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Old August 12th, 2009 #81
Alex Linder
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Obama and the Post Office

by Llewellyn H. Rockwell, Jr.

Writing in The State and Revolution in 1917, Vladimir Lenin summed up the economic aim of socialism as follows: "To organize the whole economy on the lines of the postal service...."

Incredible, isn't it? After centuries of treatises and miles of paper and tubs of ink, this is the great historical turning point: government employees carrying sacks of paper mail from house to house, and operating at an economic loss.

It's fascinating how it all comes down to the post office, again and again in the history of public policy. And so it is in our time, with Obama's admission/gaffe/slip concerning the post office and its analogy to what he wants to do with health care.

Here is a transcript of his spontaneous talk at a high school. A student raised a question about the government's provision of health services and its impact on private services.

"How can a private company compete against the government? My answer is that if the private insurance companies are providing a good bargain, and if the public option has to be self-sustaining, meaning that taxpayers aren't subsidizing it, but it has to run on charging premiums and providing good services, and a good network of doctors, just like private insurers do, then I think private insurers should be able to compete.

"They do it all the time. If you think about it, UPS and Fed-Ex are doing just fine. It's the Post Office that's always having problems.... there is nothing inevitable about this somehow destroying the private marketplace. As long as it is not set up where the government is being subsidized by the taxpayers so that even if they are providing a good deal, we keep having to pony up more and more money."

Now, these comments are nothing short of incredible. The Post Office has been on the loser list for many decades. Most recently, it has been included on the GAO's high-risk list, increasing its debt to $10.2 billion and incurring a cash shortfall of $1 billion.

Note that the post office is not being shut down for this mess. On the contrary, it is being subsidized not only with tax dollars but, most importantly, with laws. Title 18 (I.83.1696) says that "Whoever establishes any private express for the conveyance of letters or packets" can be fined and jailed. Moreover, the law (39.I.6.606) says that any letter delivered by unlawful means can be seized and stolen by the government. It is immune from antitrust action and criminal liability. You can read the whole Post Office Gosplan here.

If the Post Office were really a market institution, it would go belly up in about half an hour. So, no, there is no competition here. Only the government is permitted to deliver first-class letters. How do UPS and Fed-Ex get away with it? They slip through a hole in the law by delivering packages, not mail. And it wasn't easy to survive even then. Just as in the 19th century when the federal government waged war on Lysander Spooner's American Letter Mail Company and on Wells Fargo (and Benjamin Tucker defended "private enterprise in the letter-carrying business"), the government has been hounding private services in our time, whether through wicked labor union bullying or by restricting their services as much as possible.

The freedom of UPS and Fed-Ex to operate at all is hard won. But the government has succeeded in destroying the private marketplace in the one area that government monopolizes by law. It took the innovation of digital messaging to finally horn in on that area. And this has worked in a big way, with a massive collapse in the number of people choosing government mails over digital alternatives.

Therefore Obama is right in a strange way: private enterprise has triumphed and government service is terrible. Everyone knows this. It is utterly preposterous that a government mail service exists at all. There is no theory of economics that supports it. There is not now nor has there ever been any economic reason for government postal service. It should be immediately abolished and private enterprise should take over. Even on the basis of Obama's thin and strange statements, you might argue this conclusion.

But perhaps Obama meant to suggest that the reason the Post Office is so bad is because it has to compete with private enterprise. If he meant that, he lives in a socialist fantasy land, and we have a very dangerous man on our hands. In the real world, no living person could possibly believe that mail service would be improved by getting rid of the efficient producers and granting a totalitarian monopoly to a single government-backed provider.

How can a private company compete against the government? Simply because government is so terrible at what it does that even a private company that is beaten down and attacked and competed against with all the tax dollars in the world will do better than the government. It is true in mail and it is true in health care. But what they will not be able to do is thrive to the point of universal service, especially when there are laws that prohibit direct service-by-service competition.

Another point that needs to be addressed is Obama's claim that the government service will operate just like the private service, with self-sustaining financing. But here is the question that socialists have never been able to answer. If the goal is to get government to operate like a private service, what is the value added by having it provided by the government in the first place? The only reason for a government service is precisely to provide financial support for an operation that is otherwise unsustainable, else there would be no point in the government's involvement at all.

And let us set aside the amazing and preposterous claim that if the government service doesn't work according to market principles, it will be shut down. Never in the entire history of government has that been true. No matter how bad, no matter how financially egregious, no matter how much the people suffer, the propensity is for government services to last forever and ever, precisely because they are protected from market-based tests of profit and loss.

The right path to health-care reform is the market path (no subsidies, no monopolies such as drug patents, no licensure, no anything) that tends toward universal distribution at very low prices and relentless improvement in service. The wrong path is to make health care run the same way as the post office. Obama seems to favor the latter path, even though he admits that it is the least well-performing one. This is surely the definition of fanaticism. If the mobs aren't angry, they should be.

Books by Lew Rockwell

August 6, 2009

Llewellyn H. Rockwell, Jr. [send him mail] is founder and chairman of the Ludwig von Mises Institute in Auburn, Alabama, editor of LewRockwell.com, and author, most recently, of The Left, The Right, and The State.

http://www.lewrockwell.com/rockwell/...office126.html
 
Old August 20th, 2009 #82
Alex Linder
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The 47 Million
August 18, 2009

This main arguing point by the libs and demos about the so called 47 million "uninsured" has to stop. Here's the way it works, if one is to be truthful, and the libs and demos aren't, as a general rule.

12-20 million are illegals or to be kind, 'not US citizens.' The libs and demos want to cover them also, but no one else does, so this cuts it down to 27 million.

17 million live in households with large incomes, and could, if they so chose, buy their own health care coverage. This leaves 10 million, 'uninsured.'

18 million are between the ages of 18 and 34, and as is common, are in excellent health, and choose not to buy health coverage. This leave a negative 8 million 'uninsured.'

Furthermore, only 30% of the non-elderly, who are currently uninsured, in any give year, become insured within 12 months.

The 47 million, widely touted as this hideous figure which every true American should shudder at and rush to call their demo representative to pass this socialistic legislation, happens to be a fraudulent figure. No wonder thousands flock to the town halls and scream that they want none of it. They weren't placed there by the local John Birch Society, but are really outraged at Obama's plans, which he has yet to adequately describe, other than with extreme generalities. If we need anything, it is tort reform, so the docs won't have to order endless tests to avoid law suits.

Here's how the Brits solved the problem of people being unable to get prompt care with their system of socialized medicine. They passed a law saying that no one should have to wait more than four hours for emergency treatment at a hospital. Sounds great? Here's what happens: When the hospitals are full, which is usually, the sick wait in ambulances outside the hospital so the 'four hour rule' won't be violated. There's a whole industry of motel like ambulances outside of hospitals with people waiting to be admitted..

It's pretty common for Brits to go to Hungary for medical treatment, rather than wait a couple of years for inferior treatment in the UK, just like the Canadians come here. Docs and dentists have 'quotas' of the number of patients they must treat under the socialized medicine system. Dentists give five minute 'cleanings,' and other inferior treatments, and then, having met their 'quota.' go off to vacation land. Docs can do the same, and the result is that the Brits and Canadians have totally inferior medical and dental care. Heard the many jokes about the Brit's teeth? Guess why?

A recent survey in England, found that one in three family and hospital docs believed that geezers should not be given treatment if the treatment is unlikely to prolong life, and half believe that smokers shouldn't be given bypass surgery.

We're winning people! The demos and libs are in full retreat! Who would have thought that the Obama crew could have reuinited the Republican party! I thought that Republicans were a party of the past, but not a single one voted for the socialized medicine garbage. Keep the pressure on, and maybe the middle of the road Republicans can be brought around to actually represent their constituency. Keep the pressure on, and not just to the Democrats, but to your Republican rep and senator also. Tell them that we want our nation back, and to vote an absolute NO on 'cap and trade,' as well as the health monstrosity. Let them know that if they vote yes on either of them, come the next election, they're out of there, and we'll see to it that they're defeated. Honestly, I am simply delighted that America seems to finally be coming together. Maybe we can get rid of the libs and demos before the next Supreme Court nominee comes before them for a vote.

I think there's no doubt that Obama will be a one term President, if he lasts that long, having been born in Kenya. That little matter is far from dead also, and have you noticed that the White House E- Mail line for people who want to complain about the health care bill has stropped? The outrage of the D.C. Gang collecting names and numbers of protesters stopped that pretty quickly. Fox News has never had such high ratings, and neither has Glenn Beck. There is a light at the end of the tunnel!

http://www.coloradogold.com/archive/...llion-885.html
 
Old August 23rd, 2009 #83
Mike Parker
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Health care debate misses issue of costs

Joe Nation
Sunday, August 23, 2009



Virtually the entire debate over President Obama's health care reform plan now has been reduced to whether there is a public option. Americans would be lucky if the public option were our toughest policy choice. It isn't. The issue - thus far largely ignored by the president and Congress, Sarah Palin and ultra-liberal Democrats who insist on a single-payer policy - is of health care costs.

With health care costs increasing at more than twice the general rate of inflation, any reform that does not adequately address costs will bankrupt both our economy and the U.S. Treasury, and thus ultimately will fail. Health care spending in 2009 will be 17 percent of our gross domestic product, nearly double its level in 1980. Projections suggest it will hit close to 20 percent in 2017.

The most significant and simplest policy to control costs - one that has thus far been rejected by President Obama and the Congress - is to tax employer-provided health care benefits. It is not the only step, but it may be the most important one.

Those benefits disproportionately favor the wealthiest Americans with the most luxurious health plans and cost taxpayers $120 billion each year, according to the Joint Committee on Taxation. The cost to taxpayers increases each year as premiums grow.

Here's how the tax break works: Employee health care benefits are not taxed. Employers deduct these as a business cost, reducing their tax burden. The benefit is the greatest for high-income workers in high tax brackets with "Lexus" health care plans.

The low-income individual, who doesn't receive health coverage paid by his employer, buys a policy with limited benefits - a "Hyundai" plan - after paying taxes on his income. Thus, taxpayers subsidize those with the Lexus plans and the policy penalizes those with the Hyundai plans.

Why must we end this tax subsidy for the wealthiest?

It increases the national debt. The taxpayer-paid subsidy rises as insurance premiums rise (and at a rate well above inflation).

It raises health care costs. It encourages more Lexus health care plans with excessive benefits, and it discourages employees and their employers from holding down health care spending. An excessive plan is one with few or no co-payments, few or no deductibles and little or no consumer responsibility to keep health care costs contained.

Why did the House and Obama cave so quickly on what might be the most important measure in controlling health care costs? Based on my experience in the California Assembly, organized labor probably moved quickly to protect the generous benefits its members receive. Like organized labor, the 85 percent of us with health insurance (the latest estimate from the Census Bureau) benefit from the largesse in today's system and will resist change. But in protecting today's decaying system, we sow the seeds that will bankrupt our own health care coverage in the very near future.

While a move to protect one interest group's benefits is expected from union leaders, it is disappointing to see "progressive" leaders support this reverse-Robin Hood policy under the guise of reform. Instead of taxing health care benefits for all who receive them (or at least above-average benefits), Obama is proposing to raise federal revenues by reducing tax deductions for people who earn more than $250,000 a year. The solution in the House, a surtax of as much as 5.4 percent on couples with more than $1 million in income, is even worse. These two non-solutions add to the federal debt, fail to address the health care equity issue, and do nothing to control health care costs.

Over the next few weeks, liberal lawmakers will insist on the public option; conservatives will reject it, and both will probably continue to ignore the critical issue of containing costs. There are hints of real leadership in the Senate, though. If we are fortunate, the Senate plan might actually tax health care benefits.

If that occurs, we will end the subsidy for the wealthiest and help fund health care for the neediest. In doing so, we will build a foundation for long-term health care reform.

Joe Nation, an economist and a former state Assembly member, teaches public policy at Stanford University.

http://www.sfgate.com/cgi-bin/articl...INDR19B11F.DTL
 
Old August 26th, 2009 #84
Alex Linder
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Obama and Congress want this type of medical care for everyone
Posted by Michael Gaddy on August 25, 2009 07:59 PM

As reported by the Miami Herald, more the 10,000 of our nation’s military veterans were exposed to possibly infectious body fluids while undergoing endoscopic procedures at three different VA hospitals in the Southeast.

Agency officials with the Veterans Administration will answer to serious endoscopic equipment cleaning and sterilization mistakes which affected more than 10,000 veterans at hospitals in Miami, Floirda; Murfreesboro, Tennessee; and Augusta, Georgia. In February 2009, hospital officials began sending letters to thousands of patients, who may have been exposed to HIV and Hepatitis infected endoscopy equipment, urging they receive prompt testing for HIV, Hepatitis C, and Hepatitis B infections. Government officials with the VA reported six veterans tested positive for HIV. The government’s report also indicated 13 positive Hepatitis B infections and 34 positive Hepatitis C infections in patients who were exposed to the infected equipment.

HIV and Hepatitis are viral infections with no known cure and routinely lead to death in infected patients. These viral infections are known to spread through infectious body fluids.

The real crime here is that Congress and various government agencies are in charge of investigating this travesty.
 
Old August 29th, 2009 #85
Mike Parker
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July 10, 2009

‘Rationing’ Doctors’ Pay

By Uwe E. Reinhardt
Uwe E. Reinhardt is an economics professor at Princeton.

My post last week, on the rationing of health care, prompted many commentaries, two of which asked whether reductions in physician fees constitute rationing. A reader named EFW asked:

President Obama is prepared to cut gov’t spending for Medicare and Medicaid. Doctors and hospitals will be paid less for services provided under Medicare. Is that an example of rationing in action?

Lee Beville, a radiologist, also wrote:

The proposed fee schedule for 2010 for radiologists and cardiologists is 21% less than this year! Instead of being reimbursed 36.00 per RVU, CMS proposes to reimburse at 28.00 per RVU. These reductions are the first signs of removing economic incentives for medical practice. There will be few radiologists and cardiologists working after they hit the magical cap number.

Let us be clear about who is rationing what here.

When Medicare reduces its payments to doctors, it rations money to them. It does not directly ration the health care the doctors might render patients.

If physicians refuse to treat patients at the lower fees, it is they who ration health care, even if the incentive to do so came from Medicare.

While I doubt that the payments to radiologists and cardiologists actually will be cut by 21 percent soon — more on that next time — let us suppose it were so. Would there then be “few radiologists and cardiologists working” after such a fee cut?

Presumably, the afflicted physicians would withhold their services only from Medicare and Medicaid patients, assuming that private insurers pay more. But could most radiologists and cardiologists actually earn an adequate livelihood only from privately insured patients? I have my doubts.

Like everyone else, radiologists and cardiologists certainly can claim to be sorely underpaid relative to the extraordinarily high compensation of bankers and corporate executives, which appears to have little correlation with contributions to society. But relative to their colleagues in internal medicine, pediatrics and family practice, radiologists and cardiologists actually are very well paid.

There are a number of sources on physician income (see, for example, this). All of them suggest that the median annual net income of radiologists and of cardiologists (around $400,000) is more than twice that of family practitioners, internists and pediatricians (less than $200,000). The median is a statistic such that half of physicians earn as much as the median or more, and the other half as much or less.

So even if Medicare cut fees of radiologists and cardiologists by 21 percent, the income of these specialists would still exceed that of their colleagues in primary care by 60 percent or more.

Would that be a reason to quit medical practice? After all, doctors are not bankers. They do not work merely for pecuniary gain, but derive nonmonetary, psychic rewards from their jobs.

Coldhearted as it may seem, economists judge a profession’s income as adequate if it attracts enough young people into the profession. For the last half-century that has been so in American medicine. The constraint on the number of American-trained physicians has never been an inadequate supply of eager and qualified American applicants to American medical schools. Instead, it has been a deliberate constraint on the number of American medical-school slots.

For reasons that elude me, United States policy makers and the medical establishment have for decades preferred to deny thousands of eager and qualified American youngsters the opportunity to study medicine and have then met the resulting shortage of physicians by importing foreign-trained physicians from other countries.

But while there is no overall shortage of qualified young Americans eager to study medicine, there is now a nationwide lament over a shortage of American medical school graduates willing to enter the primary care specialties. For that reason Medicare may soon substantially increase the fees for primary care physicians, assuming private insurers will swiftly follow suit, as usual.

The only question then is whether such fee increases will come at the expense of taxpayers or from other parts of the health care sector, perhaps even the more highly paid medical specialties, including radiology and cardiology. That is a political call.

In subsequent posts to this blog I shall explore whether, through the good offices of the Congress, United States taxpayers have been too stingy vis à vis the medical profession.

I shall also describe a highly ritualistic and entertaining form of Kabuki theater staged annually in Washington in conjunction with the year’s Medicare fee update.

Act I in the play is always the announcement of a 20 percent cut in the fees Medicare pays physicians.

That “cut” actually ends up as a increase of 1 to 2 percent and an annual increase in Medicare spending per Medicare beneficiary on physician services of 5 to 6 percent.

It will be so again this year.

http://economix.blogs.nytimes.com/20...-doctors-make/
 
Old September 2nd, 2009 #86
Alex Linder
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A People’s Town Hall
Posted by James Ostrowski on September 1, 2009 10:52 PM

I am speaking tomorrow (Wed.) at a town hall meeting in East Aurora, NY, Millard Fillmore’s home town. Our local congressmen have been MIA in the health care debate so we scheduled our own and invited them but they stiffed us. Here are my remarks on health care:

On health care, the key point is that government creates its own demand. Every prior government intervention into the free market created problems that led to ever more government interventions, culminating in partially-socialized medicine in the 1960’s with the creation of Medicare and Medicaid. M & M have spent trillions without producing any obvious improvement in health. Take a look at life expectancy charts for the last 100 years and see if you can find when M & M came in.

On the contrary, there is an epidemic of obese poor kids with diabetes and there are millions of elderly on so many drugs they can’t think straight and who need to take extra drugs to fight the side effects of the other ones. Other unintended consequences of these programs are bidding up the price of health care and introducing all that maddening paperwork into the system.

So, as with every other big government program, partially socialized medicine has failed. The solution is not to jump off the cliff of fully socialized medicine nor is the status quo acceptable. As Ludwig von Mises pointed out, we can’t do nothing because the mixed economy we have now is always moving towards socialism. Have you noticed?

So, the only possible solution to this mess is to move toward a free market in health care and do so immediately! End the cartels, the monopolies, the regulations, the subsidies, and the licensing schemes.

Remember what Milton Friedman said 45 years ago: “The American Medical Association is perhaps the strongest trade union in the United States. The essence of the power of a trade union is its power to restrict the number who may engage in a particular occupation.”

So, we give legal monopolies to doctors and hospitals and insurance companies and then we wonder why their prices are so damn high! I have a better idea. There are town hall meetings all over the country to deal with the problems in health care, one of the most highly regulated and subsidized industries in America. What is the least regulated industry in America? Computers and electronics. There, the free market delivers cheaper and better goods and services every year and not a single public meeting has ever been called to express dissatisfaction with that amazingly productive free market industry.

On health care, let’s try freedom. It works. Nothing else does.

http://www.lewrockwell.com/blog/lewr...tml#more-34782
 
Old September 3rd, 2009 #87
Alex Linder
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[from LRC blog]

On Doctors Serving The State
Posted by Kathryn Muratore on September 2, 2009 06:05 PM

Writes an LRC reader in response to my earlier post:

Thanks for the comments. Agreed. I am a doctor. I have a “no third-party” office. I only take money from the patients I treat. That’s the way it should be. It is ethical and highly satisfying and keeps me honest. If my patients don’t think my service is worth what I charge, then they don’t see me. Simple.

It is also a very good business model. I have very low overhead, no hassle, no confusion about co-pays, deductibles, formularies, referral authorizations, HIPPA compliance, CPT codes, audits…. Augh.
My prices are posted. I discuss the cost before any procedure or treatment. They are reasonable and honest. If it is an emergency, we treat first and then discuss costs later. It almost always works out fine. How anybody could practice medicine the way I used to is now beyond my comprehension.

Doctors who on the one hand decry the poor payment of MCR yet on the other hand (ab-)use the system to make more money year after year (doctor’s salaries continue to go up) and at the same time become more dependent on it are irrational and hypocritical.

I see MCR patients and tell them it costs $50, cash, credit or check. They like it.
 
Old September 3rd, 2009 #88
Alex Linder
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[from LRC blog]

On Doctors Serving The State
Posted by Kathryn Muratore on September 2, 2009 06:05 PM

Writes an LRC reader in response to my earlier post:

Thanks for the comments. Agreed. I am a doctor. I have a “no third-party” office. I only take money from the patients I treat. That’s the way it should be. It is ethical and highly satisfying and keeps me honest. If my patients don’t think my service is worth what I charge, then they don’t see me. Simple.

It is also a very good business model. I have very low overhead, no hassle, no confusion about co-pays, deductibles, formularies, referral authorizations, HIPPA compliance, CPT codes, audits…. Augh.
My prices are posted. I discuss the cost before any procedure or treatment. They are reasonable and honest. If it is an emergency, we treat first and then discuss costs later. It almost always works out fine. How anybody could practice medicine the way I used to is now beyond my comprehension.

Doctors who on the one hand decry the poor payment of MCR yet on the other hand (ab-)use the system to make more money year after year (doctor’s salaries continue to go up) and at the same time become more dependent on it are irrational and hypocritical.

I see MCR patients and tell them it costs $50, cash, credit or check. They like it.
 
Old September 15th, 2009 #89
Alex Linder
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Even Canadians Are Waking Up . . .
Posted by Thomas DiLorenzo on September 14, 2009 01:04 PM

. . . to the systemic awfulness of socialized healthcare, writes Canadian Cathy LeBoeuf-Schouten ([email protected]). After publishing an article on LewRockwell.com entitled. “My Canadian Healthcare Horror Stories,” Cathy discovered that the article had elicited 27,000 hits from all over the Canadian blogosphere. The article produced “a cascade effect” of other Canadians sharing their socialized healthcare stories, she wrote me. She appeared on several state radio (CBC) shows where she “got across many points that I have seen raised on LewRockwell.com, by people such as Hans-Hermann Hoppe, Walter Block, Tom DiLorenzo et al,” and the CBC host even promoted her article from LewRockwell.com.

“The turmoil of the American debate on healthcare has percolated up to us,” she writes. “People are now sharing horror stories and realizing that the awfulness is systemic. My [American] friends, take this as proof that no matter what your government may say about Canadians’ general satisfaction with their socialized medicine, there is huge dissension and people are looking for alternatives.”

Who knows, Canadians may move in the direction of healthcare freedom while Americans embrace the totalitarian alternative.
 
Old September 15th, 2009 #90
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My Canadian Healthcare Horror Stories
A Message for Americans

by Cathy LeBoeuf-Schouten

I was born in the same year that my government adopted socialized healthcare in Canada. I am an educated, middle-class woman and I have never known any kind of healthcare but the kind that is provided by our government-run system. It has been a nightmare for my family and me. The following stories, told in second person and based on my personal experiences with socialized healthcare in Canada, constitute my personal warning to Americans.

Imagine that you and your spouse, and three children under the age of six move to a new city and must find a family doctor. You are told at the local clinic that the doctors there are not accepting any new patients. (Canadian price controls have created shortages of everything when it comes to healthcare). The receptionist suggests that you go through the yellow pages and try to find a physician whose practice is not "full." You spend days, and weeks, doing this, and are repeatedly told "Sorry, we are not accepting new patients." You put your name on several waiting lists and persist in calling doctors’ offices.

Finally, a receptionist tells you that, while the doctor is still accepting new patients, he requires a full medical history and an interview with each family member before you can be added to his roster of patients. Based on the questions asked during the interviews, you come to understand that he is screening out sick or potentially sick people. You are all healthy, fortunately, so he takes you on as patients. Others are just out of luck.

There is a chronic shortage of doctors in Canada because price controls on doctors’ salaries have resulted in a "brain drain" where the best and brightest practice medicine in the U.S. and elsewhere, after being educated in Canada. In addition, the Canadian government cut medical school enrollment in half in the 1990s as a "cost-cutting measure," making the problem of doctor shortages much worse.

Next, imagine that all of a sudden your six-year-old begins showing what seems to be signs of an appendicitis attack, shortly after recuperating from chicken pox. You take him to a hospital emergency room and carry him in because he is unable to walk. There is no one to help you as you enter the building, so you must lumber along to the reception area. A nurse interviews you for a couple of minutes, asks you for the reason for your visit, and then takes your son’s government health card and asks you to fill out paperwork while your son writhes in pain in your lap.

You tell the nurse that your son must be seen by a doctor immediately – it’s an emergency! – as his condition is worsening by the minute. The nurse tells you, stone-faced, to go and sit in the waiting room to wait for a triage nurse. Having no choice, you do what you are told and join twenty or so others in line in front of you. You are given nothing to help make your son more comfortable – no damp facecloth, no bedpan for the vomit, nothing.

When a triage nurse finally strolls in a half hour later your son is too weak to respond to her and you begin to panic. Finally, a doctor appears and says it’s just a "bug" and that you should not be playing "armchair doctor" by "diagnosing" appendicitis. He orders some time-consuming tests anyway, because you have shown him that you are very, very angry. Six hours later the test results come back positive for appendicitis.

Your son is whisked away for an emergency appendectomy, after which the surgeon tells you that, had the surgery been delayed by another few minutes, he would probably have died. Your son’s appendix was gangrenous and on the verge of bursting. It reminds you of reading in the local news of three other people who were sent home from the emergency room, only to have their appendices burst and die. You are grateful that you were much more persistent and ornery than they apparently were.

Our Soviet-style emergency rooms have waiting rooms equipped with hard metal chairs, vending machines that sell junk food, and maybe a television in one corner. There is no access to any medical equipment, beds, or even stretchers. In the emergency room everyone passes through triage and is given a code based on a nurse’s cursory evaluation of their affliction. If you are not satisfied with the "care" that is provided there is nowhere else to go, except to an American hospital if you are close enough to the border and can afford to pay cash. Canadians know that if you call an ambulance you can bypass the 10–12 hour wait in the emergency room, but this drives up the costs of healthcare even further.

If there ever was a good fight, Americans, this is it. As we say in Canada, "Youse guys just gotta give ’er, eh!

August 11, 2009

Cathy LeBoeuf-Shouten lives in Hudson, Quebec, Canada.

http://www.lewrockwell.com/orig10/le...schouten1.html
 
Old September 15th, 2009 #91
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If eugenics were possible, it would be ideal to raise the lowest White IQ to the point that the carrier understood government medicine is a bad idea.
 
Old September 18th, 2009 #92
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To Cut Healthcare Costs, Let's Start With the Secret Prices

When a colonoscopy ranges from $450 to $10,000, there's room for plenty of savings

By Bernadine Healy, M.D.
Posted September 15, 2009

As President Obama said again in his recent address to Congress, an imperative for health reform is containing runaway health costs. But the elephant in the room that is a real driver of costs is something few people are talking about: the variable and hush-hush pricing of medical goods and services, set by the government or negotiated by insurers and largely kept secret from the patients ultimately responsible for their bills.

Look at a colonoscopy: When paid by Medicare, the fee is roughly $450. Insurance companies secretly negotiate a maze of different prices, generally two to five times that. But as the trade group America's Health Insurance Plans recently reported, patients who have to pay their own bill because they are uninsured, are seeking care outside of their insurer's network, or their insurer has denied their claim, can face retail charges as shameless as $10,000. And how can it be that Medicare pays $40,000, prix fixe, for the same heart operation, by the same doctor, at the same hospital, that costs patients paying privately $80,000 to $120,000?

Consumers' ignorance of what services truly cost blurs the connection between their rising insurance premiums and prices, setting the stage for those prices to soar ever higher. Little wonder that the country's total health costs—for public programs like Medicare and Medicaid, private insurance, and out-of-pocket payments—are twice those of other developed countries. Making prices transparent so they can be compared and giving patients the means to shop for insurers that will get them the best deals would put downward pressure on prices and bring sustainable cost savings.

Instead, Americans are led to think that what's mainly to blame for out-of-control costs is their own voracious overconsumption. So cutting down on the quantity of medical services used by the sick and reallocating dollars for wellness and prevention sound like definite cost savers. But that ignores a few facts. Compared with people in other developed countries, Americans see doctors less often and take fewer medications. They also spend the same or fewer number of days in hospitals, and they already lead the world in expenditures per capita on prevention and public health. Yes, more high-tech care may be given to the sick in this country, and yes, that contributes to higher costs. But whether it's low- or high-tech care, what is achingly obvious is that total costs are a function of prices. Ours are the highest.

[See how crafty insurers are denying care.]

As a classic 2003 report in the journal Health Affairs put it simply: "It's the Prices, Stupid." In their detailed analysis of health spending in 30 developed countries, leading health economists including Gerard Anderson of Johns Hopkins Bloomberg School of Public Health and Uwe Reinhardt of Princeton University determined that the greater cost of care in the United States was due to much higher prices for virtually all of its medical goods and services.

Our senior citizens must have read that study a few years back when they boarded buses to Canada to buy prescription drugs for half the prices they would pay here. Who stopped their burgeoning tea party? The federal government, citing safety concerns, with heavy pressure from the pharmaceutical interests intent on protecting the higher prices Americans are effectively forced to pay.

We are just beginning to see snippets of such comparative price information become more public in other medical areas, prompted no doubt by the growing out-of-pocket payments besetting insured patients. Just last month, a report initiated by Gov. Tim Pawlenty provided price and quality information on 100 medical services from centers throughout Minnesota. Prices were all over the map. The average for colonoscopies ranged from $325 to $1,354. The price of a simple blood count varied from $13 to $85. The wide variation for these and the other prices disclosed suggests lots of room for competition and cost savings. Another area where scrutiny is needed to understand skyrocketing outpatient bills is that of wildly varying and increasingly common "facility fees." A cardiac stress test, for example, can vary by thousands of dollars depending on the size of this tacked-on fee—a charge for the use of a room needed for less than an hour.

To turn these surprising revelations into useful information that can guide and reward patients for getting the best value for their healthcare dollar, prices have to be widely accessible and easily compared before care is rendered. One way to do this might be to expand the concept of the proposed health insurance exchange, which currently would be restricted to the uninsured. Allow for public and private exchanges, and make them open to all individuals who want to purchase insurance anywhere in the country at the best price. And make exchanges vehicles for price transparency, where consumers could get access to comparative and customary pricing information and then hold insurers' feet to the fire by selecting the company with the best available prices at the places they want to go.

[Instead of wholesale health reform, why not fix insurance first?]

The power of making medical prices transparent to the public has not been lost on the political establishment. Indeed, Sens. Charles Grassley and Arlen Specter have pushed legislation to require price disclosures in the private sector, where secrecy clauses between hospitals and manufacturers have been shown to double or triple the cost of medical devices for some patients. Meanwhile, it may surprise the public to know that the government has gone to great lengths to keep the rock-bottom prices it demands quiet, including entering into contracts with industry that make the prices Medicare and Medicaid pay for prescription drugs, say, inviolable trade secrets.

Why? Congress, as laid out in a 2007 letter from the Congressional Budget Office, recognizes that such disclosures would enable private insurers and their customers to be more insistent about getting similar pricing deals, making their own small discounts, and the government's large ones, converge toward an average. While this would lower costs for people with private insurance, it would make government prices—and costs—a bit higher. Disclosure has still not happened.

But if health reform is supposed to reduce costs, disclosing prices and enabling and incentivizing individuals to seek out the best value to serve their needs is a way to do that as a first step—and before making efforts to restrict or redirect care. I'd estimate a good 10 percent of total costs could be taken out of the system quickly, to the benefit of those in both private and public plans.

http://health.usnews.com/articles/he...et-prices.html
 
Old September 18th, 2009 #93
Mike Parker
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Health Care Deceit

By Paul Craig Roberts

The current health care "debate" shows how far gone representative government is in the United States. Members of Congress represent the powerful interest groups that fill their campaign coffers, not the people who vote for them.

The health care bill is not about health care. It is about protecting and increasing the profits of the insurance companies. The main feature of the health care bill is the "individual mandate," which requires everyone in America to buy health insurance. Senate Finance Committee chairman Max Baucus (D-Mont), a recipient of millions in contributions over his career from the insurance industry, proposes to impose up to a $3,800 fine on Americans who fail to purchase health insurance.

The determination of "our" elected representatives to serve the insurance industry is so compelling that Congress is incapable of recognizing the absurdity of these proposals.

The reason there is a health care crisis in the US is that the cumulative loss of jobs and benefits has swollen the uninsured to approximately 50 million Americans. They cannot afford health insurance any more than employers can afford to provide it.

It is absurd to mandate that people purchase what they cannot afford and to fine them for failing to do so. A person who cannot pay a health insurance premium cannot pay the fine.

These proposals are like solving the homeless problem by requiring the homeless to purchase a house.

In his speech Obama said "we’ll provide tax credits" for "those individuals and small businesses who still can’t afford the lower-priced insurance available in the exchange" and he said low-cost coverage will be offered to those with preexisting medical conditions. A tax credit is useless to those without income unless the credit is refundable, and subsidized coverage doesn’t do much for those millions of Americans with no jobs.

Baucus masquerades as a defender of the health impaired with his proposal to require insurers to provide coverage to all comers as if the problem of health care can be reduced to preexisting conditions and cancelled policies. It was left to Rep. Dennis Kucinich to point out that the health care bill ponies up 30 million more customers for the private insurance companies.

The private sector is no longer the answer, because the income levels of the vast majority of Americans are insufficient to bear the cost of health insurance today. To provide some perspective, the monthly premium for a 60-year old female for a group policy (employer-provided) with Blue Cross Blue Shield in Florida is about $1,200. That comes to $14,400 per year. Only employees in high productivity jobs that can provide both a livable salary and health care can expect to have employer-provided coverage. If a 60-year old female has to buy a non-group policy as an individual, the premium would be even higher. How, for example, is a Wal-Mart shelf stocker or checkout clerk going to be able to pay a private insurance premium?

Even the present public option--Medicare--is very expensive to those covered. Basic Medicare is insufficient coverage. Part B has been added, for which about $100 per month is deducted from the covered person’s Social Security check. If the person is still earning or has other retirement income, an "income-related monthly adjustment" is also deducted as part of the Part B premium. And if the person is still working, his earnings are subject to the 2.9 percent Medicare tax.

Even with Part B, Medicare coverage is still insufficient except for the healthy. For many people, additional coverage from private supplementary policies, such as the ones sold by AARP, is necessary. These premiums can be as much as $277 per month. Deductibles remain and prescriptions are only 50% covered. If the drug prescription policy is chosen, the premium is higher.

This leaves a retired person on Medicare who has no other retirement income of significance paying as much as $4,500 per year in premiums in order to create coverage under Medicare that still leaves half of his prescription medicines out-of-pocket. Considering the cost of some prescription medicines, a Medicare-covered person with Part B and a supplementary policy can still face bankruptcy.

Therefore, everyone should take note that a "public option" can leave people with large out-of-pocket costs. I know a professional who has chosen to continue working beyond retirement age. His Medicare coverage with supplemental coverage, Medicare tax, and income-related monthly adjustment comes to $16,400 per year. Those people who want to deny Medicare to the rich will cost the system a lot of money.

What the US needs is a single-payer not-for-profit health system that pays doctors and nurses sufficiently that they will undertake the arduous training and accept the stress and risks of dealing with illness and diseases.

A private health care system worked in the days before expensive medical technology, malpractice suits, high costs of bureaucracy associated with third-party payers and heavy investment in combating fraud, and pressure on insurance companies from Wall Street to improve "shareholder returns."

Despite the rise in premiums, payments to health care providers, such as doctors, appear to be falling along with coverage to policy holders. The system is no longer functional and no longer makes sense. Health care has become an incidental rather than primary purpose of the health care system. Health care plays second fiddle to insurance company profits and salaries to bureaucrats engaged in fraud prevention and discovery. There is no point in denying coverage to one-sixth of the population in the name of saving a nonexistent private free market health care system.

The only way to reduce the cost of health care is to take the profit and paperwork out of health care.

Nothing humans design will be perfect. However, Congress is making it clear to the public that the wrong issues are front and center, such as the belief of Rep. Joe Wilson (R-SC) and others that illegal aliens and abortions will be covered if government pays the bill.

Debate focuses on subsidiary issues, because Congress no longer writes the bills it passes. As Theodore Lowi made clear in his book, The End of Liberalism, the New Deal transferred law-making from the legislative to the executive branch. Executive branch agencies and departments write bills that they want and hand them off to sponsors in the House and Senate. Powerful interest groups took up the same practice.

The interest groups that finance political campaigns expect their bills to be sponsored and passed.

Thus: a health care reform bill based on forcing people to purchase private health insurance and fining them if they do not.

When bills become mired in ideological conflict, as has happened to the health care bill, something usually passes nevertheless. The president, his PR team, and members of Congress want a health care bill on their resume and to be able to claim that they passed a health care bill, regardless of whether it provides any health care.

The cost of adding public expenditures for health care to a budget drowning in red ink from wars, bank bailouts, and stimulus packages means that the most likely outcome of a health care bill will benefit insurance companies and use mandated private coverage to save public money by curtailing Medicare and Medicaid.

The public’s interest is not considered to be the important determinant. The politicians have to please the insurance companies and reduce health care expenditures in order to save money for another decade or two of war in the Middle East.

The telltale part of Obama’s speech was the applause in response to his pledge that "I will not sign a plan that adds one dime to our deficits." Yet, Obama and his fellow politicians have no hesitation to add trillions of dollars to the deficit in order to fund wars.

The profits of military/security companies are partly recycled into campaign contributions. To cut war spending in order to finance a public health care system would cost politicians campaign contributions from both the insurance industry and the military/security industry.

Politicians are not going to allow that to happen.

It was the war in Afghanistan, not health care, that President Obama declared to be a "necessity."

Paul Craig Roberts [email him] was Assistant Secretary of the Treasury during President Reagan’s first term. He was Associate Editor of the Wall Street Journal. He has held numerous academic appointments, including the William E. Simon Chair, Center for Strategic and International Studies, Georgetown University, and Senior Research Fellow, Hoover Institution, Stanford University. He was awarded the Legion of Honor by French President Francois Mitterrand. He is the author of Supply-Side Revolution : An Insider's Account of Policymaking in Washington; Alienation and the Soviet Economy and Meltdown: Inside the Soviet Economy, and is the co-author with Lawrence M. Stratton of The Tyranny of Good Intentions : How Prosecutors and Bureaucrats Are Trampling the Constitution in the Name of Justice. Click here for Peter Brimelow’s Forbes Magazine interview with Roberts about the recent epidemic of prosecutorial misconduct.

http://www.vdare.com/roberts/090913_healthcare.htm
 
Old October 21st, 2009 #95
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Your Doctor Serves The State, Not You

by Michael Scott, MD

As a physician thoroughly frustrated with our State medical apparatus, I read a large number of opinion pieces and news articles on its perceived woes and proposals for its reform. Though I have read some excellent works on these pages and at the Mises Institute site, the majority found in the popular media reek of economic ignorance and worship of the State. Most private physicians knowingly groan when they encounter such garbage, and simply go about the business of their day caring for the sick in the often impossible system which they find themselves. In sharp contrast, many in academic medicine and professional societies such as the AMA cheer, spread it amongst their colleagues, and write additional State-supporting propaganda, the latest of which to come to my attention was the proverbial straw for this camel, and from which I include a particularly remarkable quote:

"It would be such a shame if we once again fail to cover the uninsured because of hang-ups over costs. Physician decisions drive the majority of expenditures in the US health care system. American health care costs will never be controlled until most physicians are no longer paid fees for specific services."

So begin the fantasies of yet another healthcare dictator in the making, proceeding to issue his decree specifying exactly which types of medical services should and should not be provided in this country. At the stroke of his mighty pen, many common services demanded by patients are restricted or (even better) prohibited. Today he limits his list to seven broad categories, including coronary bypass, angioplasty and stenting, prostate cancer screening and treatment, mammography, and CT/MRI (which he interestingly refers to as "art forms"). Tomorrow, who knows which unthinkable ways he will devise to save money for his benefactor the State. Forget the decisions of millions of patients and physicians across the country, they're wrong, all wrong. After all, unlike us common grunts providing the care he seeks to limit, he has the proper credentials! He's used his medical degree to specialize in pathology, work as a professor, laboratory director, journal editor and now "serves" as President and Chair of the Board of The Lundberg Institute, named for himself, whose mission is to "forge a patient-physician alliance based on trust, providing leadership, strategies, and communications that promote evidence-informed, efficient, and effective health care delivery to benefit the health and well-being of patients, physicians, and the public." While possessing a truly impressive résumé in the academic world, it is woefully devoid of virtually any experience in that one often messy matter which is the essence of the profession: actual face-to-face contact with living, breathing patients. To summarize, perfect for our newest Czar.

One would understandably be excused for choosing not to read his decree in full, but near its end we are blessed with another treat. "Academic medical centers should take the lead, rather than continuing to teach new doctors to 'take the money and run'." Yup, yet again, he's spot on! After all, that's the exact take-home message I got during my seven years of exhausting around-the-clock education and training at academic medical centers. Ethics? Nope. Squeeze those sick suckers for all they're worth, their health be damned! Never mind that during most of those seven years my colleagues and I could have been pocketing six-figure salaries in law or six-plus-figure bonuses on Wall Street rather than accumulating education-related debt. Maybe some physicians don't resent his (and our President's) accusations that we base our clinical practice decisions purely or even primarily on income, but I sure do.

While I agree that physicians commonly order tests and perform procedures that are medically unnecessary, this fact is due to two main reasons the author completely fails to mention: first, the tort system, which terrorizes doctors in their practices on a daily basis, and second, that patients have minimal if any financial stake in their care. As a consequence, they demand everything in excess, and are often angry when we suggest a desired test or treatment is not indicated, no matter how much time we spend trying to educate them. When people don't pay for something with their own money, they hardly care about costs. They just milk others for all they're worth, because after all, that's what they perceive everybody else is doing to them, too.

Physicians have two options. We either serve the patient, which increases costs primarily to the State (for many physicians, it is the largest payor), or serve the State (and insurance companies) by limiting care and in so doing expose ourselves to increased customer ire and legal risk. For most, the choice is easy. Others, often rather conveniently insulated from such issues as customer preferences, anger, reimbursement, and legal risk, resort to utopian fantasy and contorted illogic to justify their servitude to the State, all while concealing their wolf-like aggression in the sheep's clothing of nonsensical platitudes such as the mission statement of the institute quoted earlier.

It is not our responsibility as physicians to deny access or limit desires, other than by informing patients of risks and benefits, sticking to our oath to do no harm, and by charging a fair price. If someone wants to spend many thousands of dollars of their own money on larger breasts, that's their business. Only they can judge if the money and the risk of surgical complications including anesthesia-related death is worth the benefit of a new bra size. However you might disagree, you have no right to decide for them. Incidentally, such cosmetic procedures are one of the few areas in medicine where costs have been driven ever lower as quality only improves. The reason? Plastic surgeons generally only accept patients who actually pay the price they mutually agree upon, compared to the majority of physicians who must accept State-mandated rates (and frequently no payment whatsoever) in exchange for the "benefit" of additional paperwork, regulation, and clipboard-carrying overseers. Essentially, free market vs. State market.

Referring back to the initial quote, if physicians aren't paid fees for services, then what exactly should we be paid for instead, and by whom? A flat salary for providing "healthcare" from the State, or from some State authorized co-op or State-regulated "insurance" company? For checking the right boxes on a form, for adhering to scientifically absurd "best practice" guidelines, for incentives to keep a patient healthy and out of the hospital no matter how many packs per day he smokes or motorcycles he chooses to crash while riding drunk and unhelmeted? Yeah, that'll work. Well, it might, if we just outlaw alcohol, and cigarettes, and motorcycles, and stupidity.

Here are some parallels that expose the utter ridiculousness and complete ignorance of economics revealed by his claim:

1. American plumbing costs will never be controlled until most plumbers are no longer paid fees for specific services.
2. American grocery costs will never be controlled until most stores are no longer paid fees for specific foods.
3. American computing costs will never be controlled until most technology companies are no longer paid fees for specific products.

Oh, imagine how much better it would be if plumbers, groceries, and tech companies were instead paid by the State to provide equal access for all Americans to their products and services!

Would expenses skyrocket, because plumbing, groceries, and computers would be "free," and people would demand all the toilet-unclogging, truffle-eating, and number-crunching that other peoples' money can buy? No! Instead, by Dr. Lundberg's reasoning, demand would skyrocket because plumbers, grocers, and electronics stores "drive the majority of expenditures!" The customers (citizens, serfs, proles) are clueless! They care nothing about price, they care nothing about quality, they care nothing about risks or opportunity costs, they are too stupid to know anything at all! They just do whatever the greedy grocer tells them, such as "BUY MORE SPINACH!!! HA, HA, HA, HA!!!" So, of course, we must take care of them.

So how could costs be controlled? How could the State achieve its aims? Just how exactly would it work? Simple, a bureaucrat or even better a "blue-ribbon" panel of bureaucrats would get to declare that no one needs more than 2 GB of memory on his computer, or more than 3 apples per week, or a toilet with more than 1 gallon per flush (OH WAIT! They ALREADY dictate that to us!). Of course, any APPROVED graphic designers, or bakers, or influential friends in high places could obtain special State permission for an exception, even through lobbying and "donations" if necessary. And going further, that such important items as these must pass rigorous State standards and regulations, and therefore can only be purchased from licensed entities such as Halliburton Computer Company, or Goldman Sachs Apple Orchards, or General Motors Plumbing! See how the web of power and control works! Of course, prices could not be allowed to rise, so the plumber would be paid no more than $50 for unclogging a toilet, the grocer no more than $0.25 per apple, the tech company no more than $200 per desktop computer.

How would the plumber, the grocer, and the tech company respond? Would they bask in the glow of the State's beneficence? Perhaps, shielded from competition with their executives ensconced in Aspen or St. Martin, but they'd still plumb fewer toilets, grow fewer apples, and make the crappiest computers you've ever had the pain of trying to use, while customers remained on waiting lists for months just for the chance to redeem their quota. In disgust, their best employees might even decide to take up carpentry instead. In fact, about half of physicians in a frequently cited though controversial poll have admitted considering similar measures if another thousand or so pages of preposterous power-grabbing healthcare law is passed in the near future. Admittedly, I don't think half will quit, but in my circles the number making such considerations, particularly to cut back their practices significantly while exploring other career options far exceeds half.

Forget freedom, forget choice, forget customers actually informing themselves about what they do or do not wish to purchase with money they have actually earned themselves, all because many in this country have been brainwashed into believing that our so-called "free market" doesn't work, is broke, kaput, out of service, and that the classic conception of individual rights is helplessly passé, replaced instead with their newfangled "progressive" misconception of rights such as a right to healthcare, a right to affordable housing, a right to food, and a right to whatever anybody wants anytime (except when it costs too much, whereby your rights will be modulated by your rulers to fit their budget!).

Some other essential points to round out the picture while I'm at it:

1. State "insurance" is not insurance. It is money taken by force from some to pay for the medical care of others. In the case of Medicare, it is also money taken by force from some to pay for their own care, though they may very well prefer to use said money for other purposes. This is wrong. Period. Arguing for expansion of such programs is therefore also wrong. If Medicare were an insurance company, it would be out of business, or its executives in prison, or both.
2. Most private insurance is not insurance (health savings accounts coupled with high-deductible plans excepted). It is prepaid care, or care paid for by a third party, usually an employer. Insurance does not usually cover routine expenses (e.g. homeowner's doesn't cover window washing, auto doesn't cover tire changes). Insurance is a voluntary agreement whereby an individual pays a portion of current resources in order to protect against a potential future large loss. The reason private medical payment is structured in such an unnatural way is a direct result of the employer tax-deductibility of health insurance, which has been in effect since the World War II era as a direct consequence of State price and wage controls. True insurance, such as HSAs, tends to reduce costs compared with State programs, as Whole Foods CEO John Mackey has explained recently to much liberal consternation.
3. We are not operating in a medical free market, or anything that comes anywhere close to approximating one. When the State already spends approximately half of all healthcare dollars, we are operating in a half-socialized market. When the State endlessly regulates providers and payors, and engineers a system where employers rather than patients pay for "private" care, we have even less of a free market.

State interference in the free market is the number one reason for the cost problem in healthcare. It has increased demand through programs such as Medicare and Medicaid, and by making even those with private insurance relatively unconcerned about prices. It has also limited supply through professional licensing laws, patents, certificate of need requirements, and other innumerable regulations. The State, not physicians, is "driving the majority of expenditures in the US health care system."

In the absence of State intervention, charity care would be provided, and in abundance. The uninsured and the indigent would have a place to go, to be cared for, even more so than they do today. Imagine, if the State stole less of your income, if it deprived you of less of your life, if it regulated and ruled you less, if you were faced with gratitude rather than entitlement, would you be more or less likely to contribute to charity, and to provide charitable care?

Medicine is not fundamentally different from any other product or service. Medical services have a monetary value. Consumers can be educated on the value of medical services. If they can learn about such esoteric concepts as computer memory, processor speed, hard disk size, monitor resolution, internet bandwidth, etc., then they sure can learn about the risks and benefits of prostate surgery. Physicians are just one of the many sources of education for them. The internet is the great equalizer and educator.

The only reform that isn't some scheme to increasingly violate individual rights in a vain and misguided attempt to defy the laws of economics, which is to say our essential human nature, is to free (repeal State programs and regulations) rather than to even further socialize medicine.

October 21, 2009

Michael Scott [send him mail] is an emergency physician practicing in the Southeast. He likes tinkering with electronic gadgets, getting in over his head with home improvement, and dogs.

http://www.lewrockwell.com/orig10/scott-m1.1.1.html
 
Old October 27th, 2009 #96
Alex Linder
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[Good article, explains insurance. The government and its schools and handmaiden media have lied for so long that very few understand what's actually going on with health care and insurance and wages and employers. In a democracy, everything is reduced to the lowest level, that the stupidest among us might misunderstand and grow inflamed, hence clamarous to be led to the land of Free Good Things for Everybody.]

One of the many bad side effects of the current system is that the meaning of the word insurance has become corrupted in public discourse. The way that the word is used in the current debate means, approximately, "a third-party payer who will provide unlimited health care at minimal or no cost to the patient." I frequently hear people ask, "how can someone with an illness obtain insurance?" What the sick person needs is care, not (necessarily) insurance. In any case it would not make sense for an insurer to provide a policy to someone who is already sick.

When I blogged about this recently, I received several emails with questions along the lines of, "I have medical expenses that I cannot afford, therefore I need insurance." But insurance as such can only replace large unpredictable risks with small but known payments by distributing the small risk over a large pool of insured. Insurance cannot solve the problem of funding all routine or regular care because distributing a fixed and even expense does not reduce the cost – it probably increases the cost. A policy that covered predictable and recurring care would have to charge at least as much as the care itself, and then some to account for the overhead of claims processing. The insurance company must prevent fraud and ensure that the care they are paying for is necessary. This imposes additional monitoring costs. For the people who emailed me, a policy would only reduce costs if someone else paid the premium.

It is not necessarily the case that costs of care under a cash payment system would be the same as they are now. Under a cash payment system prices would have to be lower, for several reasons: people would become price-sensitive in their consumption decisions; third party monitoring costs would be eliminated in most cases; and providers would have to compete on the basis of price. See this discussion of health care in India for some insight into how a cash paying system might function.

While the current four-party system is not the only reason that costs are as high as they are, it is one reason. So we are stuck in a loop where costs are high because we have insurance but we must have insurance because costs are high. For more information about the history of the four-party system, I recommend the excellent paper The Modern Health Care Maze: Development and Effects of the Four-Party System by Kroncke and White.

Also, most people do not perceive the costs of the current system accurately. I believe that employer-provided plans are partly at fault for this. Because the plans are nominally paid for by the employer, they create an illusion that care is provided at no cost to the insured. Most employed workers do not understand that they pay for their health plan through reduced wages. The tax system is also partially responsible for this system because the employer's expense is tax deductible, but the employee’s purchase of a similar plan out of their after-tax income is not.

People are for the most part unaware how much lower their wages are due to employer-provided plans. If your employer is providing a family plan that costs several hundred dollars per month, this is costing you thousands of dollars annually in lower wages. Having your employer purchase a policy on your behalf also creates the well-known issue of lack of portability when you change jobs. I wonder how many people do not change to a better-paying or otherwise more attractive job due to the portability issue.

Without benefits, the present employer costs would have to go back into wages. In my experience trying to explain this point, it is an unfamiliar concept and many people are skeptical. The most common response I get is that employers have the ability to simply lower wages by cutting benefits without increasing the cash component of wages, as if the level of wages is totally discretionary on the part of the employer. Economic reasoning is required to understand that the total wage consists of cash payments paid directly to the worker plus expenses incurred on the worker’s behalf by the employer. The opportunity cost of providing employee benefits is less money available for the payment of wages. (If you are not familiar with this idea, see a text on the marginal product theory of wages, for example, Man Economy and State, Chapter 7).

http://www.lewrockwell.com/blumen/blumen18.1.html
 
Old October 27th, 2009 #97
Rick Ronsavelle
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The same is true for Social Security. The boss allegedly pays half. In fact, the worker pays the entire 12.4%. If the health insurance and Social Security were shown accurately on the pay stub, the percent deducted would be much higher, possibly outraging the worker.

When one explains that, in absence of these deductions, the market would kick up wages, most folks deny it. If they make $15/hour now, they think they would still make the same even if insurance were removed. Insurance and half of SS are viewed as gifts from the boss.

The one making $15/hour is already making closer to $18 (?), but doesn't know it due to deductions-in-advance, These deductions are not in any paperwork that the employee sees.
 
Old October 28th, 2009 #98
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Quote:
Originally Posted by Rick Ronsavelle View Post
The same is true for Social Security. The boss allegedly pays half. In fact, the worker pays the entire 12.4%. If the health insurance and Social Security were shown accurately on the pay stub, the percent deducted would be much higher, possibly outraging the worker.

When one explains that, in absence of these deductions, the market would kick up wages, most folks deny it. If they make $15/hour now, they think they would still make the same even if insurance were removed. Insurance and half of SS are viewed as gifts from the boss.

The one making $15/hour is already making closer to $18 (?), but doesn't know it due to deductions-in-advance, These deductions are not in any paperwork that the employee sees.
True. The problem is inherent stupidity. It's like people celebrating their refund check like it wasn't their money in the first place.
 
Old October 28th, 2009 #99
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Like people who say they "owe" money to the IRS rather than use the correct term which is 'theft'.
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Old October 28th, 2009 #100
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We have income tax here, a war measure from WWII. People sometimes ask when we're debating taxes why it hasn't been repealed as the war ended 60 years or so ago - I always tell them it is because the war in reality did not end as there are still white people in the world.
 
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