Tuesday, September 29, 2009

Obamacare is Dead - Long Live Romneycare?

The dirty little secret of the Democrats' latest plan for advancing socialized medicine this year (under the guise of "reform") is that it has morphed into a copy of a Republican scheme. McClatchy-Tribune's Chen May Yee writes::

"Massachusetts is the only state that has adopted the core elements of the plan outlined by President Barack Obama and congressional Democrats: an individual mandate; an employer mandate; subsidies for the poor; insurance market reforms; and an 'exchange,' under which consumers can shop for coverage."

Although she doesn't mention it, the Dems' current scheme is the Baucus bill. And the Massachusetts plan (enacted in 2006) is the state universal healthcare bill enacted by then-Republican governor Mitt Romney.

The plan recently released by Senate Finance Chairman Max Baucus is, according to the Wall Street Journal, Public Option Lite. Just like in Massachusetts, the government will set the terms across the board:

“The headline is that Mr. Baucus has dropped the unpopular "public option," but this is a political offering without much policy difference. His plan remains a public option by other means, imposing vast new national insurance regulation, huge new subsidies to pay for the higher insurance costs this regulation will require and all financed by new taxes and penalties on businesses, individuals and health-care providers.

“The centerpiece of the Obama-Baucus plan is a decree that everyone purchase heavily regulated insurance policies or else pay a penalty. This government mandate would require huge subsidies as well as brute force to get anywhere near the goal of universal coverage. The inevitable result would be a vast increase in the government's share of U.S. health spending, forcing doctors, hospitals, insurance companies and other health providers to serve politics as well as or even over and above patients.

“The plan essentially rewrites all insurance contracts, including those offered by businesses to their workers. Benefits and premiums must be tailored to federal specifications.

“Everyone would be forced to buy these government-approved policies, whether or not they suit their needs or budget. Families would face tax penalties as high as $3,800 a year for not complying, singles $950. As one resident of Massachusetts where Mitt Romney imposed an individual mandate in 2006 put it in a Journal story yesterday, this is like taxing the homeless for not buying a mansion."

(Before I go any further, I want to say that at the time of enactment, I expressed reserved support for Romneycare. I have long since changed my mind, for various reasons, but based in large part upon the realization that Romney’s plan for “free market healthcare solutions” was no such thing.)

What we have here is another lesson in the destructive ramifications of a Republican attempt to play Democrat Lite; or, to put it another way, to act without principles. Romney teamed up with Senator Ted Kennedy to craft his “bipartisan” scheme. The result has been 432,000 newly insured individuals, most of them subsidized (including “healthy”, “carefree 20-something” Rebeccah Pearson, who received a policy for $34.60 per month, courtesy of the taxpayers). Ms. Yee writes that:

“Success in expanding coverage has brought its own problems: rising costs and longer waiting times… State costs shot up too. State spending on health care grew $707 million [including $354 million in Federal money].

"It took on average 63 days to see a family doctor [in Boston] for a routine physical exam, compared with 10 days in Minneapolis and seven in Miami, according to Merritt Hawkins, a Texas physician recruitment firm. It said that wait times had lengthened in Boston, while falling in other markets.

“Next, officials want to tackle costs. They want to stop paying doctors for each procedure, which can spur overuse, and pay for outcomes — that is, for keeping patients well. [rationing, in other words]

“As a result, providers are trying different strategies. Mount Auburn Hospital in Cambridge sends nurses to visit recently discharged patients in their homes, a bid to prevent the next hospitalization. [again, rationing]

“Atrius Health, a large multi-specialty group, is trying out group visits: one doctor sees several patients at once.

“Atrius Chief Executive Dr. Gene Lindsey, a cardiologist, now meets with 10 patients at a time. It takes him an hour and a half, compared with three hours to see each individually.”

Some “success”. Rather than liberate the insurance market from the third-party-payer system, government mandates, and interstate barriers to competition to allow a competitive market to drive down prices and widen affordability, we will instead have to endure higher taxes to cover budget deficits, two month (or longer) waits for routine doctor’s visits, rationing, group (rather than private) consultations for our most personal health problems, etc. – so that the irresponsible “carefree 20-something” Rebeccah Pearsons can get $34.60 a month healthcare – subsidized by us while we wait, of course.

These predictable outcomes are written off as mere growing pains (“lots of kinks and issues", as it is described by Phillip Gonzalez, director of grant-making at the Blue Cross and Blue Shield of Massachusetts Foundation). But FIRM’s Dr. Paul Hsieh sees more than kinks. In The Objective Standard, Dr. Hsieh documents at length why the problems with Romneycare were inevitable and destined to grow worse. His article, Mandatory Health Insurance: Wrong for Massachusetts, Wrong for America, concludes with:

“The Massachusetts plan failed because it suffered from all the moral and practical flaws inherent in any system of socialized medicine.47 Mandatory insurance was not right for Massachusetts—and it is not right for America. It is a rights-violating road to disaster.”

Where is all of this leading? Again, from the Yee piece:

“What critics don’t understand, [Lindsey] said, is that reform doesn’t end with universal coverage. It’s like building a house.

‘We’ve just put a basement in, and now we’re walking around and we see there’s a problem with where we wanted to put a bathroom. So we’re having to change direction.’

“The work of health reform, he said, has just begun.”

Just begun! In classic fashion, a government plan is enacted to correct problems caused by prior government interference, leading to more problems and more government controls. Where will the work of health reform end? In total government control of medicine. And, as all to often happens, the incremental creep toward socialized medicine is led and/or sanctioned by the Republican Party. We are on the verge of Obamacare because of one of the 2012 Republican presidential frontrunners, Mitt Romney. To be fair, many republicans and conservatives never liked Romney’s plan. But where would the Obama Democrats be following the summer of the Tea Party/ townhall rebellion against their original “public option”-led healthcare “reform” scheme, without the Romney model? Obama can rightly trumpet the Baucus “compromise” as a bipartisan bill!

The tragedy is that the Massachusetts plan, having been enacted under a Republican administration, operates under the free market capitalist banner. So when national Romneycare fails, if and when it is enacted, the cry will rise that the free market has had it last chance and has failed. After all, didn’t many Republicans and conservatives hail the Massachusetts plan as a “marked-based” solution? We will then be ready for the single payer dream of the American Left.

No other end result is possible, unless we move in a totally different direction. Urges Paul Hsieh:

“The solution to disproportionately high health care costs and poor access is for Americans to recognize that health insurance and health care are commodities that can be produced only by means of the long-range thinking, planning, and risk-taking of businessmen acting in a free market, and that individuals and insurers have the moral right to contract with each other as they see fit. Mandatory insurance fails because it ignores these facts and violates these rights.

“If we Americans value our health and our lives, then we must reject mandatory health insurance. We must demand that the government stop violating individual rights and start protecting them. We must demand a genuine free market in health insurance and health care, because only a free market can provide us with the quality, affordable health care that we all need.”

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