Michael Eiffert, M.D.
Published: September 20, 2009
Senator Max Baucus has produced a healthcare reform bill apparently only he could love. Opponents from both sides of the aisle are expressing their disappointment, stranding Baucus’ plan in a political no-man’s-land. The Baucus plan and the bill in the House both have huge price tags – it seems “a trillion” is the going price for legislation in Washington these days. Despite some glimmers of renewed economic activity, there has yet to be signs of significant job creation. In fact, the economy is still shedding jobs. Companies are rebuilding depleted inventories or meeting new demand with leaner work forces. Common sense would seem to suggest that adding a new entitlement program is fiscally impossible and irresponsible. Why not try some easy fixes to truly free up the “free market” before we embark on a path of increased government bureaucracy and deficit spending?
Currently, individuals cannot purchase health insurance from out-of-state vendors due to arcane state laws prohibiting this. This artificial barrier limits competition and drives up costs and it is a violation of the Interstate Commerce Clause. One should be able to shop for health insurance the same way one shops for flights, comparing all programs from numerous vendors (regardless of state of origin) and selecting one that meets your needs. Some states have enacted coverage mandates that require services, such as fertility treatments, that drive up costs for all participants. Relaxing these mandates would likely decrease healthcare insurance costs significantly.
Simple changes in accounting laws could allow physicians to write off the value of care provided to uninsured individuals. This would encourage more gratis service by physicians for economically disadvantaged people. Lastly, although states that have enacted tort reform for medical malpractice cases have seen healthcare costs decrease, Obama has ruled out the inclusion of tort reform in legislation he will sign. Tort reform has worked to reduce costs in every state in which it has been enacted.
These simple maneuvers coupled with a modest expansion of Medicaid would likely resolve the entire healthcare crisis. But, politicians would then be robbed of the opportunity to claim responsibility for saving us from another crisis.
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Hi Mike,
As always, great article.
Removing state laws preventing out-of-state competition is certainly one way of reducing costs. This is about the only thing government can do itself, other than dismantle itself.
Tort reform is a must! Interesting idea about write-offs the value of care; in my utopian world, one would not need to write off anything since income taxes would be abolished. If that's too ambitious, we should -tax benefits as income-, restructure the income tax to be revenue neutral (so people aren't taxed as much when adding the taxed benefits) and allow the people to have a choice for benefits vs pay. We need insurance that pays for 50, 100,000 USD medical bills, not for that $30 medical visit. This is a major contributing factor.
The rest of it needs to come from the market. We need to shrink government, get rid of (gasp!) medicare, medical, social security to reduce government involvement and cost.
Next, we need to completely and utterly DEregulate the markets. Yes, you heard right! -DE-regulate. Regulations only serve to the benefit of large insurance companies (since corporations always sleep with big government) and prevent competition.
Lastly, we need free market forces to reduce prices. Look at the only place government is not directly involved in (elective plastic surgeries, botox, eye-lasik). The prices have come DOWN.
What people don't realize is that just like this jujube in my hand that I'm munching away at, health care is a product of the market. The problem with it is that it's too expensive, and the reasons stated above are most of the major reasons why.
Ignore them at your own peril. ;)