Steamboat Springs I was heartened to read John Salazar's commentary concerning health care in last week's Pilot & Today. If Mr. Salazar means what he says about the problems, we can solve them well short of the essential nationalization of the industry under the current House bill.
First, let's dispense with the rhetoric that "the system is broken." By all objective measures, the American health care system, in terms of treatment, is the envy of the world. The problem is that we have not figured out how to pay for it.
The economic truth is, if you are going to own a Mercedes, it is going to be expensive.
The proposed legislation will address this issue in two ways: 1) ration care, and 2) make someone else pay for it.
To illustrate rationing, there are four times as many MRI units in the U.S. per capita as there are in the government-run systems of Canada or Great Britain. And in Great Britain, you will not receive treatment for macular degeneration until you have gone blind in one eye.
On the payment front, the House bill would impose an additional payroll tax (over and above the existing 15 percent payroll tax) of 8 percent on employers who do not provide health insurance coverage - not exactly a prescription to bring down the current high rate of unemployment. Over and above this, there will be a payroll tax of 2.5 percent on individuals that do not have health insurance.
This is not the kind of hope or change that I am interested in.
But Mr. Salazar's main complaints concern pre-existing condition exclusions and the prospect of losing insurance when leaving a job. This, we can fix.
The insurance industry has been regulated for many decades at the state level, so regulation is not new. However, like many regulatory agencies, these have fallen too much under the influence of the regulated industry. Here is where we can help right the ship.
The essential elements are:
- Uniform pricing for products: IBM, my law firm and individuals pay the same price for the same product from the same company, and the same products are available to all. Insurers compete on price.
- Greater transparency: Be sure people understand what it is they are buying.
- Modify pre-existing condition exclusions: These can't really be eliminated or too many will not buy insurance until they are sick, but allow someone to buy coverage that is the same as what they have had during the prior six months.
- Uniform financial reporting for insurance companies, like the SEC requires for mutual funds: If there is some untoward conduct, we will see it.
- Eliminate government-mandated coverage: Let the consumer pick what they want. You surely have seen the Progressive commercial saying "name your price for car insurance, and we will design a policy to fit." Why not health insurance?
- Encourage Health Savings Accounts: Let the free market work.
- Tort Reform: Control costs.
Finally, let's tell the truth about the number of uninsured. Of the 45 million Salazar cites, few are chronically uninsured - the majority are just between jobs, 5 million to 12 million are illegal immigrants, 3.6 million to 9 million are on Medicaid, 3.5 million to 4.5 million already are eligible for government health programs but not enrolled, and 20.4 million have, or live, in families with incomes greater than twice the federal poverty level.
So, Mr. Salazar, we can address the issues you cite without the extreme and ill-advised legislation that you appear to support. If you are serious about your concerns, I will be the first in line to help fix the problem.
Call me. I am easy to find, and I will be sure to let the Pilot's readers know if I hear from you, and, I hope, report our progress.
Rick Akin is an attorney practicing in Steamboat Springs and Austin, Texas, and a director of The Steamboat Institute. He holds a doctorate from the University of Texas.