Americanly Yours

For a long time I did not have health care.  I was fresh out of college and was relatively healthy.  For me, there was no real need for health insurance.  But, a year and a half or so ago I decided that it was in my best interest to sign up for a health care plan.

I spent about two weeks using sites like ehealthinsurance.com comparing literally hundreds of plans with all kinds of different features until I found the one that suited me best.

I selected an HSA from Kaiser Permanente.  An HSA (Health Savings Account) is similar to an IRA, but for health care savings rather than for retirement.  A person enrolled in a HSA is allowed to contribute up to $3000 tax free each year to their account.

Under Federal law, these HSA’s must be paired with a HDHP (High Deductible Health Plan).  For example, my plan has a $1200 deductible, but everything after that is covered 100% by Kaiser.

I love my plan.

The point of having the high deductible plan is to encourage patients to keep their health care costs down.  If a customer knows that they have to spend the first $1200 of their health care expenses out of pocket, they are more likely to avoid unnecessary health care expenses.  Conversely, a health emergency is extremely unlikely to lead to major financial distress, as the maximum out of pocket expenditures are only $1200.

I mentioned above that an HSA is similar to an IRA and that I am legally allowed to contribute $3000 tax free to my account each year.  This allows individuals to save money for their future health care expenses.  For example, if I deposit the maximum of $3000, but only spend $1500, including all medical bills and over the counter and prescription drugs, I am left with a surplus of $1500 in my account.  This money can be kept in an interest bearing savings account, invested in a money market, or invested in the stock market.

This type of plan obviously doesnt suit everyone, but it is a great plan for people like me:  young, relatively healthy people with minimal health care costs.  Because I enrolled in this plan while young and healthy, I can use the unspent funds remaining in my account to save for when I am a sick old man with high health care costs.

In fact, while insurance premiums were expected to rise around 8% this year, my premium actually dropped by 3.6%!  It dropped because I kept costs for both me and my insurance company under control.

As I said above, I am an informed consumer who spent quite a long time comparing plans until I found the plan that I felt was best for me.  This plan has some great features, encourages saving and allows me to contribute money on a pre-tax basis.  It has also resulted in my premiums actually going down in a time when most people are seeing rather large increases.

My plan is great as it is, but if the government wanted to make health care more affordable, they would remove contribution limits on HSA’s, allowing consumers to place much more money in these plans.  They could also allow users of any health plan to enroll in an HSA, rather than limiting HSA’s only to those with high deductible plans.  Making these reforms would lead to lower costs for many Americans, and would create an incentive for the young and healthy to save money for the future when they face declining health.

Sadly, the Democrats’ health care plans will outlaw my health insurance plan.

I dont even understand why anyone would want to outlaw this plan–it really is great– but there seems to be a lot of things that I dont understand these days.  Are these Congressmen so conceited that they actually believe that they are capable of making a better decision about my own life than am I?  None of these people have ever met me.  None of them can possibly understand my health care needs better than I do.

Americanly Yours,

Phred Barnet

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President Obama has proposed universal health care in a new bill, yet given the law of supply and demand, it will result not only in lower quality of health care, but also in rationing. Let us just suppose that President Obama’s health care proposal sails through Congress today and is signed into law this evening.

Tomorrow morning we will all wake up in a world where everyone is covered with some form of medical insurance, including the approximately 50 million Americans currently without health coverage. Yet, the number of doctors, nurses, and medical staff will be the same tomorrow as it is today. Likewise, there will be the same number of hospitals, doctors’ offices, and medical care facilities as there is today.

It is worth remembering that our medical professionals are already strained, waiting rooms are crowded, emergency rooms are already plagued by long waiting times, and it often takes days to get an appointment to see a doctor.

Giving an additional 50 million Americans immediate access to the same number of medical professionals and facilities will flood our health care facilities and doctors with new patients, putting further strain on an already strained system. The result will be longer waits, more crowded doctors’ offices and hospitals, and a general decrease in the level of care.

Increasing the number of Americans with health care is a noble goal and is being pursued with the greatest of intentions. But as it is said, the road to hell is often paved with good intentions. There is no way around the fact that adding an additional 50 million people to the health care system will decrease the level of service being offered.

The current health care bill will succeed in giving more people health care, however it will result in much worse care for the over 80% of Americans who are currently covered.

This is an excellent example of the law of supply and demand. No matter what is done about health care, tomorrow’s supply of health care –the number of doctors, medical facilities, etc. – will be the same as today. Yet, implementing a nationalized health care system requires that tomorrow’s demand for health care increases dramatically. A sudden increase in demand without an increase in supply always leads to a shortage of the product in question.

In the free market, a shortage of goods causes prices for that good to increase to a level where those who cannot afford them are ‘crowded out’ of the market. The profit earned by the producers of the good encourages additional producers to enter the market. This creates an increase in supply and drops the price of the goods for all consumers. Under the President’s plan, however, demand will be raised without an increase in supply, whereby the government will be forced to allocate health care. When government bureaucrats make decisions on how goods and services should be allocated, rationing occurs.

Under the new government run health care system, the government will need to take measures to “keep costs low” in an effort to save American citizens money and prevent negative political fallout. While this also seems like a noble goal, the consequences will be devastating. Government mandated cost cutting measures also necessarily mean less profit for those who operate medical facilities.

Taking away the profit motive, will result in fewer people being willing to take risks and opening new medical facilities. Medical supply companies will be less willing to produce life saving medical devices, and the benefits of taking a medical education will diminish. The loss of profit motive will result in fewer services being shared among more consumers. This will lead to further rationing, rather than allowing market forces to make corrections.

Even the best of intentions can’t change facts. If Americans want to continue to have a decent health care system without government rationing, they must oppose universal health care coverage.

Americanly Yours,

Phred Barnet

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This is an interesting and humerus video on health care.  It compares the health care systems in the State of Georgia and Massachusetts.

You may recall that the health care plans being pushed by the Administration and Democrats in Congress are very similar to the provisions passed in Massachusetts’ 2006 health care reform bill.

While it may sound good to pass a bill that will subsidize a scarce resource (in this case health care), doing so always has consequences.  In this case, dropping the price of health care has led to an increase in the number of people taking advantage of these services, resulting in a massive shortage in services.  This in turn results in an increase in the price of services for those who are notable to take advantage of the government subsidy.  Watch:

What a great video!  Please pass that along to your friends.

Americanly Yours,

Phred Barnet

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Dont take my word for it:

“President Obama may mouth very different rhetoric,” said Anthony D. Romero, executive director of the American Civil Liberties Union. “He may have a more complicated process with members of Congress. But in the end, there is no substantive break from the policies of the Bush administration.”

Americanly Yours,

Phred Barnet

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The new nationalized health care bill from Senators Kennedy and Dodd just keeps getting worse.

According to the AP:  “Americans who refuse to buy affordable medical coverage could be hit with fines of more than $1,000 under a health care overhaul bill unveiled Thursday by key Senate Democrats looking to fulfill President Barack Obama’s top domestic priority.”

I thought this was America.  I thought this was the land of the free.  I thought that people in this Nation were allowed to live their personal lives as they choose.

Apparently I thought wrong.

Who do these Senators and this President think they are?

Congress and President Obama have no right to fine people for choosing not to purchase health coverage.

If the President and others can justify abortion by citing privacy rights and the right to choose, cant the same rights be applied to those who privately choose not to purchase health insurance?

And what will happen if you dont purchase health insurance and then you refuse to pay the fines?  Will the government have you thrown in prison?

In lingo straight out of the socialist phrase book, these fines will be called “shared responsibility payments!”

Shared responsibility payments?  Are you kidding me?  I share absolutely NO responsibility for the health and well being of others. The punishment for not purchasing health care coverage should come in the form of denied or increased cost for services rendered, not a government imposed fine.

Americanly Yours,

Phred Barnet

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