Wednesday, March 28, 2012

Someone understands health care

And it's not George Will.  A Minnesota reader responds to Mr. Will's recent op-ed:

Dear Globe Editor:
George Will declares (Globe, 3/27/2012) that the Obamacare individual mandate problem is simple: compelling people to “buy” insurance violates traditional contract law. If that principle is upheld, he says, then there would be no “stopping point” to Congress’ powers. OK, fair enough. But like his political allies, Will fails to point out an obvious inconsistency. The healthcare system is financially broken because Congress in 1986 forced it by extortion to provide services (through ER’s) to anyone who could not pay for them, the threat being that if it didn’t, Medicare and Medicaid fees would be denied. That law, “EMTALA“, is the reason 41 million people feel that health insurance is not a necessity.
EMTALA is just as much a violation of common law as the individual mandate, and probably more so, and yet no one (of either party) is calling for its repeal. Why is that? I submit that it is because the pols all understand that the electorate is self-indulgent. We love that America has “the best healthcare system in the world”, but we would rather not think about it costing 2 ½ times as much as it should.

The ACA is an improvement, but it is still unaffordable because of EMTALA. The only way out of the financial mess I can see is to make healthcare a tax-supported program like Medicare, the so-called “public option”, but it seems that will have to wait until the present system collapses, something it is now doing in slow motion.


tmercer said...

"Someone understands health care"

Isn't the PPACA more about health insurance? This raises the question: What is insurance?

One generally accepted definition: Insurance is an investment contract. You pay today in return for a promise to be paid later, contingent on the occurrence of events whose cost risk you seek to mitigate. The role of insurance companies, then, are designing contracts (coverage), assessing risk, setting rates, and deterring inefficient behavior.

Constitutional or not, PPACA transforms the health insurance industry into something else. It becomes an administrator of a system of national health care masquerading as insurance, with the government collecting a rake off of their revenue streams.

Central to PPACA funding (and health insurance industry co-option) is the individual mandate, an improperly disguised tax which singles out the young, healthy or otherwise uninclined to buy insurance so the money can be used to subsidize someone else. The scheme mimics Medicare and Social Security in this regard, both of which are scheduled to pay out trillions more in benefits than they receive in funding (based on government agency estimates). Demographically it is a certainty that planned Congressional funding under PPACA will prove inadequate in the face of incentives designed into the legislation (such as employers opting for a $2,000 per employe fine for dropping insurance benefits versus paying $10,000 to $12,000 per employee for continuing the benefits, and over-consumption of medical services by individuals determined to get their money's worth for insurance they were mandated to purchase trough state exchanges). This will force insurers to endlessly lobby for appropriations to subsidize and sustain an unsustainable system.

The problem is not that PPACA can't work without the mandate. The problem is that it can't work without the Chinese or someone else lending us trillions of dollars indefinitely so the federal government can keep spending money it doesn't have.

tmercer said...

As to the Constitutional question:

In the US, the legitimacy and authority of the Federal government (or rather, its institutions) is derived from the Constitution, not from elections, or any other expression of current popular will. That authority is not the authority to pass any law that doesn't intrude on specific rights (plenary powers), but is instead the authority to take specific actions as listed in the Constitution (enumerated powers). The primary question before the Court is whether or not the power to compel everyone to purchase health insurance falls under those enumerated powers.

Universal health coverage may be the norm in developed countries, but that's utterly meaningless when asking if the power to achieve it in the manner set out by PPACA has been granted to Congress.

Using car insurance as an example, that is mandated (as a condition of using public roads) by the States, which have plenary powers, and not by the Federal government, which has enumerated powers.

So...the 50 states have wide "police powers" over their citizens. States can literally order their citizens to go outside and manually build a road. (Also literally adjudicated in the US Supreme Court, BUTLER V PERRY, 1916.) Or they can order citizens to buy health insurance, or buy auto insurance, or scrub toilets.

Unlike the 50 states, and unlike central governments in Europe, the US Federal Government lacks police powers over its citizens, except to (1) draft into the military, (2) participate in censuses, but not elections, (3) serve on juries / as witnesses, (4) pay taxes. End of story.

The individual mandate is trying to wildly expand federal police powers over citizens, even outside of tax incentives.

Tony said...

Tmecer, Actually I agree 99% with what you say. The question remains then what statute EMTALA falls under regarding Constitutional laws? Is any other profession required to work for free?

Read more about EMTALA, signed by Reagan, and tell me what you think. For all practical purposes it makes health care a de facto right; for me to practice medicine I am required to haul my ass out of bed at any time and care for someone who has no ability or willingness to pay me, exposing me to financial and liability risk. What other profession does this?

I hear no voices calling for anyone to take the responsibility to insure themselves, the costs are thus shifted and your premiums rise. EMTALA worked when we had 5 million uninsured in 1986, but the system breaks down rapidly with 40 or 50 million uninsured, and that number climbs by a million a year.

Furthermore, employer-based health insurance gives a double whammy with even more uninsured in a recession because they lose their jobs... and health finances get squeezed more just at the wrong time.

The GOP did NOTHING when they had control of Congress and the presidency AND a budget surplus. Obamacare is a first attempt at polishing a turd, and it will need multiple revisions along the way. FWIW, I think it will fail and we will end up in a national universal health care Medicare-for-all system at some point, but that's another story.