Reduce Government to Improve Health Care
Much like the drunk who wakes up with a hangover and thinks more
alcohol will cure him of his ills, many of those who decry our nation’s
health care problems think we need more government involvement.
Government is already by far the biggest player in our nation’s health
care, though, and many of the problems with the system can be traced to
it. In order to cure our health care hangover, our nation does not need
more government – it needs a healthy diet of consumer control.
Listening
to many people discussing various plans to reform health care, you
might get the impression that our nation’s health care ills are due to
too much profit motive or too little regulation of our “free
enterprise” health care system. What the people who hold these views
fail to appreciate is how very far our health care system is from being
remotely “free enterprise.”
A common line of criticism is that
for-profit insurance companies put profit ahead of people and deny
necessary health care. Many insurance companies are non-profit,
however. Furthermore, government – combining state, local, and federal
– pays for almost half of all health care in this country, far more
than insurance.
Yes, private sources, whether insurance or
individuals paying bills out-of-pocket, pay for the other half. But
that supposedly “free market” portion of our health care is heavily
regulated by both the federal government and individual state
governments.
How does all this government involvement
contribute to many of the health care problems we are facing in the
U.S.? Take overall spending on health care. This spending was less than
5% of our gross domestic product (GDP) in 1960. It is now around 15%.
It is not insurance company profits that caused this spending to
increase so dramatically. While there are many reasons for it, there is
research that suggests that the creation of Medicare has played a large
role in medical cost inflation over the past forty years.
The
government’s interference in the market also causes insurance to be
more expensive than is necessary. There is no interstate competition
for insurance policies purchased by individuals and small businesses.
Additionally, every state imposes a variety of expensive mandates on
what these policies must cover. Some states also set rules that prevent
insurance companies from pricing policies to reflect their risk. All
those laws drive up the cost of insurance, helping to contribute to the
number of uninsured.
With these and many other rules and
regulations, the government is the biggest influence on how our health
care is delivered in this nation. With so many obvious problems with
our system, it makes little sense to turn over even more control of it
to the government. Whether through a completely government-run system
as proposed by single-payer advocates or through more controls and
regulations as proposed by many politicians, these plans will only
worsen the problems we do have.
Instead of more government, our
elected officials should be looking for ways to free health care
consumers. As we saw when government began to relax its controls on the
communications sector and airlines, less government interference in
health care will likely lead to lower prices and better service.
Allowing
consumers more freedom to purchase health insurance, removing
restrictions on health care competition, and reducing the burden of
government programs will go a long way towards helping American health
care. Problems will still remain, certainly, but it makes sense to
first address those which are the unintended consequences of bad public
policy.
Too much government involvement in health care has
produced the system we have today. We should not compound our problems
by introducing even more harmful rules and regulations. Consumer
freedom – not government fiat – is the way to help health care in
America better serve those who need it.
Marc Kilmer is a policy analyst with the Buckeye Institute for Public Policy Solutions, a research and educational institute located in Columbus, Ohio.
