Free Market and Socialized Medicine - why not both?

[usmcstinger]

I am convinced that the free market would provide the best health care system if it were ever allowed to do so. Of course, we've had nothing like a free market in health care since the 1950s. First there were 'maximum wage' laws post WW2 that were meant to encourage hiring, but instead resulted in employers adding benefits like health insurance. Then health insurance became an entrenched interest, and insurance providers arranged for the government to leave that benefit untaxed, so it became standard. Then Medicare came about and kind of ruined everything.

Since the 1950's, state and federal agencies have added a huge maze of regulations governing all aspects of health care, making it into a paperwork nightmare that is total nonsense for doctors and patients. And lawyers have found that the courts are willing to award millions to people who want to sue their doctors. This in turn has resulted in higher costs, much more conservative medical practices, and a closed industry for providers of medical products.

States require insurance companies to cover all sorts of health issues, making insurance more expensive for everyone, especially healthy people. Now the federal government is getting in on that game too.

And all the while, the government keeps finding more ways to fund this mess. Governments now pay more for health care than consumers.

All this is to say we don't have a free market system at all. The USA just has its own uniquely stupid take on socialized medicine, and Obamacare is only making it more convoluted.

But it's a fantasy to think we could ever undo it. Voters aren't smart enough, the elderly benefit too much, and the interests are too powerful for us ever to unravel this mess and return to a free market system which would provide affordable, high quality health care for everyone.

What about a compromise? What if free market advocates drafted a plan where these things happened?
1) The US adopted a national health service, entirely funded by the government, ala Britain.
2) The same bill that created the national health service creates protected free market space for people who want to provide health care for a profit. The bill says that, so long as there is a national health service, there must also be space in the market for people to provide for-profit services with little to no regulation in a buyer beware environment. No federal, state, or local governments could restrict the activities of these companies, other than holding them to the law as it applies to every citizen. Voluntary interactions between patient and provider could be protected and they could do what they want.

That way, there would be a fully socialized system, which is what the voters want, and which we're already paying for, and there would be an opportunity for people to opt out of it if they're willing to pay.

If you ever had a rational thought, it would die of loneliness.

 

[Dragonlady]

"The nonpartisan Fraser Institute . . . . . "

The Fraser Institute is not nonpartisan. Far from it. It's a far right, libertarian thnk tank, opposed to public heath care and education. The Institute produces a plethora of reports decrying the state of Canada's education and health care systems in the most dire "sky is falling" terms.

I saw that report and where it came from and immediately wondered about that numbers. I wasn't able to find a more reliable recent number (and I did look). I did find a well researched report which basically says that almost no one is going to the US for care but that article is from 2002 and uses data from 1993 to 1998. It's very difficult to believe that these numbers would skyrocket to the levels claimed by the Fraser Institute in such a short time.

Phantoms In The Snow: Canadians

The study, which is called "Phantoms in the Snow" concludes:

Despite the evidence presented in our study, the Canadian border-crossing claims will probably persist. The tension between payers and providers is real, inevitable, and permanent, and claims that serve the interests of either party will continue to be independent of the evidentiary base. Debates over health policy furnish a number of examples of these “zombies”—ideas that, on logic or evidence, are intellectually dead—that can never be laid to rest because they are useful to some powerful interests.23 The phantom hordes of Canadian medical refugees are likely to remain among them.

Here's another article from the Denver Post debunking the garbage lies so often told:

Debunking Canadian health care myths - The Denver Post

Last but certainly not least, a right-wing Republican woman's blog about her experience in the hell of Canadian health care. I post this because this she eloquently expresses why our system works and has such great outcomes for Canadians:

How I lost my fear of Universal Health Care

I suspect, given the Institute's right-wing partisanship, and the timing of its release just as the US Election Campaign was heading into the party conventions, that of the Fraser Institute's report was written to help frighten US voters into voting for Romney.

 

[KissMy]

I stopped reading your post at this paragraph. Go read H.R.3200 page 6 & I forget what other pages right now. It was designed to kill off all health insurance companies forcing everyone onto the "government option"! If someone became uninsured at any point in time for any reason, they had to go onto the government plan & could not go back to private insurance.

Bullshit. Not only did H.R. 3200 not saying anything anywhere about forcing anyone to choose the public option, it explicitly clarified that no one is ever required to enroll in the public option.

SEC. 229. ENROLLMENT IN PUBLIC HEALTH INSURANCE OPTION IS VOLUNTARY.
Nothing in this division shall be construed as requiring anyone to enroll in the public health insurance option. Enrollment in such option is voluntary.

That bill's been dead for over three years and yet the lies linger on.

Page 16 of H.R.3200

10 (1) LIMITATION ON NEW ENROLLMENT.—
11 (A) IN GENERAL.—Except as provided in
12 this paragraph, the individual health insurance
13 issuer offering such coverage does not enroll
14 any individual in such coverage if the first
15 effective date of coverage is on or after the first
16 day of Y1.

Do you still think it is optional? This will cause private insurance pools to shrink until that company goes out of business forcing everyone onto the option-less government plan. I happen to like my HSA plan. I negotiated my doctors visit down to $40. That is about the same as the co-pays on the expensive plans. I am now 46 years old & only pay $68 a month for health insurance with no max limit, a max $2500 out of pocket. When I got insurance at my old job 10 years ago at age 35 it cost $255 a month plus endless co-pays, 80% coverage, $1 million limit & no max out of pocket. Doctor visits always exceeded $120 on that plan 10+ years ago.

 

[TakeAStepBack]

For the very simple reason that everyone would still have to pay the national system tax. They would never agree to people opting out. So free enterprise can not co-exist. Who would pay a heavy tax to fund the national system, and then pay again for a free system. The competition isn't there to keep such a free market option viable. It would quickly become a second choice monopoly. Because it would be those opposing the national service, but paying, and those who can't afford both.

But I think this does happen. We do pay a heavy tax to fund a national system now, and people spend extraordinary amounts of money on whatever health care they can get their hands on outside of the system in a desperate attempt to get some sort of decent medical attention. Right now, only alternative health is free from onerous regulation so it can thrive, and people go to acupuncturists and chiropractors in droves.

If the government is going to tell the care providers what they can and can not do, or that they too must pay into the national system, then the there is no free market system or anything even remotely close to it.

What you're suggesting is that people pay in, and then go ahead and find alternatives if they can. It will still happen that way once Obama Tax kicks in, but not on any scale large enough to say that it can compete with the govt. burdened system of crony socialism.

 

[Dragonlady]

Page 16 of H.R.3200

10 (1) LIMITATION ON NEW ENROLLMENT.—
11 (A) IN GENERAL.—Except as provided in
12 this paragraph, the individual health insurance
13 issuer offering such coverage does not enroll
14 any individual in such coverage if the first
15 effective date of coverage is on or after the first
16 day of Y1.

Do you still think it is optional? This will cause private insurance pools to shrink until that company goes out of business forcing everyone onto the option-less government plan

You are reading this section out of context and have completely misconstrued its meaning. In your defense, unless you're a lawyer or a law clerk, it would be very difficult to comprehend. I had to read it twice, and the second time, I went back to the beginning of Section 101 on page 14 and read from there to fully grasp the meaning, but not only did this section protect your right to choose your own coverage, it did so in spades. I'll explain what's it's saying without all of the legalese.

Section 101 says that all new insurance policies issued on or after the commencement of Year 1 ("Y1") must contain certain basic coverages and conditions under the Act and it refers the reader to to other sections for the details of what must be included. If your existing health insurance policy doesn't meet those minimum standards set out in Section 101, your insurance company could no longer sell it after Y1.

Section 102 protected the consumer from losing their existing policy if they wanted to an keep it. Even if your existing health insurance policy does not meet the minimum standards set out in Section 101, you would not have to change your coverage. You can keep that old policy, provided it's not issued after Y1 It can be renewed after that date, but the coverage must be in place and continous or the old policy is dead.

What you are reading as a requirement to move to the public option, is in fact the opposite. It's saying you DON'T have to lose your existing policy ever, even if it doesn't meet the new standards and you can even add family members to it, but the policy which cannot have been issued after Y1. The Section you quoted, only relates to existing policies which are "grandfathered" into the new Act.

Looks like Faux News lied to you . . . again.

It's really too bad you lost that public option. I read the whole section and it would have awesome. You are correct that it would have decimated the private market, but I consider that a GOOD thing.

 

[KissMy]

I helped my lifelong neighbor move last week. He was going through his file cabinet looking at old doctor bills & canceled checks. Like the rest of us he never had insurance. He paid the entire bill every visit. It only cost $2 an office visit in the 1970's. His wife took their 2 boys in to get shots & physical for school & the entire bill for both kids was $6. The medicine was always included in the office visits.

Now we have government, employers, insurance companies & pharmacist in between us & the doctors. The cost has skyrocketed. The HSA policy that let us negotiate with doctors, pay cash with no paperwork cuts cost 70%. Plus that stupid EMTLA law forcing doctors to treat people for free, has them overcharging us that pay.

I happen to like my HSA plan. I negotiated my doctors visit down to $40. That is about the same as the co-pays on the expensive plans. I am now 46 years old & only pay $68 a month for health insurance with no max limit, a max $2500 out of pocket. I even got a rebate on my $68 premium. When I got insurance at my old job 10 years ago at age 35 it cost $255 a month plus endless co-pays, 80% coverage, $1 million limit & no max out of pocket. Doctor visits always exceeded $120 on that plan 10+ years ago.

 

[pinkwaxfish]

If the government is going to tell the care providers what they can and can not do, or that they too must pay into the national system, then the there is no free market system or anything even remotely close to it.

What you're suggesting is that people pay in, and then go ahead and find alternatives if they can. It will still happen that way once Obama Tax kicks in, but not on any scale large enough to say that it can compete with the govt. burdened system of crony socialism.

Okay, yes, what I'm proposing is not a true free market. I'm also proposing that a true free market cannot exist in conjunction with democracy in America. I'm convinced in Mancur Olson's arguments that, over time, in a stable society interest groups will form and start meddling with any free market arrangements that exist. It's inevitable.

So what do we do? Do we just lament that it sucks? Do we tell people how much better a real free market can be, knowing it can never come about?

I've seen evidence that government can legislate itself out of the way in limited form from time to time. That's what I'm proposing here. What if, in one system, the government funds it and in order to play you have to get all the credentials approved by the government trade unions like the AMA and you have to comply with all the regulations, but at the same time, the government creates a new type of entity that gets specific government protections--in this case, if you set up this type of company, you get to provide health care services and are not subject to all the regulations, but you also cannot accept any government money at all for your services?

 

[TakeAStepBack]

Sounds good, but do you really see the government, especially in its current form, allowing sucha thing to transpire? And if so, what would the demand be like? Because every time the govt. steps in to take over a sector of the economy, it never relinquishes that control. I certainly dont see this govt. going out of its way to form a psuedo-free market version of healthcare where it can not reap the power and money to control how it works down to the last strings.

It's a good idea in theory, but in reality I don't see it coming about.

 

[dblack]

... I'm convinced in Mancur Olson's arguments that, over time, in a stable society interest groups will form and start meddling with any free market arrangements that exist. It's inevitable.

I don't recall Olson using the term, but corporatism is where his theories predict we're heading, and I fear he's right. The one thing Olson didn't seem to get, in my view, is the role that diminishing constitutional limits on government play in hastening the entrenchment of organized interest groups. The fear provoked by unlimited government power (the result of removing Constitutional limits) prompts us to support organized voting blocks that can 'defeat' those we disagree with. It's the core of 'lesser-of-two-evils' thinking.

So what do we do? Do we just lament that it sucks? Do we tell people how much better a real free market can be, knowing it can never come about?

I've seen evidence that government can legislate itself out of the way in limited form from time to time. That's what I'm proposing here. What if, in one system, the government funds it and in order to play you have to get all the credentials approved by the government trade unions like the AMA and you have to comply with all the regulations, but at the same time, the government creates a new type of entity that gets specific government protections--in this case, if you set up this type of company, you get to provide health care services and are not subject to all the regulations, but you also cannot accept any government money at all for your services?

You've gone to great pains to explain that you're not proposing this as an ideal solution, but a possible way out of the pending disaster of PPACA's really bad solution. And I think you're on the right track.

But it seems, to me, exceedingly unlikely that the same government that legislated ACA, would let the power to dictate our health care slip through their fingers. They don't want people being responsible for their own health care. They want to build a dependency relationship that government (and it's corporate 'partners') can control.

 

[TakeAStepBack]

I don't recall Olson using the term, but corporatism is where his theories predict we're heading, and I fear he's right.

He is right. We already have corporatism heavily inbedded in the special interest group Liberalism (on both sides, that's not a call out to LOLberals) that has replaced social Liberalism (which replaced classical liberalism).

It's in our banking, our agriculture, exports, chain stores, etc..etc..etc..etc.. and , healthcare.

Big Pharma
Monsanto

The list is endless. The question becomes, what can we do to mitigate the terrible effects that corporatism has on both economic/individual freedoms, and also our constitutionally limited govt.?

I don't have an answer except, that it completely has to fall apart and be built back up.

 

[Dragonlady]

I happen to like my HSA plan. I negotiated my doctors visit down to $40. That is about the same as the co-pays on the expensive plans. I am now 46 years old & only pay $68 a month for health insurance with no max limit, a max $2500 out of pocket. I even got a rebate on my $68 premium. When I got insurance at my old job 10 years ago at age 35 it cost $255 a month plus endless co-pays, 80% coverage, $1 million limit & no max out of pocket. Doctor visits always exceeded $120 on that plan 10+ years ago.

This is where Canadians start laughing and here's why:

I have never discussed money with my doctor. I've certainly never negotiated with him, but then I've never taken him up on his offer of cheap botox either. (OHIP doesn't pay for botox). There are no co-pays for doctors.

I am a 63 year old asthmatic, and I could stand to lose a few pounds. I pay $25 a month for health insurance. When I turn 65, I'll pay nothing and my dental and prescriptions will be covered too with a co-pay of $2. No caps on treatments, no co-pays to doctors or hospitals. It's all good.

My ONLY complaint is that my doctor only sees botox patients on Friday afternoons so Lord help you if you wake up sick on Friday morning and want to get in to see him before the weekend. I managed to get in but only because I refused to take no for an answer. Imagine my surprise when I ran into a lawyer I used to work for who was just going out as I was coming in. He probably thought I was there for botox too.

 

[Oddball]

Because socialism relies upon coercion and and central control, while the free market utilizes consent and decentralized choices.

I'll add to that the promoters of Socialized Medicine will use the political process to rent seek/seek subsidies from the Free Market Medical Providers.

I'm sure that this is true, but I think, in the absence of a better solution (and I don't see anything good coming down from Washington anytime soon), I think some degree of protection for free market providers is possible. I'm thinking of how China legislated free markets in their special economic zones, and even though rent seekers and interest groups interfered in predictable fashion, they still got a lot of good out of those special economic zones.

Problem being that the socialistic central controllers need the funds from those utilizing the system the least (i.e. the healthy), to subsidize those whom they best deem to be the recipients of the largesse...You pay, they distribute, and if you don't get what you need, the state probably has probably made P&L calculation of your value to the state.

But dare not call them "death panels"...Nope, don't do it.

 

[KissMy]

I happen to like my HSA plan. I negotiated my doctors visit down to $40. That is about the same as the co-pays on the expensive plans. I am now 46 years old & only pay $68 a month for health insurance with no max limit, a max $2500 out of pocket. I even got a rebate on my $68 premium. When I got insurance at my old job 10 years ago at age 35 it cost $255 a month plus endless co-pays, 80% coverage, $1 million limit & no max out of pocket. Doctor visits always exceeded $120 on that plan 10+ years ago.

This is where Canadians start laughing and here's why:

I have never discussed money with my doctor. I've certainly never negotiated with him, but then I've never taken him up on his offer of cheap botox either. (OHIP doesn't pay for botox). There are no co-pays for doctors.

I am a 63 year old asthmatic, and I could stand to lose a few pounds. I pay $25 a month for health insurance. When I turn 65, I'll pay nothing and my dental and prescriptions will be covered too with a co-pay of $2. No caps on treatments, no co-pays to doctors or hospitals. It's all good.

My ONLY complaint is that my doctor only sees botox patients on Friday afternoons so Lord help you if you wake up sick on Friday morning and want to get in to see him before the weekend. I managed to get in but only because I refused to take no for an answer. Imagine my surprise when I ran into a lawyer I used to work for who was just going out as I was coming in. He probably thought I was there for botox too.

But you guys did not have EMTLA without charging everyone an insurance premium/tax. Our system got really skewed after that. It will take a long time to turn it around. If from the start we enforced an insurance tax along with the EMTLA, things would be fine. Reagan was an idiot for signing the mandatory EMTLA without funding it with mandatory insurance premium. When he signed that law it only cost $2 to go to the doctor without any insurance. Now the cost is beyond belief. HSA insurance is the best way to drive down cost. The insured would demand the doctor charge less or they would shop around for the lowest price. It has worked for me. My cost are now 1/3rd of what they were 10 years ago when I was young & on the company plan.

 

[Greenbeard]

Page 16 of H.R.3200

10 (1) LIMITATION ON NEW ENROLLMENT.—
11 (A) IN GENERAL.—Except as provided in
12 this paragraph, the individual health insurance
13 issuer offering such coverage does not enroll
14 any individual in such coverage if the first
15 effective date of coverage is on or after the first
16 day of Y1.

Do you still think it is optional? This will cause private insurance pools to shrink until that company goes out of business forcing everyone onto the option-less government plan. I happen to like my HSA plan. I negotiated my doctors visit down to $40. That is about the same as the co-pays on the expensive plans. I am now 46 years old & only pay $68 a month for health insurance with no max limit, a max $2500 out of pocket. When I got insurance at my old job 10 years ago at age 35 it cost $255 a month plus endless co-pays, 80% coverage, $1 million limit & no max out of pocket. Doctor visits always exceeded $120 on that plan 10+ years ago.

To put very simply what Dragonlady already said: you're looking at a section that is specifically about grandfathered health plans. Plans that are not subject to some of the regulatory changes made by the legislation.

Of course you can't newly enroll in grandfathered coverage you don't already have. That doesn't mean you can't buy a private insurance plan, it means if you buy a new private plan it's going to be subject to the law.

Again, it doesn't particularly matter as H.R. 3200 never became law, but almost assuredly everything you ever heard about that bill was a lie. It didn't require anyone to enroll in the public option, nor did it forbid new enrollment in private insurance, nor did it do any of the other dozens of things you heard it did.

 

[dblack]

... I don't have an answer except, that it completely has to fall apart and be built back up.

While that wasn't necessarily his "prescription", Olson's historical analysis showed that's usually the remedy.

 

[pinkwaxfish]

I am convinced that the free market would provide the best health care system if it were ever allowed to do so. Of course, we've had nothing like a free market in health care since the 1950s. First there were 'maximum wage' laws post WW2 that were meant to encourage hiring, but instead resulted in employers adding benefits like health insurance. Then health insurance became an entrenched interest, and insurance providers arranged for the government to leave that benefit untaxed, so it became standard. Then Medicare came about and kind of ruined everything.

Since the 1950's, state and federal agencies have added a huge maze of regulations governing all aspects of health care, making it into a paperwork nightmare that is total nonsense for doctors and patients. And lawyers have found that the courts are willing to award millions to people who want to sue their doctors. This in turn has resulted in higher costs, much more conservative medical practices, and a closed industry for providers of medical products.

States require insurance companies to cover all sorts of health issues, making insurance more expensive for everyone, especially healthy people. Now the federal government is getting in on that game too.

And all the while, the government keeps finding more ways to fund this mess. Governments now pay more for health care than consumers.

All this is to say we don't have a free market system at all. The USA just has its own uniquely stupid take on socialized medicine, and Obamacare is only making it more convoluted.

But it's a fantasy to think we could ever undo it. Voters aren't smart enough, the elderly benefit too much, and the interests are too powerful for us ever to unravel this mess and return to a free market system which would provide affordable, high quality health care for everyone.

What about a compromise? What if free market advocates drafted a plan where these things happened?
1) The US adopted a national health service, entirely funded by the government, ala Britain.
2) The same bill that created the national health service creates protected free market space for people who want to provide health care for a profit. The bill says that, so long as there is a national health service, there must also be space in the market for people to provide for-profit services with little to no regulation in a buyer beware environment. No federal, state, or local governments could restrict the activities of these companies, other than holding them to the law as it applies to every citizen. Voluntary interactions between patient and provider could be protected and they could do what they want.

That way, there would be a fully socialized system, which is what the voters want, and which we're already paying for, and there would be an opportunity for people to opt out of it if they're willing to pay.

If you ever had a rational thought, it would die of loneliness.

What a strange comment. Care to elaborate?

 

[pinkwaxfish]

... I don't have an answer except, that it completely has to fall apart and be built back up.

While that wasn't necessarily his "prescription", Olson's historical analysis showed that's usually the remedy.

Yes, and maybe that's the only way it goes. Kind of seems like that's the great public policy problem of our time. How do we break up entrenched interests who use the government to everyone else's detriment without a painful explosion?

Or maybe...how do we create the explosion without making it so painful?

 

[KissMy]

The introduction of HSA Insurance in 2003 flattened the rising cost of health-care. Also Clinton must have done something or scared the healthcare industry while in office because there was a major flattening of cost until Bush came in.

Also we have fewer doctors enrolled in med school even though med school application rates have risen. The AMA is limiting doctors to keep doctor pay high. The AMA is a basically a Doctors Union.

 

[Dragonlady]

Yes, and maybe that's the only way it goes. Kind of seems like that's the great public policy problem of our time. How do we break up entrenched interests who use the government to everyone else's detriment without a painful explosion?

Or maybe...how do we create the explosion without making it so painful?

The problem is the entrenched interests have an almost limitless amount of money and they lie and lie and lie to protect them. The entrenched interests in the United States - big insurance, the AMA, and big pharma, are three of the wealthiest lobbies in the country and their continuing income and profits are dependent upon the status quo. Because they have the money to buy air time, lobbiests, and PR firms, they spend a lot of time and money frightening people about government funding single payer health care systems.

Try talking to Canadians about their health care system. Does it sound anything like the story you get from the US media? Thousands of people crossing the border for US health care, long waits for care, people dying after spending years on waiting lists. All lies, but repeated often enough, Americans live in fear they'll end up with a system like Canada's.

American's would build shrines to Obama until the end of time if he could give them a health care system like Canada's. Canadians recently named the founder of the Canadian Health Care system, Tommy Douglas, as the greatest Canadian who ever lived. He beat out Wayne Gretsky, and that's saying something.

 

[auditor0007]

Free Market is available in some countries that have single payer, for those who want a private room and gourmet meals.

It's available in the UK. I love their system. Everyone is fully covered, but if you want to pay extra, you can get the gold treatment with a private supplemental health insurance policy. Even if you decide on paying for private insurance, it's less than what we pay here in the US.