Saturday, September 29, 2007

ABC's John Stossel Takes Dead Aim At Forcible Health Insurance

While trolling the blogosphere, I discovered the issue of forcible health insurance being discussed on the Copious Dissent blog, which looks like a libertarian-oriented production. The editor was discussing John Stossel's take on the national trend towards forcing everyone to carry health insurance, which imposes yet another unfunded mandate on a tax and expense-weary population.

Although the mad rush of Democratic Presidential candidates to jump aboard this train has been highlighted, with Hillary Clinton's plan evaluated HERE, and John Edwards' plan discussed HERE, the first state to force everyone to buy health insurance was Massachusetts, governed at the time by...Mitt Romney, a Republican. Of course, we're now finding out, bit by bit, that Mitt Romney is to conservatism what Larry Craig is to heterosexuality and Michael Jackson is to child care. This is the same Mitt Romney who allowed Massachusetts to become the first state to legalize gay marriage. If you really believe that Mitt Romney is a "conservative", you might want to visit the website of Massachusetts' leading pro-family organization,, and read their evidence challenging that notion.

John Stossel, who seems like a right-wing version of Jesse Ventura, has a knack for skewering complex issues with logic, wit and common sense. And his take on healthcare is no different. He states that Senator Hillary Clinton wants to require everyone to have it, big companies to pay for it and government to buy it for the poor, which he then proclaims is the wrong direction. Here is more of what he asserts brilliantly, as posted on Copious Dissent:

America's health-care problem is not that some people lack insurance -- it's that 250 million Americans do have it.

You have to understand something right from the start. We Americans got hooked on health insurance because the government did the insurance companies a favor during World War II. Wartime wage controls prohibited cash raises, so employers started giving noncash benefits, like health insurance, to attract workers. The tax code helped this along by treating employer-based health insurance more favorably than coverage you buy yourself. And state governments have made things worse by mandating coverage many people would never buy for themselves.

Competition also pushed companies to offer ever-more attractive policies, such as first-dollar coverage for routine ailments, like ear infections and colds, and coverage for things that are not even illnesses, like pregnancy. We came to expect insurance to cover everything.

That's the root of our problem. No one wants to pay for his own medical care. "Let the insurance company pay for it." But if companies pay, they will demand a say in what treatment is -- and is not -- permitted. Who can blame them?

And who can blame people for feeling frustrated that they aren't in control of their medical care? Maybe we need to rethink how we pay for less-than-catastrophic illnesses so people can regain control. The system creates perverse incentives for everyone. Government mandates are good at doing things like that.

Steering people to buy lots of health insurance is bad policy. Insurance is a necessary evil. We need it to protect us from the big risks -- things most of us can't afford to pay for, like a serious illness, a major car accident or a house fire.

But insurance is a lousy way to pay for things. Your premiums go not just to pay for medical care but also for fraud, paperwork and insurance-company employee salaries. This is bad for you and bad for doctors.

The average American doctor now spends 14 percent of his income on insurance paperwork. A North Carolina doctor we interviewed had to hire four people just to fill out forms. He wishes he could spend that money on caring for patients.

The paperwork is part of insurance companies' attempt to protect themselves against fraud. That's understandable. Many people do cheat. They lie about their history or demand money for unnecessary care or care that never even happened.

So there is a lot of waste in insurance -- lost money and time.

Imagine if your car insurance covered oil changes and gasoline. You wouldn't care how much gas you used, and you wouldn't care what it cost. Mechanics would sell you $100 oil changes. Prices would skyrocket.

That's how it works in health care. Patients don't ask how much a test or treatment will cost. They ask if their insurance covers it. They don't compare prices from different doctors and hospitals. (Prices do vary.) Why should they? They're not paying. (Although they do in hidden, indirect ways.)

In the end, we all pay more because no one seems to pay anything. It's why health insurance is not a good idea for anything but serious illnesses and accidents that could bankrupt you. For the rest, we should pay out of our savings.

All it takes is a little common sense.

Exactly. If health insurance was limited to protect against big-ticket costs, such as catastrophic accidents and illnesses, costs would drop sharply because the client-to-claim ratio would be favorable to the insurer. Greater competition would encourage insurers to charge lower prices.

But even if Hillary Clinton or John Edwards were not to become President, we Alaskans are not out of the woods, because we have our own Hillary in sheep's clothing. His name is Hollis French, and, as an Alaska State Senator, has decided that we should be forced to buy health insurance for our own good. His detailed proposal, which is well-written and meticulously organized, forms the foundation for SB160. He even thoughtfully includes an on-line worksheet so you can calculate how much you'd have to pay under his system. Click HERE to enter his Health Care website.

French's premise is that if you force more people into the system, prices will automatically go down. Unfortunately, there's one flaw in that rationale - if the insurers have a guaranteed endless supply of captive customers, where's the incentive for them to reduce costs? They know you will have to come to them anyway.

But sadly, even the influential Anchorage Daily News has jumped on Senator French's bandwagon. In a recent editorial column, they started gushing over the plan just like a starstruck pre-pubescent teenage girl at a Backstreet Boys concert. The fact that it would impose another unfunded mandate on people did not register with them. Over and over we hear the mantra - 40 million uninsured Americans. No explanation is provided as to why those 40 million are uninsured. It is rarely revealed that many of them remain voluntarily uninsured and are healthy. But, according to the Hillary Clintons and Hollis Frenchs of the world, they might get sick and cost us money at some distant, indeterminate time in the future, so we got to force them to pony up now.

There are many variables that MIGHT become reality in the future, but we can't possibly insure against all of them. Introducing more genuine competition into the system would reduce costs. Oh, and here's another measure we could take - cut off illegal aliens from accessing our health care system.

And finally, we need to change our inflated sense of entitlement. Health insurance should protect against catastrophic occurrences and be used solely for therapeutic procedures - NOT for elective procedures. Lately, a gaggle of local UAA college girls have been bitching because they'll have to pay much more for contraceptives. Too bad. Contraceptives are, for the most part, elective drugs. These self-absorbed chicks do have alternatives - get a diaphragm, make the guy wear a condom, or else consider actually closing their legs once in a while. Those are still valid options. Public money is to be used only to finance necessity or the public interest - it is not to be used to finance luxury or personal convenience. We have become a country of spoiled brats.

But forcing yet another unfunded mandate on a tax and expense-weary population will only increase distrust and outright hatred for government.

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