Americanly Yours

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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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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Senators Chris Dodd and Ted Kennedy have introduced a new health care bill to the Senate.  This bill will keep the same basic government run insurance plan as their previous bill.  Yet, this new plan also hits “large” businesses (defined as businesses with over 25 employees!!!) with “fines” of $750 for failing to provide employees with health insurance. The bill’s authors argue that this “fine” will force businesses to provide their employees with health care and will save the government money.  According to Senators Christopher Dodd and Ted Kennedy, this bill “virtually eliminates the dropping of currently covered employees from employer-sponsored health plans.”

Senators Dodd and Kennedy are either lying or are unbelievably stupid.

In fact, this bill only encourages employers to drop coverage for their employees.  According to the National Coalition on Health Care, “The annual premium for  single coverage [employer health plans] averaged over $4,700.^“

Under this plan, employers can drop their employees coverage, knowing that the government will pick up the tab.  Doing so will result in a “fine” of $750 per full time worker, but will actually result in cost savings around $4000 per employee!  This is a massive subsidy for corporations who choose not to insure their employees.

This plan will encourage employers to abandon their private insurance plans knowing that their employees will still be covered.  This will lead to a “race to the bottom” among companies because dropping coverage will lead to massive cost savings.

For example, at the end of last year Microsoft employed around 56,000 workers in America.  If they were to drop all of their employees’ health care plans, they would be subjected to fines of around $42 million  However, considering that the average health care plan costs employers around $4,700 per person, Microsoft would actually save around $221.2 million per year–after paying the “fines” by dropping coverage.

This new bill is a rotten one that will destroy private health insurance.  It will cause employers to drop coverage for their employees and will result in more Americans using the government “option.”

This bill will cost Americans a lot of money, will subsidize corporations who drop employee coverage, and will destroy the private insurance industry.  This bill will be ironically called the “Affordable Health Choices Act.”  Please call your Senator at 1-800-833-6354 and voice your opposition to this bill.  It will only take you two minutes.

Americanly Yours,

Phred Barnet

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In debates on health care, one number seems to pop up repeatedly:  the claim that 45 million Americans are uninsured.  Proponents of government controlled health care argue that it is immoral to allow approximately 15% of our fellow citizens to be left without health care.

But, there is something that they arent telling you:  many (if not most) of those without health care in this country choose to not have health care.

Yes, at least 45 million Americans are not currently insured (according to most studies, but Ill get back to that later), but a closer look at the numbers tells a different story than the one that you have probably been told in the past.

I recently read John C. Goodman’s paper titled “Solving the Problem of the Uninsured,” and although I do not support the same solution that he does, I found his paper to be quite interesting.

Dr. Goodman took a hard look at the numbers and facts about the uninsured in this country and found some surprising information.

He wrote that the lack of health insurance can be compared to an experience like unemployment–many people experience it at one time or another, but it rarely is a long term problem.  For example, “75% of uninsured spells are over within 12 months.  Less than 10% last longer than 2 years.”

Many of the uninsured are actually eligible for government or job related health care, but chose not to that advantage of it: “there are between 10 and 14 million people who are theoretically eligible for Medicaid and SCHIP (for low income families who do not qualify for Medicaid) but do not bother to sign up.  This is almost one in every four uninsured persons in the country.”

“Furthermore, in most places people are able to enroll in Medicaid up to 3 months after they receive medical treatment.  Because these people can enroll at the drop of a hat, even after they have incurred medical expenses, are they not de facto insured even without the necessity of formal enrollment?”

“A lot of other people are also voluntarily uninsured.  For example, about 9 million people (more than one in five of the uninsured) are eligible for employer insurance and decline to enroll even though the employer share of the premium is usually nominal.”

Many of the uninsured in America actually have the money to purchase insurance, but for one reason or another chose not to:

“The largest increase in the number of uninsured in recent years has occurred among higher-income families.”

“Further, over the past decade, the number of uninsured increased by 54% in households earning between $50,000 and $75,000 and by 130% among households earning $75,000 or more.  By contrast, in households earning less than $50,000 the number of uninsured decreased approximately 3%.”

“Some information about middle-class families who are voluntarily uninsured is provided by a California survey of uninsured with incomes of more than 200% of poverty.  Forty percent owned their own homes and more than half owned a personal computer.  Twenty percent worked for an employer that offered health benefits, but half of those declined coverage for which they were eligible.  This group was not opposed to insurance in general, however, because 90% had purchased auto, home, or life insurance in the past.”

Now, lets add all of this up:  we have 10-14 million who are eligible for Medicaid or SCHIP, but do not enroll, and an additional 9 million that are eligible for benefits at work but do not sign up and we have between 19 and 23 million people in these two situations alone who are eligible for health insurance, but decline (or choose not to sign up for) it.

This takes a huge chunk out of the original 45 million number, bringing it down to a range between 22 and 26 million people who are uninsured and do not have the option to become insured.  This is a much smaller number, especially when you remember the above statistics that the vast majority of people who are uninsured are uninsured for less than a year.

But, there are also several reasons to doubt the 45 million number itself.  Dr. Goodman’s study cites a study by the CBO which “estimated the actual number of uninsured may be as low as 21 million.”  He also cites “another report [which] finds that, even using Census Bureau methods, the 45 million number is about 25% too high, or off by 9 million people.”  So, if those studies are correct, we have reduced the number of uninsured to 21-36 million.

And, if (and this is THE BIG IF) those two studies that he cited are correct and the number of uninsured is actually between 21-36 million, then it is safe to say that there is no major “insurance crisis” going on in this country.

Why?  Well, at least 19-23 million Americans are eligible for health insurance or coverage but do not take advantage of it.  Combining these numbers and the above numbers from the two studies (one of which came from the CBO), we are left with a range of anywhere from -2 million to 13 million uninsured.  13 million might seem like a huge number, but it is only around 4% of our population (and remember 13 million was the maximum).  There has got to be a way to take care of this small percentage of Americans that will cost less than President Obama’s $1,000,000,000,000 [$1 trillion] health care initiative.

Americanly Yours,

Phred Barnet

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