Archive for July, 2009

Are you sick of hearing about the Healthcare reform bill?  I am.  Unfortunately, endurance is called for as this is a very important topic for all of us.  Since we have heard so much from all the politicians in DC, it might be time to hear from someone that will be impacted (severely) by their actions.  A few great quotes are:

I took a different path, seeking a cancer vaccine. One had been developed at Stanford University 12 years earlier that had given 90% of patients very long remissions and cured some entirely. Unlike chemotherapy, there were no severe side effects.

But I couldn’t get the vaccine because the Food and Drug Administration required another trial that would take nine more years. Over-regulation has kept this treatment from patients for 21 years, as some 24,000 lymphoma patients died each year.

and,

I am still here because my care was managed by doctors—not a government agency. My doctors do what the bureaucracy can’t: They see me as a human being.

and,

Patient-as-person will be a lost concept under the new health-care plan, where treatments will be based not upon individual patient needs, but upon what’s best for everyone. So cancer drugs for seniors might take second place to jungle gyms and farmers’ markets—so-called preventive care—which are covered under both the House and Senate versions of the health bill.

A British physician’s take on our government’s move to socialized medicine.  Here are a few of my more favorite quotes.

Where does the right to health care come from? Did it exist in, say, 250 B.C., or in A.D. 1750? If it did, how was it that our ancestors, who were no less intelligent than we, failed completely to notice it?

and,

Moreover, the right to grant is also the right to deny. And in times of economic stringency, when the first call on public expenditure is the payment of the salaries and pensions of health-care staff, we can rely with absolute confidence on the capacity of government sophists to find good reasons for doing bad things.

and,

Universality is closely allied as an ideal, ideologically, to that of equality. But equality is not desirable in itself. To provide everyone with the same bad quality of care would satisfy the demand for equality. (Not coincidentally, British survival rates for cancer and heart disease are much below those of other European countries, where patients need to make at least some payment for their care.)

The graph to the right was presented in the Wall Street Journal this morning and is based on government data for healthcare cost inflation.  Does anyone else find this a little disturbing?

It shows that the government agency that our leaders want to depend more on for managing the healthcare of millions and millions more individuals is actually estimating that they will experience a higher inflation rate than the private sector over the next 9-10 years.  It also shows that the government system has experienced a faster growth in costs than out-of-pocket or private insurance since 1990 (every year).

And our wise leaders think it makes sense to use them to increase coverage and lower healthcare costs?  I don’t get it.

Our government leadership appears to lack a basic understanding of economics.  I think it is fair to say that the root of economics is based on the understanding that prices of goods are driven by the demand for those goods and the amount of supply of those goods.  When do you get that house you’ve always wanted cheap?  When everyone wants to sell their house (big supply) and no one is in the market to buy one (low demand).  That’s obvious, right?

Well, not to our authoritative leadership.  From a very limited understanding of the current Healthcare Bill being pushed by Mr. Obama and Ms. Pelosi, it’s desire is to forcefully increase the number of participants (universal coverage) and dramatically reduce the profit potential of those that provide the services (which actually reduces the number of participants).  The net effect is an increase in demand for healthcare and, at the same time, a reduction in the supply of it.  Under every scenario, this will increase the cost of healthcare.  And if we have less money to spend (because we need to collectively divert more of our money to satisfy whimsical regulation), we will end up with less healthcare, not more.

If the end point they desire is more healthcare (i.e. universal coverage), you need to make it cheaper, not more expensive.  What does economics teach us about lowering the price of a product?  Have more of it.  And how do you do that?  Make it cheaper to produce by lessening the cost for someone to practice medicine through lower malpractice insurance (i.e. stop John Edwards from chasing ambulances), lower the complexity of getting paid (talk to a hospital administrator and ask how many people it takes to get paid by Medicare and Medicaid.  It is a joke, just not funny), make it easier to have competing hospitals, lower the costs of gaining approval for drugs…  The list is there.  Lawmakers just need to accept the fact that their past actions caused the problems, not solved them.  As well intentioned as they were, our government is the biggest reason for any healthcare inflation we may have faced.

A common thread within our government is the belief that the ends justify the means.  This is never true.  Never.  You can not achieve a stable and self-sufficient end if the means are diametrically opposed to it.

Call your representative and ask them if they understand basic economics.  And then ask them how the proposed healthcare bill fits with the basic laws of supply and demand.

Read this article…  And then read it again…  And then write the main points on your palm or arm so that when someone tries to convince you that we “need” healthcare reform as presented by our federal government, you have the talking points right in front of you.   Please, please, please read this article.  I have not read anything else that so clearly and logically refutes the arguments being made by our authoritarian leaders.

Two excerpts worth highlighting:

- “A universal plan will reduce the cost of health care.”

Think a moment. Suppose you are in an apple market with 100 buyers and 100 sellers every day and apples sell for $1 a pound. Suddenly one day 120 buyers show up. Will the price of the apples go up or down?

and:

- “We need a public plan to keep the private plans honest.”

The 1,500 or so private plans don’t produce enough competition? Making it 1,501 will do the trick? But then why stop there? Eating is even more important than health care, so shouldn’t we have government-run supermarkets “to keep the private ones honest”? After all, supermarkets clearly put profits ahead of feeding people. And we can’t run around naked, so we should have government-run clothing stores to keep the private ones honest. And shelter is just as important, so we should start public housing to keep private builders honest. Oops, we already have that. And that is exactly the point. Think of everything you know about public housing, the image the term conjures up in your mind. If you like public housing you will love public health care.