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CAN THE FREE MARKET RESCUE THE AMERICAN HEALTH CARE SYSTEM?
10/26/2007
PART THREE: THE CONSERVATIVE APPROACH
Two quotations regarding his position on health care appear on Mitt Romney's website:
"It's a conservative idea, insisting that individuals have responsibility for their own health care."
"We can't have as a nation 40 million people - or, in my state, half a million saying 'I don't have insurance, and if I get sick, I want someone else to pay.' "
These statements sum up Republican attitudes towards the American people and their participation in the American health care system. These attitudes are that everyone must pay their own way, no matter what, and that those who don't have health insurance are moochers who only want to freeload off of the government and thus their fellow citizens.
YOU'RE ON YOUR OWN
I don't know a single Republican OR Democrat who doesn't believe in personal responsibility. In a perfect world, where health care was affordable to everyone including the most poor, every Democrat I know would expect each family to buy their own health insurance. But we don't live in a perfect world and this is where Republicans and Democrats part ways. Republicans think the reason the world isn't perfect is because too many people are lazy and don't want to take care of themselves. They seem unable to grasp the complexity of reasons, outlined in the two previous essays, that so many Americans are unable to afford health insurance. Democrats, on the other hand, realize the world isn't perfect because of a variety of factors, some of which are not one's fault, and cannot be overcome on one's own.
The truth about why someone does or doesn't have health insurance cannot be found by judging their personal responsibility.
Most people who have good health insurance get it through their employers who purchase policies at lower group rates. Individual policies are generally sold at much higher rates, and rather than coming from a benefit package separate from one's wages at work, must be paid for out of one's wages. Because of the rising cost of individual policies, many of those people who now receive insurance coverage as a benefit would be unable to afford health insurance if they were laid off, or if their employers stopped providing it. This is what has happened to many people. And if any of those people were to have medical issues, such as diabetes, hypertension, cancer or heart disease, they would be unable to afford a policy, if they were even offered one.
The implication in Romney's two statements is that most uninsured people go without insurance voluntarily. This is simply ridiculous. Given the choice between having health insurance and not having health insurance, I can't imagine many people choosing to go without and then relying on the good fortune to remain healthy, or the charity of hospitals and doctors if they get sick. And even if they would do that for themselves, they wouldn't want to do that for their children. Children are vulnerable and dependent on their parents to care for them. And they get sick a lot. I don't know a single parent who would put his or her children at risk just to mooch off the government. The majority of Americans simply aren't like that and it is insulting for Romney to imply that they are.
Romney, and all the other conservative Republicans who share his mindset, reminds me of a young boy who lived next door to my family when I was a teenager. One day his elderly grandmother was in the backyard and opened the gate to go into the front yard. The gate's hinges had come loose (mostly because the boy spent a great deal of time swinging from the gate) and the gate fell on the grandmother. She cried out to her grandson to come help her, whereupon he looked out his bedroom window at her and said "You broke it, you fix it."
A lot of Americans are in the same position as that elderly woman. They did nothing wrong and yet things come crashing down on them. Then when they do not have the resources to help themselves, they are told by the Republicans that they must be more responsible. Just like the woman who needed some assistance to remove the door that had fallen on her, many who lack health insurance need assistance from the community, which in this case because of the enormous expense of health care today can only be the government.
HEALTH CARE MOOCHERS
Romney's statement also implied that the people in his state who were uninsured wanted someone else to pay when they got sick. Yet we can say the same of the insured. The whole point of having health insurance is to get someone else to pay, isn't it? Can't we at least agree on the fact that very few people in this country could afford the medical bills themselves if they had to have surgery, or were in a devastating accident, or developed a chronic and serious medical condition? All Americans, therefore, depend on someone else paying for their treatment. The only difference is how they arrange it.
Many Americans stay at a job they hate just so they can get health insurance that ensures that someone else will pay their medical bills. Others pay for individual policies just to prevent having to pay those high medical fees themselves. On the other hand, many uninsured Americans would love to have enough money to afford medical insurance. They don't voluntarily go without insurance just so they can pass their medical bills on to the hospital or the government. They simply can't afford that insurance and as a result often wait far too long to seek medical care because they know they can't pay for it.
I keep wondering what it is about the phrase "can't afford" that Republicans don't understand. And it has always puzzled me that Republicans think there are so many people out there trying their best to avoid responsibility. What I see, instead, are a lot of very proud people, ashamed that they cannot afford to buy health insurance, and terrified that they or their children may become seriously ill and not be able to get the treatment they need.
THE MAGICAL FREE MARKET
Regardless of their opinion of the character of uninsured Americans, Republicans all agree that the solution to the health care crisis can be found in the free market. I'm not exactly sure how this is supposed to work, given the way insurance companies operate and given the party's determination to protect the exorbitant profits of pharmaceutical companies, so I looked on several websites of the presidential candidates to see if they could explain. They couldn't.
Giuliani said nothing on his website, but the American Academy of Family Physicians' web site said that the mayor wanted to make health care "affordable" and "portable" with "free market solutions." The Henry J. Kaiser Family Foundation notes Rudy's plan includes tax deductions and tax credits to help individuals buy insurance. John McCain also proposes tax credits and promotes "insurance competition," although I have no idea how that would work, given how the insurance industry determines the price of policies. He also wants to eliminate tax incentives for employers who provide health insurance for their employees, which sounds like a swell idea in that most Americans who are covered today get that coverage through employers. Mike Huckabee prefers tax deductions, tax credits and Health Savings Accounts. Mitt Romney also favors changes in the tax code, deregulation of health insurance markets, and somehow slowing the rate of inflation in health care spending.
The plans of all the candidates favor the three conservative magic bullets: more privatization, creation of tax deductions and credits, and deregulation. How these three would solve the massive looming crisis in health care, when they did such a smash-up job with energy and other industries, I can't imagine. Have we already forgotten Enron? And given that there really is no free market in health care, nor any real possibility of instituting one (as I will explain in the next essay) it seems absurd to keep touting the free market as the solution. Yet this is all Republicans have to offer.
To conservative Republicans, the "free market" must be preserved and allowed to work its "magic" in all aspects of the American economy. So they have two immediate goals: to convince the American people that the health care system is really pretty good, and to suggest that any small problems in the system can be solved with a little self-discipline on the part of Americans and some good old fashioned free market tweaking.
THE GREAT EQUALIZER: THE EMERGENCY ROOM
President Bush laid out both of those goals in a July 10th, 2007 speech in Cleveland when he said: The immediate goal is to make sure there are more people on private insurance plans. I mean, people have access to health care in America. After all, you just go to an emergency room.
Here Mr. Bush is insisting that private health insurance (provided in a free market) is the answer to the problems in the health care system. What he is also saying is that people who don't have health insurance still have access to care if only they go to an emergency room. We have already examined how using the emergency room as your primary source of health care is both dangerous and expensive, so obviously Mr. Bush is completely out of touch with reality.
TOO MUCH HEALTH CARE
Another common assertion of Republicans is that Americans have "too much health care," that they utilize too many services that they don't need and this is what raises health care costs. Here, Republicans are inferring that a little more self-discipline and a little less whining on the part of Americans will save money and thus reduce costs. While I have already mentioned that doctors sometimes order unnecessary tests and over-prescribe medicine, and that patients sometimes demand services that they could live without, this is not the main factor raising health care costs.
What drives up the cost of health care is a complex array of factors, including the number of uninsured, the high costs of technology and medication, the unhealthy American life style, and the enormous expense involved in caring for the very ill and the elderly, who live much longer today because of expensive medical technologies that save and improve the quality of their lives.
As noted before, 80% of all medical costs are incurred by 20% of patients. Are these the people whom Republicans refer to when they say "Americans have too much health care?" If so, I would like to know which one of them is willing to eliminate his grandmother's pacemaker, his uncle's dialysis, his spouse's chemotherapy, or his child's bone marrow transplant.
FREE MARKET PROPOSALS
To be fair, though, Mr. Bush does have a couple of "free market" ideas to improve the health care system. One is the creation of tax free health savings accounts. In the 2003 Medicare prescription drug bill, citizens were given the ability to create tax deductible health savings accounts. According to this law, people can put a certain amount of money away, which would be tax exempt, and which could be used later for medical bills.
There are only two problems with this law. The people who most need it, the poor and middle class uninsured, generally do not have enough money to put into such savings accounts, and certainly not enough to protect them from a catastrophic illness. The entire purpose of insurance isn't to pay for small medical expenses but to protect you in the event of a catastrophic illness, and health savings account cannot fulfill that purpose. Only the ultra rich can afford savings accounts that accomplish that. And the second problem is that the many disadvantaged citizens would not receive the tax benefit as they pay very little or no taxes. To paraphrase what Stephen Colbert so brilliantly observed, tax free health savings accounts allow people to set aside money they don't have to reduce taxes they don't owe.
The other Bush idea is eliminating the tax exclusion on employer's contributions towards health insurance and instead offering a tax deduction to individual taxpayers for the purchase of health insurance. The Center on Budget and Policy Priorities does an extensive analysis on this proposal and concludes that it would still not help low-income Americans afford health care, it would seriously erode the parts of the employer based system that are working today without providing a guaranteed replacement, and it would ultimately not solve the problem of increasingly high costs of medicine and health insurance.
It also appears to be a very complicated system that would confuse and frustrate many Americans and send them running to an attorney or accountant for help in understanding their options.
NOTHING SCARES THEM LIKE SUCCESS
Though they are ideologically opposed to universal health coverage, or any large government program, and disinclined to offer assistance to those in need, conservative Republicans must at least attempt to talk about health care reform as they know the Democrats are way ahead of them on this, and far more in tune with the wishes of the American people. And they are terrified the Democrats will succeed. They are adamantly opposed to Democratic proposals that might result in some variation of universal health insurance, all of which they mislable "socialized medicine." Republicans miss no opportunity to scare Americans into believing that any system of universal coverage will result in the government taking away all their choices in health care, even though the only plans that have so far been seriously proposed by Democrats would actually be public private partnerships, allowing Americans who have private health insurance, individually purchased or provided by their employers, to keep it.
In spite of Republican propaganda, some of the most popular, most successful and most efficient health care programs in America are the ones administered by the government. Both Medicaid and Medicare are popular, as is the S-CHIP program, the extension of which the president recently vetoed. The popularity of these programs is frightening to ideological conservatives who don't want to see government programs succeed and expand, and to their supporters in the pharmaceutical and insurance companies who fear being put out of business or losing some of their profits.
A little over a week ago, the Republicans showed just how frightened they are of any progress towards universal health care when they attacked a 12 year old boy whom the Democrats used as an example of how well the S-CHIP program works. Graeme Frost is a seventh grader who suffered brain injuries in a car accident and was able to access health care through the S-CHIP program. His father is a self-employed woodworker who makes about $50,000 a year to support his four children, and who could not afford the hundreds of dollars a month they would have to pay for health insurance. These are exactly the kind of families helped by S-CHIP, which is not intended for the poor who are covered by Medicaid, but instead for middle and lower middle class families who cannot afford health insurance for their children.
As soon as Graeme pleaded publicly for President Bush not to veto the new S-CHIP legislation, the Republicans went nuts in an attempt to discredit the Democrats, accusing Graeme's family of being too rich to qualify for the program. It seems Graeme goes to private school, which is expensive, and his parents live in a home valued at over $200,000. The Republicans neglected to do their research, however, as the facts are not on their side. Graeme's parents do not pay his high tuition. He has a scholarship. And they purchased their home in a depressed neighborhood for $55,000 in 1990.
Nevertheless, conservative bloggers piled on and excoriated the family. Rush Limbaugh, in a reprise of his Michael Fox performance, even tried to imitate Graeme's speech difficulties.
In typical Republican style, frightened conservatives attacked the messenger because the attacks they tried to make on the bill were so pitiful.
BOGUS CLAIMS
In explaining why he was vetoing the bill, George Bush said that with the expanded S-CHIP bill, Congress was trying to "federalize health care" by having the federal government make decisions for doctors and patients, and that the bill would cover children whose parents make up to $83,000. Neither of these assertions is true. The program enrolls children in private insurance plans and is run by the states, not the federal government, which in any case would not make decisions for doctors and patients. Additionally, while New York (where the cost of living is higher than in most other states) asked for a waiver to cover the children of families that make $83,000 a year, the request was denied. It should be pointed out that the goal of the bill was not to provide insurance for very poor kids, as they are covered by Medicaid, but to provide it to the 9 million currently uninsured children, whose families cannot afford to purchase health insurance, and who make too much money to qualify for Medicaid. So the target recipients of this legislation are above the poverty line.
The original S-CHIP legislation that covered 6 million children was passed during a Republican controlled Congress, so Republicans apparently are not totally against it. In fact, the current bill had strong bipartisan support. But this time around, with Democrats controlling Congress, and with the possibility of insuring another 4 million children, some Republicans balked. In the House as they debated the bill, these Republicans insisted "we need to focus on poor children first," a GOP talking point that apparently polled well.* This was also repeated by the president when he vetoed the bill, insisting the bi-partisan bill be changed to accommodate his preferred slight increase in funding (which because of cost of living increases wouldn't even cover the 6 million children currently enrolled.)
The Center on Budget and Policy Priorities reported that, in fact, it is the Democrats who are putting poor children first, and the president who is short-changing them. According to the Congressional Budget Office analysis, the "vetoed bipartisan legislation is specifically designed to put poor children ahead of everyone else," by providing fiscal incentives to states to cover those children who are currently eligible for S-CHIP and Medicaid but have not yet been enrolled. In fact, the biggest incentives are to enroll children in Medicaid. According to the New York Times "Republican Senator Orrin Hatch, a key sponsor, estimates that some 92 percent of the children who would benefit would come from families with incomes below twice the poverty level, the group the president says he wants to concentrate on."
In addition, the Center points to administration policies that actually "make it harder to reach poor children and likely cause more of them to be uninsured." Besides not requesting enough funding to cover children currently eligible for S-CHIP, the administration is also proposing new regulations that would prohibit schools from helping poor children enroll in Medicaid. Currently, this is one of the few ways the parents of very poor children gain access to Medicaid.
The reality is that the opposition to the bill is both groundless and dishonest. Even the claim that the $35 million price tag is too high seems ridiculous when Republicans are willing to spend hundreds of millions in Iraq and when this $35 million would come from a new tax on cigarettes. The only conclusion anyone can draw is that the opposition is both political and ideological. In terms of politics, the Republicans want to deny the Democrats an election year victory and accuse them of being unable to govern. They also want to keep those campaign contributions coming in from the pharmaceutical and insurance industries who don't like the bill. In terms of ideology, Republicans simply can't stomach moving closer to universal coverage for all Americans. It hurts their anti-government sensibilities.
SUMMARY
In light of the complex set of factors involved in the health care crisis, conservative proposals to actually fix the broken system seem extremely weak. Giving tax deductions and/or credits to compensate individuals who purchase health insurance, creating health savings accounts, ending the incentive for employer provided health insurance, chastising Americans for using too much health care or for being moochers, and proposing other non-specific free market ideas like increasing competition and deregulating the insurance industry won't get everyone access to health care nor stop the skyrocketing cost of medicine.
If Republican proposals don't solve the problem, however, never fear. As the Great Decider says, you can "just go to the emergency room."
*You would think Republicans would have better memories. The last time they pulled the "let's help the poor first" strategy, it backfired. When Lyndon Johnson was working to pass the Medicare bill in the Congress, Republicans balked and insisted the president should first focus on the poor, whereupon Johnson proposed a second program: Medicaid.
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To read the previous two installments in this series, click on archives and then click on the individual essays. In the next essay, I'll explain in detail just why the free market will not provide the solution to America's health care problems.
-Ellen Terich
All content © 2005 outragedcitizen.com
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