The Campaign Spot

A Long, But Interesting, Discussion of Health Care Policy With Readers

Wow. Here I was, thinking health-care policy was this dry, wonky topic about premiums, and I’m greeted with an avalanche of e-mail. (And very few of it was people complaining and looking for health advice.) A great deal of reader response has been eye-opening personal experience with our Byzantine system from the supplier side, and the various ways that government attempts to “fix” the problem have made it worse.


John points out that the current system is light-years away from anything resembling the free market: 

I had to quickly scan your Hillaryspot column on Health care, and you seem to be suffering under a delusion that American physicians are free to set their fees, and will be paid accordingly.  I can assure you that we physicians are not free to do anything of the sort.  We can not pass on costs, we can not compete by lowering prices, we can not even charge what supplies may cost us, if they happen to be over the set fees.  Medicare has set the fees, and just about every insurance company and managed care contract has keyed off of Medicare.  Feel sorry for that poor old person, so decide to see him for half price?  Congratulations, you are guilty of Medicare fraud.


Physicians may not give the same service for less than the Medicare mandated fee if those physicians have agreed to be a Medicare provider. It is even illegal to waive a copay.  As for trying to charge higher fees for costs, just because your malpractice went up 100% last year?  You may try to increase your fee schedule, but it will just be written off by the payors, and it is, of course, illegal to attempt to recover anything over the schedule.


We have had this degree of socialization for years.  I am disappointed that even on NRO that this is not better known.  There is no free market, nor will there be, for physician services.


In PA, where I practice, malpractice has driven many physicians away from the state, and will likely continue to do so.  When I began practice in 1983, I paid about $3500  for my premium.  This year it is north of $20,000, even with the state helping out to some degree.  In the 1980’s, about 50% of physicians who went to medical school in PA stayed here to practice.  This past year, retention is at 4%.  In addition to malpractice premiums skyrocketing, reimbursements are regional.  If you set up practice 30 miles from where I am, and get into Ohio or NY, your fee base could be 30-40% better than it would be in PA, for exactly the same service. 

Just a foretaste of central planning run amok.  I liken it to having congress decide that NOAA had become so good at forecasting weather, that they could save heating and A/C costs by running every thermostat in the country from Washington according to their long-range forecasts.  In order to make sure that they had good control, laws would be passed making it mandatory to nail shut your windows and outlawing fans.  Such is the state of health care in this country, and it doesn’t look much better in the future unless we can somehow wrest back the thermostats.

Michael offers his firsthand experiences:

I am an Emergency Room Physician and hence am qualified to make a few observations.  The first point is in regards to financing so-called universal health care.  It is plainly immoral to force one individual to pay for another’s health care.  That is however, the basis for all universal health care schemes.  As soon as 51% of the populace figures out how to force the other 49% to pay for their health care “universal health care” suddenly becomes politically viable.  And you will note that progressive taxation schemes are invariably used to pay for it.


Next, it should be noted that “preventive” health care is practically a joke.  There are very few diseases that can actually be prevented.  Most that can be are already covered by free or nearly free programs such as immunization, most of the rest are lifestyle related.  It is entirely a myth that preventive measures would, for example, help avoid ER visits, the top eleven reasons for going to the ER have no relation to any sort of preventive measures whatsoever.


Lastly, the idea that providing people with free care through the government or a national health insurance program would help control costs is ridiculous.  The people who get the free care now are the ones who constantly abuse the system.  In the course of my day my patient population consists of about 70% Medicaid “beneficiaries” and illegal immigrants.  These patients pay nothing to access the health care system, yet approximately 90% of them are in the ER with a trivial or non emergent complaint.  But Hey! It’s free! 


Giving another 46 million people, only 55% of whom are U.S. citizens, free health care is a just a great idea all right.Move health care financing to a free market basis, do something about malpractice, reward charity care and make people responsible for their own health care decisions, only then will you solve the “health care crisis” in a moral fashion.

(When a member of the military writes in, I usually make a note to say, ‘thank you for your service. Maybe I ought to do so for the medical personnel write in. Then again, I’ll have to thank everybody who writes in – cops, firemen, accountants…) 

Warren, who also has a medical background, thinks Bush’s latest proposal may be a key step:

The cure is gradually falling into place now; over time employees are having their Cadillac style medical policies replaced by an affordable Ford version.

In the State of the Union speech GWB actually provided the solution that will be phased in.

Health insurance under some dollar amount will be exempt from income tax to everyone. Anything more provided by an employer will be taxed as income. In addition, there must be a Federal mandate that stripped down basic health insurance policies with the exact same policy wording can be offered across state lines.


That is today’s problem. Insurance companies have arranged for every state to have different health insurance mandates. Once there is a Federal requirement that the same basic stripped down health insurance policy must be available everywhere, Insurance companies can quantify their costs and will make them available on a nationwide basis at an affordable cost.

Richard has some optimism:

As I understand it, new drug pipelines are slowing down.  That being the case, might it be that within the next few years the vast majority of drugs that Americans take regularly are, or can be generic. (If not the exact drug, then one that is close enough)   If that is the case, is prescription drug coverage only necessary for catastrophic cases.  If we can get 90% of the drugs we need inexpensively, there is no need for insurance to cover them.  It is only necessary for rare cases that demand new or rarely used (and hence expensive) drugs.  If we can we get good enough drugs for blood pressure, cholesterol, birth control, stomach acid and a few others in generic form nowadays, and if they can be made for for a few cents a pill it’s worth asking if we need insurance for anything other than rare diseases or diseases for which good medicines have yet to be found.  Perhaps antibiotics are the joker here.  As drug resistant strains of germs and disease rise, the new antibiotics we are forced to use become expensive.

At the moment, we all want the newest drug, even if it’s only marginally better (and possibly not that).  System-wide, that’s not reasonable.

I loved the parallel that inspired this idea from Drennan:

How about this: A National Health Care Plan that simply says that insurance companies may offer policies across state lines, that they must offer a choice among 1) catastrophic care 2) basic care 3) enhanced basic 4) super-enhanced basic and 5) pay per view.  If this sounds familiar, it should,  It is based on the offerings from Comcast and my telephone company.  The government will stay out of what these categories consist of–it’s up to the Insurance companies and the market.  If they want to offer special pricing for bundling these categories, fine.  Competition should do wonders for the market.  People need only 1) and 2).  If they want to go to Chiropractors, Massage Therapists and Naturopaths and have their birth control pills paid for, they’ll have to go for one of the enhanced plans. 

I suppose, however, that getting government to stay out of it is beyond the ability of our political system.

Or combine them. “I’ll take HBO, muscle relaxants, recreational Cipro, the NFL Dish package, and emergency care.”


Jim points out “another costly result of the explosion of malpractice suits that you mentioned: Out of fear of being sued for malpractice for overlooking (1) an alternate (albeit unlikely) diagnosis and/or (2) a test that might reveal another (previously undiscovered but unlikely) condition, doctors now feel constrained to order up pretty much any and every test in the book that might be tangentially related to the problem at hand. In other words, CYA. Ka-ching, ka-ching.” 

Jill points out how some states’ regulations – particularly, the Certificate of Need – can really gum up the works:

Certificate of Need (CON) has had a broad impact on health care providers and markets for over three decades.  CON is based on the premise that governments can do a better job of matching supply and demand than the health care marketplace.   

In a CON state, with few exceptions, you can’t acquire or replace any facility or equipment, and offer new or add to existing health service with CON approval.  If the need for a service, facility, piece of equipment is not in the annual state plan, you can’t apply for it until there is a need found according to the state’s need methodology.  Hospitals, EDs, beds, ORs, CTs, linear accelerators, MRI, cardiac cath, hospice, Medicare certified home health agency, nursing home, you name it are regulated by CON.  CONs work by county – if you want to move CON asset within county, CON application.  If you want to move a CON asset from one county to another, no can do.  If you have a chronically underperforming CON asset, your underperformance will be included in the mathematical need methodology, and could be outcome determinative – no new need in the annual plan.  The market – what’s that?

Phillip notes something that’s been nagging at me – more and more Americans’ views on health care is “give me the very best care available, and give it to me for free,” at the exact moment when so many of us are… well, carrying around a spare tire. And/or a minivan.

In answer to the above question:  EAT RIGHT AND GET ENOUGH EXERCISE.  Also get married before you get pregnant.  Finish high school.  Get a job.

 Sounds rather simple.  But I wonder how much of our health care costs are related to “life-style” choices which bring about ill health rather than the “accidental” illness, either through true accident, accident of genetics (ALL the males in my family had some sort of heart disease before they turned 50.  I got the message through some measure of careful diet, exercise, and luck, and managed to make past that milestone without incident), or accident of age (average life expectancy is increasing and our bodies just fall apart at some time).  Car insurance is based on your history – the more accidents you have, the more you pay.  Life insurance is likewise – the older you get the more you pay.  Unfortunately, health insurance typically isn’t.  Yes, it may be on the individual level.  But at group levels, it’s averaged out over the history of the group.  And if it goes universal, it will be truly averaged out.  Somehow, I don’t want to waste my tax dollars of subsidizing someone else’s bad habits.  The thought of paying for quadruple bypass surgery on a 40 year old 50 lbs overweight smoker makes me sick.  Think I’ll go to the doctor.

Chris reveals another complication of having somebody else – i.e., the government – pay for checkups.

The concept that if you pay for people to get their teeth cleaned now so they don’t have to get a root canal later really doesn’t work.  I had an Uncle who was a Dentist in East St Louis, most of his work was welfare (Medicare/Medicaid) and he had about a 60-70% no show rate on appointments.  It turned out to be a vicious cycle; to cover costs he would have to triple book every appointment and at some point during the day all three people would show up, thus long waiting times, etc.   

If you pay for it yourself you know you will get billed if you don’t show, so those little conflicts (like the cat being sick) have a lower priority than if you aren’t paying yourself and there is no consequence of not showing.

Finally, many readers note that my reader’s comment about Cuba having a lower infant mortality rate is dodgy at best and a lie at worst. 


Cuba has lower infant mortality because pre-term babies are considered “stillborn” and not infants. Also Castro gets to edit the numbers. (I mean seriously, Cuba?) See here.


Vaccination is low because people chose not to have their kids vaccinated. This is not an cost issue, its way more complicated and the cost doesn’t go down if we share the bill. I live in Japan. Semi-socialized vaccines. Except mumps, for that they hang a sign on your door. Better?

(Yeah, but then the government will start regulating the mumps-door-sign market, and a single sign will cost $800 and there will be a three-week waiting list…)



Since when do we take self-reported numbers from totalitarian societies seriously?  If Cuba truly had a better health care system, you would think we would have Americans flocking to the sunny Cuban shores for their healthcare instead of Cubans trying to get here. 

Fascinating stuff, and I thank my well-informed readers. At this point, I’m going to put the topic aside for a bit – this is the Hillary Spot, not just the Health Care Policy Spot – but I’m sure we’ll be coming back to this, when some other candidate unveils their health care proposals.


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