Folks, I have bad news for you. The Barack Obama Health Care Reform (shepherded through by Nancy Pelosi) will be, as written, an utter and unmitigated disaster. It attempts to do two things which are, in combination, impossible. First, it makes health insurance much more widely available through the mind-boggling deal it made with the insurance companies. To wit: the health insurance companies agree to insure everyone, and the federal government forces everyone to buy health insurance. While that's a huge give-away to health insurance companies of your personal tax dollars, that's not impossible.
No, the impossibility comes when you combine that with: Second, Barack is going to pay for this new plan by reducing costs. There's two problems with this idea. A) if costs could be reduced, insurance companies would have already done it, and pocketed the money. B) when you pay less for something, you get less of it. This is one of the iron laws of economics, which is just as inviolable as the laws of thermodynamics, or the laws of mutual attraction (things fall at 32ft/sec/sec absent wind resistance).
So Obamacare will attempt to 1) increase the amount of medical care needed because you have all these newly insured people, AND 2) decrease the amount of medical care available by paying less for it.
No, really.
Stop laughing.
This is our PRESIDENT, and he deserves the same respect due to any other politician who is ignorant of economics yet tries to regulate markets: zero.
There can be only two results: either we'll have less medical care (think you're having a hard time finding a doctor now??), or we'll pay a lot more for it (think your doctor's visits are expensive now??).
But there is a different way: free market health care. Reduce every possible barrier to health care. First, stop protecting the doctor's union. Let anybody practice medicine, but give the doctor's union a super-trademark on the term "physician", just like the 4-H shamrock and Olympic rings are protected. If you want a graduate of a medical school, you can have one; just go looking for a physician. Second, stop treating us like children, and let anybody buy any medicine they want. Abolish the FDA. Pharmacies will compete to provide the safest and most effective medicines. Abolish the patent system. Drugs are only expensive to develop because of the FDA and don't need patent protection. Testing can be provided by pharmacies. Stop expecting doctors to be medical deities. Greatly reduce the available torts to only those things that doctors have control over, like leaving sponges inside patients after surgery. I'm sure there is more government hampering that I'm just not thinking of right now. Oh, yes, stop the war on (some) drugs. Abolish the ONDCP.
posted at: 04:00 | path: /economics | permanent link to this entry