Michael Swickard

“If you think health care is expensive now, wait until you see what it costs when it’s free.” – P.J. O’Rourke

I like the free market. When one merchant sets a price, others have to match or undercut it to get my business. Prices rise and fall depending on supply and demand.

Without either a monopoly or government interference, this price awareness by sellers and buyers keeps our economy vital.

Over the years, some consumer goods and services have increased in value and dropped in price because of the free market. However, some goods and services without market pressure have only increased in price.

Example: in the medical fields of elective plastic surgery and Lasik eye correction, the price has dropped while the value increased.

These procedures typically are not covered by insurance, so consumers must decide to purchase or not. Purveyors of these services must induce buyers by price and more value. Since consumers are free to use whichever plastic surgeon has the best deal, the market effect results in a better deal for consumers.

Ultimately, this competition results in both lower prices and increased quality.

Contrast with government-controlled health care

Contrast government-controlled health care. Our nation’s biggest health insurer is the government with Medicare, Medicaid and the health needs of our military. Since there is only one provider, there is no competition. Everyone must use the government care exactly as the government dictates, or they get no care at all.

What is the incentive for the price to drop and the value to rise when the government controls it? The government cares about control, not cost.

Likewise, the medical professionals must take the government compensation or not compete for those clients. Currently, many health professional do not deal with the government by choice. Many say they will leave health care rather than work against their will in a government system.

The disease is that many citizens think they can get more than they give. In health care, consumers have spent so much energy trying to spend less on co-pays that they do not see that this very action is what has caused the increased cost of health care due to the vast bureaucracy processing all of that paperwork.

Insurance is supposed to inure us against that which we cannot stand to lose. Instead, we are brought into a discussion about incidentals like co-pays that are either $20 or $25.

What insurance is supposed to do is spread the risk of a huge individual loss widely so that it is never catastrophic for that individual. Instead, health care has turned into a completely different discussion, with an eye on controlling people rather than helping people.

We are discussing entitlement

Example: one of the mainstays of the health-care reform is that companies are not to change the health-care cost when claims are higher. Wait – insurance is shared risk, and the way we compute the risk is how we price the insurance cost. So if I am on insulin costing $1,000 a month and the government mandates that an insurer allow me to buy “normal” insurance without computing my already established cost of insulin, then someone else will be paying for my insulin.

This kind of reform means we are not discussing insurance; rather, we are discussing entitlement. What started as something to protect each of us against catastrophic loss has turned into a question of how I can get my neighbor to pay my health-care costs.

But I do not know why we are talking about health care while most members of Congress have not even read the thousands of pages of the reform bill they are set to vote into law. And if the new law is enacted, bureaucrats will then interpret what was written but not read by our elected representatives.

No one has even the slightest idea what really will happen, but there is a perception that we should just trust Congress and not read the legislation since the members of Congress did not read it either. Call me a skeptic, but when my congressman has not read the bill and still says he is in favor of it, I am filled with trepidation over the fate of our country.

Getting more while giving less

This is about trying to get more while giving less. It reminds me of carnival barkers who draw the crowds with loud promises of great prizes but just take the money of suckers.

At the most fundamental level, we have people who think government can give more than it takes. We hear politicians say, “Vote for me and I will get you more from government than you have to give.” Sounds good, but it does not work in real life.

This brings us to the vote in Congress. We have a representative form of government in which we vote people into office to do our business. We can send them messages but only they can actually vote. It seems quite likely that instead of fixing what government has done to health care already, many politicians are set to vote to make it worse.

That is not what we elected them to do, and our recourse is to vote them out of office.

The question: Will we fall for this same old gaff that we will get more than we give with this reform legislation, or do we have any sense at all? Voting to change our health care to be more like Medicare will come back to haunt politicians in November. I guarantee it.

Swickard is a weekly columnist for this site. You can reach him at michael@swickard.com.

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