At the outset, let me make myself clear on a couple of points that I believe are vitally important to the healthcare issue. First, I do not support nationalized or government run healthcare in any form or fashion. Second, I do not support any increase in taxes to fund or subsidize any healthcare program whether it is privately run or administered by the government. I believe it is impossible to have an honest discussion about this issue without stating one’s positions on these two points and it is no surprise that Mr. Taylor failed to do so in his letter responding to an inquiry about healthcare reform. It is not politically expedient for a career politician to openly profess their stands or beliefs on an issue if their stand may conflict with their constituents or with their party affiliation.
Fundamentally, I believe the government is incapable of effectively administering or operating a healthcare plan as evidenced by the failing entitlement programs it is already responsible for. I also disagree with President Obama’s assertion that the government can increase competition, thereby lowering costs, by implementing a government run health plan or insurance option. It defies basic economics to make such a claim. For example, how can a business compete if it is forced to fund a competitor’s operations and must also follow rules set up by its competitor? This is not competition; it is control and is unsustainable.
Particularly misleading is the purported notion that creation of a “government healthcare option” would not affect the choices of those already insured. Proponents of the Obama administration’s plan continue to claim that if you like the health coverage you currently have, you can keep it. What they fail to recognize (or, perhaps, admit) is the effect a tax-payer subsidized government healthcare option would have on private health insurance. The creation of a tax-payer subsidized, and therefore ostensibly cheap, government option would give employers strong incentive to drop their employer-sponsored health care coverage for their employees. Many astute employers would understand they could save substantial amounts of money simply by eliminating the large expenses they pay on behalf of employees to provide healthcare coverage for them and, instead, merely directing their employees to the government option. It is not easy to envision a world where employer-sponsored programs (the ones Americans say they like) become extinct as a result of the government “option.” Stated simply, a tax-payer subsidized government option is the first step towards complete nationalization of our healthcare system.
Listed below are six areas I believe we need to focus on to reform healthcare. It will allow my supporters to see how I will approach this issue in Congress and what I will expect from the committees that are specifically assigned to oversee healthcare legislation. Regardless of where I am assigned, I will aggressively push issues that are important to my constituents.
1. Reform Medicare and Medicaid. There is consensus among experts in both parties that Medicare and Medicaid are on the path to insolvency within the next three decades. It’s easy to see why. According to the Congressional Budget Office, in 2008 we spent over $657 billion on Medicare and Medicaid, which represented 22% of the total federal budget. In 2007, the cost of Medicare Part A began to exceed the program’s incoming tax revenue. This means that the government must use income taxes from the general fund to supplement this program. By 2017 we will be in the same situation with Social Security and this may occur sooner due to the current economic recession. These government run programs are one of the main factors that are driving up healthcare costs and must be reformed.
2. Focus reform at the state level. Allow states to implement healthcare policy based on their citizens’ needs instead of forcing them to adopt a massive federal program. Each state has varying needs and should not have to adopt federal policy that may or may not serve the best interests of its citizens.
3. Adopt market-driven policy based on fundamental economic principles.
A. Regulation should stimulate competition, not deter it. Insurance providers should not be required or mandated to provide coverage for various procedures that may or may not be needed by different policy holders. People should be able to choose which plan they want based on the coverage it provides and not have to choose from blanket policies where they will have to subsidize procedures they will not use. Companies need to compete on cost and service and not be required to offer generic, one-size fits all plans that may or may not fit the needs of the market.
B. Increase supply. Basic supply and demand economics tells us that we must have more healthcare professionals to serve the demands of the market. We must incentivize universities to accept more students into their medical programs and we must make it easier for foreign students to stay in the U.S. to practice when they complete their studies. There is a huge investment made to support international students and we should keep them here to make a return on that investment.
C. Cost awareness. Healthcare costs should be more transparent so that consumers can make informed cost decisions. They should be able to compare what doctor’s charge, the quality of service they provide, and different types of procedures and alternative treatments so they can make informed decisions. We must be able to shop and compare to force healthcare professionals to offer competitive prices. Related to this, we should welcome increased patient responsibility in shouldering procedure specific costs. Co-pays, coinsurance, flexible spending accounts, and other means of placing at least some of the cost burden back on patients forces them to have financial skin in the game and incentivizes patients to engage in quality and price research. As patients engage in such active quality and price research, costs will be controlled and even decline. We are already starting to see this happen amongst the legions of uninsured in America who are paying for and, therefore, intensely researching their healthcare options. Do you think a medicaid recipient would be so quick to call an ambulance for a regularly scheduled visit if they knew they were required to pay some of the cost?
4. Insurance reform. Insurance companies must play by the same rules as other companies and should not be exempt from anti-trust laws. They should have to compete on cost just like any other company in other industries. Insurance providers should also be required to eliminate the administrative inefficiency that is also impacting cost. People should be able to negotiate and handle cost directly with their doctors and not have to go through the administrative labyrinth of the current system.
5. Tort reform. The cost of litigation and liability insurance are so high that it is putting many healthcare professionals out of business. It is also impacting a doctor’s better judgment about the treatments that should be offered and the extent to what tests and analysis should be done on each patient. Doctors have to be vigilant against lawsuits, so in many cases they do unnecessary tests and procedures to protect themselves against any possible claims of malpractice.
6. Everyone should pay for their insurance. There is a misconception that the government should be responsible for making sure every citizen has health insurance. There are many people who cannot afford to buy insurance, but there are also those that can afford to, but do not. It is a basic economic decision that weighs the potential risks and benefits of having or not having insurance. What’s next? Are we going to provide every citizen with life insurance? Although the number is misleading, there is an estimated 46 million people without insurance in the U.S. This is less than 15% of the population of the United States, yet our government is considering a massive over-haul of a system that will cost the vast majority of us even more to buy adequate insurance. If each of these people were required to pay for their insurance, even if it was a nominal amount, then the over-all cost burden would be diminished greatly. For example, if each of these individuals were required to pay a nominal $10 dollars a month for their coverage, it would raise $470 million dollars per month for coverage. This could be managed by private insurance companies and would generate enough revenue so that those paying full premiums would only be subsidizing this cost once, not twice. In other words, we would not be taxed to support a government program and also pay higher healthcare costs to subsidize those who do not pay. It is also important to point out that many insurers provide an option that only covers “catastrophic” injuries or illnesses. These policies generally only cover procedures or illnesses that require admission to a hospital. They cover the medical expenses that would otherwise drive a person to bankruptcy, and these policies are VERY affordable.
After reading Mr. Taylor’s lengthy response regarding healthcare, I am still unsure as to where he really stands on the issue and what he believes will lead to successful reform. This is a summary of what I know from reading his letter:
1. Healthcare is too expensive and will be even more expensive in the future
2. The main issues considered by various proposals are quality, accessibility, and cost of care
3. He is skeptical of Obama’s plan because it focuses on accessibility without addressing cost and quality
4. The Congressional budget requires Obama’s plan to be paid for by raising revenue (new taxes) or cutting spending
5. He does not support increasing the budget deficit and does not think adding hundreds of billions in new spending is the answer to the problem
6. He will closely examine the proposals and alternatives being drafted
7. He supports legislation that would allow medicare to negotiate prices with drug companies and believes this is one part of lowering cost (points out shady dealings of a Republican Congressman and the former Bush administrations’ opposition to this bill)
8. He supports HR1583, legislation that would repeal the insurance industry’s antitrust exemption (stop insurance companies from pushing responsibility off on government programs)
These are the questions Mr. Taylor did not answer and what I believe is most important to the people of South Mississippi:
1. Does Mr. Taylor support a nationalized or government run Healthcare program or insurance?
2. Does Mr. Taylor support raising taxes to cover any of the potential proposals?
3. Does Mr. Taylor have any other solutions to the problem besides allowing the government to negotiate prescription drug costs and removing the anti-trust exemption for insurance companies?
4. Because this issue is of monumental importance to most Americans, what is Mr. Taylor going to do to make sure his constituents have a voice in the process?