Health Care Woes: Reagan is Still Right!

As I’ve said numerous times, we need LESS government intervention in health care, not more. A great deal of our current health care woes stem from too much government involvement in health care.

A new article from Investors Business Daily zeroes in on the problem:

Public health programs account for almost half of the $2 trillion spent on U.S. health care, a Hoover Institution report says. An astonishing 80% or more of all medical-care pricing is based on government reimbursement rates set by Medicare.

As for private costs, they would be lower if government didn’t interfere in the market. Regulations imposed on the industry cost more than $330 billion a year, Hoover says.

Perverse tax policies have created a third-party payer system. Patients no longer have first-dollar responsibility for medical bills thanks to employer insurance.

Someone else is paying, so inflation goes unchecked and unabated.

“Patients have no idea what their doctor visits, surgeries, diagnostic studies or other medical services — whether urgent or elective — will cost until the bill comes weeks later,” said Dr. Scott W. Atlas, a senior Hoover fellow and chief of neuroradiology at Stanford University Medical School.

Even then, they seldom flyspeck the bill. Why bother, when they’re responsible for just 10% to 20% of it?

Between insurance and government involvement, there is little incentive among the consumers of health care to put a check on rising health care costs.

The law of the market is that providers of goods and services can only charge what the market will bear. If they charge more than consumers can pay, they will lose business–and perhaps go out of business, especially if there is competition which will under-bid them.

The deep pockets of insurance companies and the government, coupled with their inability to adequately monitor the validity of expenditures (they aren’t on-scene as the consumer, so they cannot fully know what should and shouldn’t be spent), has led to out-of-control prices and spending.

We need to move back toward a more consumer-involved model for the health care industry, one where the consumer has more responsibility–and motive–for keeping health care costs and expenditures down.

Calls for more government intervention to fix the health care problems in America are akin to throwing a bucket of gasoline on a fire in order to put out the fire.

As the great Ronald Reagan once said, “Government is not the solution to our problem; government is the problem.”

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