The Functional Libertarian
April 11, 2013
Today under the federal government’s “leadership” our nation’s healthcare system is a disaster. For example, we often pay several times more in the United States for the same prescription drugs that are sold in other countries; an average MRI here costs $1,080, while it only costs $510 in Germany; and doctors here charge twice as much for hip replacement surgery as do doctors in Australia. In the meantime, more people in our country actually die of treatable diseases like diabetes and childhood infections than in any other Western industrialized nation. And now under the so-called Affordable Healthcare Act (ACA) the situation will get even worse.
How has this been allowed to happen? Because the government continues to meddle with our healthcare system, and that has driven up the prices and also reduced the number of healthcare professionals that are available to treat us.
The Functional Libertarian solution is to get the government out of healthcare for people who can take care of themselves, and then set up a health safety net system for those who cannot.
During my youth in the 1950s and early 1960s, it was not even a topic of conversation that we could not obtain good healthcare for reasonable prices, and we had all of the hospital emergency rooms we needed. But then in 1965, President Lyndon Johnson caused Medicare to be passed, and that began the government’s steadily increasing intrusion into healthcare. As a result, the government virtually dictates what insurance companies must cover, and how much each procedure will cost – to the detriment of everyone.
Today virtually the only variable cost in our healthcare system is what the Medicare and insurance companies will reimburse to the healthcare professionals, and, as we have seen, that continues to decline. This, in turn, has reduced the number of healthcare professionals willing to work for less money. Of course, since the doctors are reimbursed according to the number of tests and treatments they provide, most of the doctors still remaining in the system get around that by running – and charging for – more marginally necessary tests and procedures, which radically increases the cost of healthcare. So we are losing both ways!
So now in January of 2014 the AFA is scheduled to come into full effect for companies that employ 50 or more employees. But, as Ayn Rand once said, “You can’t fake reality,” or at least not forever. So hold onto your hats, because these will be the results with the full AFA:
1. The insurance premiums in California, for example, for the 1.3 million unmarried and married people who earn more than $45,000 and $94,000 per year, respectively, and who cannot buy insurance through their work, will increase by an average of 30 percent.
2. Many companies that currently have somewhat more than 50 employees will reduce that level to 49 so that they can escape the new requirements of providing health insurance to their workers. These companies they are being labeled as “The 49ers.”
3. Many other companies with 50 or more employees will simply choose to pay the required fine instead of providing health insurance. That fine is currently estimated to be about $2,000 per employee, which is much less than the insurance would cost the companies. Of course, that will add to the number of workers who cannot purchase insurance through their work.
4. Insurance companies will be required to cover a larger number of healthcare services, and also to accept smaller co-pays from their insureds. This will result in either larger premiums, or insurance companies going out of business, which will further reduce competition.
5. Yes, it is true that the insurance costs will come down for lower-income consumers, and insurance will also be provided to some 30 million people who now are uncovered. And, of course, these people lobbied hard for this result, once again proving the maxim that if you are going to rob Peter to pay Paul, you can always count on the support of Paul. But, as a practical matter, we don’t have enough medical doctors and other healthcare professionals now even to take of Medicare and Medicaid patients. So these new people will probably end up having insurance that no healthcare professional of any skill level will take. What good will that do?
In other words, if you want your healthcare to be run like the Department of Motor Vehicles, you are increasingly close to getting your wish.
But if we could get the government out of the healthcare for people who can take care of themselves, that would result in people being much more careful in spending their own money, just like when I was growing up. And this would once again turn most doctors into entrepreneurs, which would also, in turn, would bring prices down and quality up. This result is graphically shown in two areas today in which anyone can get good quality medical services for competitive prices, which are Lasik and cosmetic surgery. Why? Because the government and insurance companies are not involved.
But what about the poor? I was in the Peace Corps – I care about people, and so do most Functional Libertarians and others. The answer is to implement a safety net system for people who cannot medically take care of themselves – not because we legally have to, but because we want to. Why? Because that is who we are.
What form would this take? We could establish a network of medical clinics and hospitals on private contract with the government, similar to the Kaiser Permanente plan. Then people who could not afford to take care of themselves could, with a small co-pay to make sure that the visit was medically necessary, receive quality medical care. Yes this would be expensive, but not nearly as much as the present healthcare program. So in the end the government would be paying for doctors, nurses, hospitals and medicines, instead of administration, bureaucracy and fraud.
Some people call this socialized medicine, and maybe so. But I lived under such a system for four years in that great socialistic institution called the United States Navy, and it worked pretty well. In fact, my firstborn son was born at the Naval Hospital in Guam, and the care was fine. (We named him William P. Gray after my wonderful father, but always threatened to call him Guamo.) We could also join this new proposed medical system with the current one we provide for the military and our Veterans.
Finally, those people who are financially” in between” could choose to go to the government clinics, but make a higher co-pay.
Of course this is a complicated and often emotional subject. But the very best way to provide the people in our country with quality healthcare at competitive rates can only be achieved by getting the government out of the healthcare oversight business. If you focus on our healthcare history, and on reality, I feel sure you will agree.
James P. Gray is a retired judge of the Superior Court in Orange County, California, the author of “A Voter’s Handbook: Effective Solutions to America’s Problems” (The Forum Press, 2010), and the 2012 Libertarian candidate for Vice President, along with Governor Gary Johnson for President. Judge Gray can be contacted at [email protected].
“What form would this take? We could establish a network of medical clinics and hospitals on private contract with the government, similar to the Kaiser Permanente plan. Then people who could not afford to take care of themselves could, with a small co-pay to make sure that the visit was medically necessary, receive quality medical care. Yes this would be expensive, but not nearly as much as the present healthcare program. So in the end the government would be paying for doctors, nurses, hospitals and medicines, instead of administration, bureaucracy and fraud.”
Right on Judge Gray. But please take this reasoning a little further….and you’ll come to the right place. Do you really want some company like Kaiser on contract with the government? Consider the potential for corruption. Why not make room for the (innovative) little guy in health care and get rid of the cartels?
What we need is room for small business in health care and true competition.
The solution is obvious–single-payer health-care. It can be run nationally or locally.
With (the right kind of) single-payer, the consumer has true freedom to choose their doctor, as opposed to the limitations and costs imposed by the health cartel system. Small business and ethical independent physicians have room to operate.
This allows the free market to actually work. People will support the doctors and treatments that work for them. If combined with free (or drastically reduced) medical education and deregulation allowing a greater variety of medical practices, then we can cover everyone for far less than what we pay today. The health insurance cartels, the AMA, the prescription drug companies, and the government are all in one big dirty boat and it’s time to overturn that boat and create a system that actually benefits the people. If the system is not about profits for the few, then there is much more incentive for doctors to focus on nutrition and long-term preventative care.
If Americans were educated on the true benefits and freedoms of universal health care, they would demand it. But the same cartels that control the media also control health insurance. So we continue to overpay, ignorantly thinking this is a free-market process, when in fact it is a mafia practice.
If people like Gary Johnson and Judge Gray really want to offer an alternative then they should endorse single-payer as the most efficient and humane system available to us.