At the ripe age of 61, former Johns Hopkins neurosurgeon Ben Carson has seen his fair share of boondoggles.
The good doctor, though, has never seen a disaster quite as large as Obamacare. On Fox News the other day, Carson proclaimed that this “is the beginning of the collapse,” and characterized the mass roll-out as “foolish.” Is this just another instance of Fox News nuttery?
It turns out that there is much to fear in these last few months before the health-exchanges open.
We’ve been told over and over by the administration that the individual mandate is the linchpin that holds the entire reform together. If we had a law mandating that insurance companies offer expensive benefits and provided for the influx of millions of sickly folk without getting the young and healthy on board, prices would see an increase. Then, in a nightmare scenario dubbed by economists as an adverse selection death spiral, the price increase would prompt an exodus of many quasi-healthy folk, leaving only the very sick on the insurance rolls. This in turn would lead to price spikes, leaving only the sickest few as customers.
Think this is an outlandish scenario dreamed up by Sarah Palin? Just look at New York.
The Empire State mandated up the wazoo without a purchase requirement, leading to some of the highest premiums in the country. Keeping this in mind, the administration must find and recruit millions of healthy youth to sign-up for insurance. Given that 32% of the uninsured population is Hispanic and nearly half are under the age of 26, it’s no surprise that enrolling Latinos is a huge priority for the POTUS and co.
Increasing awareness about such a massive undertaking may seem like no big deal, but trusting the government is seldom a solid idea. A government run by angels might efficiently distribute outreach funds, showering money on local groups. Community organizations and health centers in the Hispanic community are instead shortchanged, while an army of federal “navigators” reap all the dough. With an astounding 71% of Latinos unable to name a single provision of Obamacare, the bureaucrats have their work cut out for them.
But even if the government could get their mojo together and spread the word, Obamacare is still destined for failure. The administration’s effort to make competition more robust is creating an environment very difficult for insurance companies to navigate. How can smaller players deal with price controls (“community rating”) and mandated benefit offerings? Our present system features a few players controlling large markets, and health care “reform” will only make it worse. With competition controlled by a few corporate giants, how can we expect to curtail cost?
The recently-passed reforms are said to be bold, but they fail to address the real reason behind insane prices. The key driver of costs is the third-party payer system, where employer Paul covers employee Peter. The health care system in this country is often labeled “free-market” without any real contemplation as to what a marketplace would look like. Whereas the hallmarks of any traditional marketplace include customer control and price competition, our bloated health-care system has neither. We paid a mere 13.7% of our health-care expenses directly, down from 39.6% in 1970. While the rise of other payers like Medicare and Medicare sounds peachy, imagine if we paid such a low percentage out-of-pocket for any other industry. How many unnecessary boxes of Cookie Crisp cereal would you buy if you could pay for your grocery bills through food insurance? Surely the demand for food over the entire system would skyrocket, causing an increase in cost.
It is no secret that there’s chronic overspending in the medical sector. The president of the American Board of Internal Medicine Foundation, Christine Cassel, blames wasteful procedures and testing for a third of our national health-care bill. Liberal analysts are right to discuss the bloated overhead cost of private insurance, and conservatives are right to point out public waste.
We should consider, though, a third alternative: empowering individuals to purchase care outside of insurance programs. Prices would finally be listed at doctor’s offices, as consumers shop around for the lowest cost. The state has every right to incentivize catastrophic care; there can’t be a whole lot of choice when ERs are involved. Help would always be available to those in need, through a generous sliding scale of health tax credits. By rejecting foolish government “solutions,” and instead embracing a system of true choice, we can once again take pride in our medical care.