An Economic Argument Against Government-Run Healthcare

While rare situations do occur where one is refused medical coverage because they do not have health insurance, it is certainly the exception. In our current system, we do not have a pandemic problem of refusing care to those who don’t have insurance.  It’s due to the same principle that if you see an injured person on the street, you feel an unwritten moral responsibility to help that person. If you don’t, while you may not be criminally charged, you could be sued under civil law under a negligence tort for example. I would argue that one reason that a hospital would refuse care would be due to the excess demand for care in emergency rooms. Doctors can’t treat everyone and some are bound to end up wanting. This problem will only worsen with a government run system.

 I have heard the argument many times that current policy holder’s end up paying for the uninsured in the form of increased insurance premiums. While it is correct that insurance companies pool risk, just remember, it is usually the most risky that are insured in the first place. It is simple “adverse selection.” Adverse selection means that the individual’s demand for insurance is positively correlated with the individual’s risk of loss or injury. So a risk tolerant person is more likely than a risk averse person to have a health insurance policy. I will also argue that moral hazard plays an important role in this. Once we insure the masses, their behavior will likely change and become more tolerant to risk, thereby causing an increase in demand for medical attention. How can we possibly treat so many new people with the no increase in the amount of doctors providing that care? In fact, who on earth would want to become a doctor when the costs incurred during med school alone will clearly outweigh the benefits of being a doctor. We all know that payments to doctors will be as little as possible if the government takes over the system (we see this already with Medicare) and it will be virtually impossible for a doctor to make a profit, much less a living. So the inevitable result will be that the supply of healthcare providers will decrease while the demand for healthcare will significantly increase. We will have to deal with a severe shortage of health treatment. This is when the government begins to explore the rationing of care.

Do you really think that costs will decrease if there is a government health system? You may have a comparable monthly premium, but if you account for the massive tax increases that must accompany this policy, you will see that your costs will increase significantly! Consider this argument too…premiums are so high because there are a multitude of regulations requiring insurers to cover a multitude of unnecessary illnesses and injuries. A 20 or 30 year old, for example, should not have to buy a health care policy that covers Alzheimer’s or elderly care, or a woman should not have to purchase maternity care if she cannot medically bear children. If the government would just rescind these ridiculous regulations, there would be a strong market for a wide range of insurance policies that would be offered at various rates depending on the coverage promised. What a simple solution that would be…and cheap!

 Our current system is certainly not perfect, but it is not broken. It is still one of the best in the world. I would argue if President Obama is so concerned that the uninsured person may have some sort of a catastrophic injury and not be able to foot the bill, why doesn’t he just set up a fund to give grants to those who really DO have such an event in their life. That way, government can help only those who really need it without forcing others who don’t need it and don’t want it to pay for a forced insurance policy. While that solution is not optimal either, it is certianly better than a complete overhaul and government takeover of the health system.

 Let’s consider auto insurance for a moment. It is important to note that we are only required to carry liability insurance. The reason is simple. It is because our vehicles can cause irreparable harm or death to another person who had no choice in the matter. You must also take note that we are NOT required to retain comprehensive and collision coverage (unless we have a lien on our car, for which that reason is obvious). We must only maintain liability coverage due to the incredibly high risk of our vehicle (which if it has a lien, is owned by someone else) damaging the property of, seriously injuring, or killing a third party. It’s all about the high probability of very dangerous negative externalities. With health coverage, we would not cause irreparable harm to another by injuring ourselves and going to the doctor. We are only directly harming ourselves. In fact, I’ve gone to the doctor without insurance and I guarantee, no one else paid for it, they sent me the bill…and quickly I might add.

 My final argument is that while the uninsured may make the premiums of the insured go up to some extent, another lower cost way to fix that problem would be for the government to just compensate doctors for treating those uninsured people? That would create an incentive for doctors to treat those who can’t pay and remove the problem all together.

It seems to me that the ones who are always so “willing” to pay more taxes to help the “poor” are usually the ones who are squawking about higher insurance rates and want a government take over of the system? Just take your higher insurance rates as your gift to the uninsured poor person. Wouldn’t you say?

Want To Improve Your Health? Watch What Meat You Eat!!

Please take a moment to watch the video at the bottom of this post!!!  Your health and the health of your family is at stake!

How is it that an individual can go to jail for animal cruelty for killing or injuring an animal, when our very government supports animal cruelty via our meat industry?  Now let me preface this post by stating that I love a good hamburger or steak!  I am not anti-meat, but I am against eating meat that has been pumped full of hormones and antibiotics.  When a cow is injected with these hormones, such as rBGH, it develops significant health problems.  The cow will develop many infections and sicknesses; lameness and udder infections to name a few.   Consider for a moment the udder infections.  The milk from these sick, infected cows end up in your refrigerator, which you drink and give to your children to drink.  No one knowingly eats rotten or spoiled meat and milk, but most people are doing just that by purchasing meat and milk that has been tainted.  That reality should put fear into the heart of every rational, sane person. 

I am repulsed not only by the horrid conditions and the inhumane treatment that these animals endure prior to slaughter, but also the incessant injection of growth hormones in order to force these dairy cows to increase milk production.  If you have never watched one of those videos that actually show you first hand how these animals are treated from birth to slaughter, keep your seat belts on because I have included a link at the bottom of this post so you can see for yourself.  These animals are tortured, mutilated, and diseased, with their flesh practically rotting off their bones while they are still alive.  I started to watch this video and could not finish it.  It ruined my whole night and made me so upset that I can no longer eat meat products unless I am confident that what I am eating is free of supplemental growth hormones and antibiotics, and that the animals were treated in a humane way.  Sound extreme?  Consider the fact that the FDA is approving this process by allowing you and your loved ones to consume diseased, mutilated, and rotting beef, pork, chicken, and puss-filled milk by allowing it to line the shelves of the supermarket.  The FDA is fully aware of the health risks that these hormones and diseased-ridden animals impose.  If fact, almost every western country has already banned rBGH due to the health risks, but the US refuses to ban it.  Why?  Could it be that Monsanto (inventor of rBGH) is a large financial contributor to the government?  Just a little conspiracy theory for ya.   The health of Americans is deteriorating.  Instead of waiting for the government to throw more money at the problem (which never works) take your health into your own hands.  If people knew what the FDA was allowing to get to the grocery stores, there would be a national outrage and boycott of epic proportions.  It’s not a mystery why the health problems in our society are so severe and cancer is running so rampant.  People just need to be willing to look under the covers to see what’s really going on.

We must learn to be aware of what we are eating.  We obviously cannot depend on the FDA to make sure the food we are consuming is healthy and sanitary.  If we want the meat, milk, eggs, and every other animal product on the shelves of our grocery stores to be truly healthy and fit for human consumption, then we must begin taking a stand against these practices by refusing to purchase their poison-ridden products.   Look for meat products that say “No Hormones or Antibiotics,” “rBGH Free,” “Grass Fed” and “Free Roaming.”

If you are in any way concerned about your health, please watch this video.  It is very difficult to watch, but it is necessary if you are to know what you are really dealing with.  Knowledge is power!

http://www.chooseveg.com/meet-your-meat.asp

Do You Want Lower Healthcare Costs?

The best way to lower health care costs in this country is to tell the government to get their hands out of it and allow the free market to work.  One of the reasons that it is already so expensive in the first place is because the multitude of government mandates that have been forced upon the insurance companies.  One cannot say, I want coverage for this, but not for that, it is government forced bundling.  This is a bit frustrating because there are all kinds of rules and regulations against private companies regarding the bundling of products.  Everyone remembers Microsoft.  One of the issues with Microsoft was that they were bundling their Windows software with the sale of computers.  There are numerous federal laws against this, but these federal laws do not seem to apply to the government itself.  Regarding health insurance, it is a service.  It is a service offered by a privately owned business.  What right does the federal government have to tell a private business what they can and cannot do or what they can and cannot sell? 

There are so many regulations requiring insurance companies to cover this and cover that, and it’s no mystery to me why health insurance premiums are so high!!  Many states require insurance companies to cover birth control pills, abortion, smoking cessation programs, gastric by-pass surgery, breast reconstruction, and in some states, acupuncture!!??  What if I do not want acupuncture, gastric by-pass, breast reconstruction, or any of these other things??  What if I just want coverage for serious illnesses only and maybe a yearly checkup?  All of the mandates so lovingly forced upon us by our federal and local governments forces us to purchase coverage that we do not necessarily want or need!  It’s no wonder that premiums are out of the ball park!  If the government mandates were removed, the insurance companies would reorganize their insurance packages in order to get the maximum amount of producer surplus.  This means that they would offer different packages that would cater to different types of people with different needs at different costs.  This means that I could purchase a health care policy that only covered minimal illnesses or emergencies at a very reasonable cost if I wanted to.  And as one who does not currently have health insurance, I would certainly be interested in an insurance policy that allowed me to choose what kind of coverage I wanted.  I would probably begin paying for insurance tomorrow!! 

An extensive health-care policy is not for everyone.  Some people are more risk averse than others.  There are those who are willing to bear the additional risk in order to use their limited resources towards something else.  If a rational person is willing to take that risk, then they also understand that must bear the financial burden if things do not go their way.  This issue is not that they wouldn’t be treated, the issue is paying for the treatment.  Who is anyone to say that they can’t make that decision.   Forcing insurance providers to cover every condition under the sun is the very thing that is causing the number of uninsured to increase.  This is done in the name of “helping the poor.”  Poor people cannot afford to hedge the risk for every condition!  Trust me, the insurance companies would love to have the business of the less fortunate by offering them more conservative policies.  It is government bureaucracy, both Democrats and Republicans alike, that will not let this happen.  In fact, they want to add more bureaucracy!  Either they are stupid or they just don’t care.

How can this happen, you ask?  As much as our elected officials promise to be working in our best interest, their actions scream that they are not.  They think that American citizens are stupid and are unable to navigate this tough financial world without their help.  Isn’t it funny that it’s the Democrats that profess themselves to be the anti-big business, for the little guy, party; yet it’s those very Democrats that insist on bailing out those big businesses with the hard earned money of the American tax payer. 

Remember, it’s the free market that is always on the side of consumers.  Consumer demand is a main component of price determination in the market.  If you think health insurance costs are too high, it’s not due to consumer demand, or lack thereof, for we all agree demand is higher than ever, it’s due to the constraining mandates of our very own government!  Please just let free-market competition work!!!  Want lower health insurance costs?  In free market competition, the greater the demand, the lower the prices.

Mandatory Health Care!!!?? Are You Nuts!!??

Elizabeth Edwards is getting on my last nerve!  I know she is passionate about this subject and I feel for her due to her cancer diagnosis, but she is just not seeing the big picture.  She is acting on emotion, which is never a good idea.  Emotions will deceive you.  The reality is, government cannot possible make people better off.  There is no possible Pareto improvement in this situation.  I heard her say in an interview in early October with NPR that we need to approach health care in the same manner we approach auto insurance, requiring everyone to maintain coverage.  She claims this will spread out the costs making it cheaper overall.  This is just another liberal pulling on the strings of those who have less in an attempt to appeal to their needs, and people are so gullible!

Regarding mandatory auto insurance, it is very important to note that it is not required that a citizen maintains coverage for their own welfare, but only for the welfare of others.  Only liability coverage is required!  This is the case simply because an accident will most likely involve someone else and most likely injure that other person.  If a person is injured in an accident, at the fault of someone else, what recourse does the injured have if the one who caused the crash has no money? 
 
Also, it is my right not to purchase health care.  What people like Mrs. Edwards do not seem to understand is that most of the people without coverage make the choice not to have health care.  My husband and I fall into this category.  We have not had health insurance since 2002.  If we really wanted insurance, there are plenty of monthly expenses that could be cut; cell phone bill(s), internet service, car payment (buy an old car, God forbid), shopping an Whole Foods (which is a bit more costly than Food Lion)…  Do you get the point?  The fact is people are valuing these other consumables more than their health coverage.  It is not anyone else’s problem if I or any other decides against health coverage.  I don’t expect anyone else to pay for my healthcare when if I cut corners, I could pay for it myself.  This is the case for MOST people.  For those others that truly have a need, our system already is set up to help them.

Another reason I am against mandatory health care is that it will increase risk-taking behavior, better known as moral hazard.  Mrs. Edwards and many other liberals insist that the costs will go down, but, in fact, the costs will go up because people will begin to act in a more risky manner, thereby causing them to make additional trips to the doctor or emergency room.  Those currently without insurance are cautious about what they get involved in; cautious about how they drive, and do not take unnecessary risks.  It is human nature that when one does not have to bear the full consequences of their actions (via paying the doctor bills) they will not be as cautious and the risk that they will injure themselves increases significantly.  All of the additional patients that doctors will have to treat for a minimum costs will diminish incentives for the next generation to invest in becoming a doctor.  The increase in demand for doctor services combined with a decrease in supply of new doctors is a standard economic recipe for very high medical costs.  The next step will be for the government to put a price ceiling on medical costs leading to a major shortage of treatment availability.  And we think our healthcare system is bad now.