regard? It rations care in exactly the same way. As was pointed out with the – oh, what was the name of that article… the comparison between medicare payments in El Paso and the small Texas town (sorry) – government payment does not necessarily encourage overuse. Although we don’t have the same data on private payments as we do with medicare, I think we can all agree that private insurance does indeed ration to limit overuse of services.

    As for the big picture cost, Americans, via private insurance, are paying WAY more for services than other countries. I personally might like to see my HMO do a bit more rationing if it means lowering my sky-high monthly premiums.

  4. Valerie Curl permalink
    February 28, 2010 7:11 pm

    Regarding Health Savings Accounts, I actually like them and would like to see more of them – with larger account account balances allowed pre-tax. However, they plus catastrophic insurance don’t solve the majority of long-lasting, non-critical care. Using myself as an example, I have RA. My father and all of his 7 siblings had RA also. It appears to be have a genetic linkage. The medicine I take costs $1500/mo. or $18,000/yr. Plus I have to have semi-annual blood tests at a cost of about $500 each time. Essentially, I’m looking at medical bills of $20,000/yr.

    Without RA, I’m quite healthy and capable and would require little health care. Just the annual physical basically. But because of RA, there’s no way for me to obtain reasonably priced health insurance.

    Currently, I pay, just for myself, about $14,000/annually for that “high risk” health insurance known as HIPAA. However, as part of a large group the total cost was a bit less than $5,000/annually, including my employers share.

    It’s examples such as mine where the financial side of the arguments get sticky. Spreading out the risk across the spectrum of the population does reduce cost. And it leaves an individual with the ability to purchase other things or have a higher standard of living.

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