Kick the liberal/socialist block out of Congress and things will work themselves out. There are good ideas in these two articles but one of them is NOT MORE GOVERNMENT REGULATION. More regulation = more taxes = more pain in the rear end for all of us.
Morning Bell: Government Is Cause Of, Not Solution To, High Health Care Costs
The Foundry
Morning Bell: Government Is Cause Of, Not Solution To, High Health Care Costs
Federal Reserve Chairman Ben Bernanke told Congress Monday that health care spending
will “rise relentlessly” unless lawmakers overhaul the health care system. As if trying to prove his point, PriceWaterhouseCoopers released a study yesterday showing employer health care costs will increase 9.9% in 2008, more than double the annual rate of inflation.
Liberals will tell you that health care costs can be controlled through more government regulation of the health care industry. For example, Sen. Barack Obama (D-Ill.) says he can save $200 billion in health care spending every year through investing in electronic medical records, more centralized coordination of individual care, and government mandated reduction of unnecessary medical procedures. Problem is, no one with any training in the economics of health care believes that savings will materialize. John Sheils, vice president of the health care consulting firm the Lewin Group, says the savings “are just dramatically overstated .” And MIT health economist Jonathan Gruber calls the numbers “nonsense,” noting that there is “zero credible evidence to support that conclusion.”
Obama is right about one thing, though. In February of this year, he said: “The reason people don’t have health insurance isn’t because they don’t want it, it’s because they can’t afford it.” That is true. But the solution to expensive health insurance is not more government mandates and regulations; it’s less. A major why reason health insurance premiums keep rising is because special interests keep successfully lobbying state legislatures to mandate more and more procedures into all insurance plans. So even though a 25-year-old male has no need for in vitro fertilization and no interest in acupuncture, a state like New Jersey forces him to buy a plan that covers those procedures. The result? That 25-year-old could buy a basic health plan in Kentucky for $960 a year, but the cheapest plan in New Jersey (full of mandates he doesn’t want or need) costs him $5,880. A study for the Health Insurance Association of America found that 20% to 25% of uninsured Americans lack insurance due to benefits mandates.
Another major factor driving up American health care costs is our antiquated tax code. Thanks to advantages slanted toward employers, the current tax code imposes a tax penalty of up to 50% on the cost of an individually owned policy, effectively pricing millions of working families out of coverage. Americans are not forced to all buy the same type of cell phones, and they are not forced to buy their cell phones through their employers. But thanks to oppressive state mandates and World War II era wage controls, that’s how Americans are forced to buy health insurance. Moving to a consumer-centered health care market , where individuals could purchase health insurance on a level playing field with corporations is a much better way to both reduce health care costs and get more Americans the health care they need.
Published: June 17, 2008
WASHINGTON — Ben S. Bernanke, chairman of the Federal Reserve, told Congress on Monday that health spending would “rise relentlessly” unless lawmakers overhauled the health care system, and he recommended an eclectic approach.
His remarks opened a daylong bipartisan symposium convened by the Senate Finance Committee to lay the groundwork for what leaders of both parties predict will be a major push for health care legislation next year.
“We will move quickly in 2009,” said Senator Max Baucus, the Montana Democrat who is chairman of the committee.
Mr. Baucus suggested that “some kind of federal health board” could help Congress make technical policy decisions. “How in the world am I supposed to know what the proper reimbursement rate should be for a certain procedure?” he asked.
Mr. Bernanke said Congress could establish an independent health care panel like the one used to recommend the closing of military bases. Congress, he said, could approve or reject the panel’s recommendations, but not amend them.
Alternatively, Mr. Bernanke said, Congress could establish a commission like the Federal Reserve Board to set health policy. But, he said, such a panel would need “very clear guidance from Congress,” because health care accounts for “an enormous part of our economy.”
“At some point,” Mr. Bernanke said, “health care spending as a share of gross domestic product will stop rising, but it is difficult to guess when that will be, and there is little sign of it yet.”
At the end of the day, Democrats and Republicans appeared to agree on this much: All Americans should be insured, but they should have a choice of private health plans competing in the market alongside government programs.
“Democrats are right in saying that if you are going to fix the system, you have to cover everybody,” said Senator Ron Wyden, Democrat of Oregon. “Republicans are right in saying that you have to have markets, choices and private alternatives.”
The impatience of some Republicans was expressed by Senator Charles E. Grassley of Iowa, the senior Republican on the Finance Committee.
Health care is “the No. 1 economic issue in our country,” Mr. Grassley said, but “Congress does not seem to have the political guts to do anything about it.”
Craig R. Barrett, the chairman of Intel, expressed immense frustration at the inefficiency of the health care system, and he said employers were determined to do something about it.
Almost every other industry “has automated itself and now pays less for better quality,” Mr. Barrett said. Employers will demand similar changes in health care, he added.
Mr. Barrett said large employers were “an agent of change” in the health care system, and he warned Congress not to do anything that would undermine employer-sponsored health insurance.
President Bush and members of both parties have proposed giving new tax breaks to individuals, including employees, so they can shop for health insurance on their own.
Senator John Kerry, Democrat of Massachusetts, described that idea as “a political nonstarter.” It would, he said, threaten coverage for many of the 160 million people with employer-sponsored health insurance.
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