Insurance or Entitlement?

The current debate about health care reform wavers from insurance to entitlement. Is healthcare an entitlement to be provided by government or is healthcare insurance an obligation to be mandated by government? The topic of debate changes so frequently that it is impossible to determine the real agenda.

First; we have already determined that health care is not an inalienable right granted by the creator, nor is it a right granted by the constitution, nor is it a biblical mandate. (Link)

It would be appropriate to ask if health care should be an entitlement paid by the government. We would point out that virtually nobody is denied at least a minimal level of essential health care services. Medicare, Medicaid, the Veteran's Administration, and federal government employee insurance pay for medical services for over 40% of the population today. In addition, all hospitals are mandated by law to treat anyone who comes to their emergency room regardless of their ability to pay. Therefore, healthcare has become an entitlement in spite of the fact that this may be unconstitutional.

Political posturing notwithstanding; it seems that the progressives in congress and the President are determined to increase government involvement from 40% to 100%. It is all about revenue enhancement. (Link)

This effort is so unpopular that the proponents have shifted their focus from entitlement to insurance.

Insurance is when a group of people pool their resources to indemnify each member against a future occurrence of an uncertain event. Our culture has done a severe disservice to us by allowing us to believe that we should insure against first dollar loss.

For example: Everybody needs to go to the doctor from time to time, just as everybody needs to eat and drive to work. We don't expect someone else to pay for our food or our commute to work. Why do we expect someone else to pay for every penny that we spend on healthcare? It is a colossal waste of money to insure against every little expense.

We should insure against the future occurence of an uncertain event. Visiting the doctor is certain. Hiring a surgeon to remove our colon is uncertain. Not everyone requires such surgery (praise God) so this is an uncertain event against which one could purchase insurance.

The most cost efficient method is to purchase insurance against something that would cause a severe financial loss. One should purchase insurance against catrastrophic losses and budget for ordinary expected expenses. Unfortunately, our culture gives employers and insurance companies incentives to provide more and more perks so that we have lost our perspective of the role of insurance.

My uncle was a sales manager for an international distribution company. As he interviewed a prospective sales representative he said, "You pay your own expenses. They are lower that way."

When a third party, like your insurance company, pays for your medical expenses; you have no interest in what they are. A redundant test? No problem, bring it on. A tummy tuck, breast implant, or viagra? YOU BET. My self esteem demands it. Premium or generic drugs? Hey, I deserve the best.

My wife and I subscribe to our employer's flex spending accounts that allow us to divert pretax money into a medical flex spending account. This is not insurance but tax advantaged forced savings which allows us to set aside funds for day to day medical needs. This system has several flaws; but it is a good start.

There is limited access to Health Savings Accounts. These too are nothing more than tax advantaged forced savings accounts that allow participants to save for their medical expenses. The HSA includes a provision for high deductible health insurance to pay for catastrophic health expenses. The progressives in congress hate HSA's and have deliberately placed restrictions on these to limit access to a common sense approach to health care reform.

The progressives and their synchophants in the mainstream media will not tell you that the Republican party has proposed a number of creative healthcare reform innovations that would lower costs, improve access, and put the responsibility for your healthcare in your control. Follow this link for more information.

My personal preferrence is a Health Savings Account coupled with the Wal Drug Plan (Walgreens, Walmart, and others offering generic prescription drugs for $4).

It is NOT in the public interest nor is it constitutional to require everyone to have health insurance. This is not the same thing as driving a car. Driving is a priviledge. All states require that you demonstrate financial responsibility before you can exercise the priviledge of operating a motor vehicle on public roads. The key here is "demonstrate financial responsibility";i.e., carry liability insurance or post a bond with the government.

Health care is a personal responsibility and you have a constitutional right (10th Amendment) and a biblical right to behave irresponsibly (Romans 1:28 through 32).

It is estimated that as few as 70% of licensed drivers carry liability insurance. Those that get caught are fined or imprisoned.

What evidence do you have that mandated health insurance will be any different? What are you going to do when someone gets caught without health insurance? Put them in jail? This is reminiscent of the debtors prisons from the eighteenth century.

We need to keep health insurance in it's proper perspective in our society. We need to allow insurance companies to offer innovative health coverage plans. We need to find a way to allow them to offer these plans in multiple states.

We do not need to:

Demonize insurance companies

Place the federal government in competition with insurance companies.

Place more mandates on insurance coverage.

What is Wrong with Health Care Now

Progressive Democrats have wanted to impose nationalized health care on the United States for as long as we can remember. It has always been posed as compassion for sick people; but it looks suspiciously like the human need to control other people in an effort to provide meaning to one’s existence. This drive for control has taken on an unusual urgency because the progressives now control both houses of congress and the presidency and this is viewed as a way to salvage the bankrupt Social Security and Medicare programs.

We have already shown how the public option will allow the government to increase revenue by skimming money from 1/6 of the economy, control costs by dictating reimbursement and access to treatment, and reduce demand by accelerating attrition.

Congressional committees have been introducing legislation written by progressive organizations with no thought to the real problems of our current healthcare system. One can only conclude that there is no real interest in solving problems. Congressional committees used to hold public hearings to solicit testimony on what problems exist and possible solutions; but that is not the case in this congress. This congress seems intent on simply jamming down a progressive agenda to grab private wealth and enhance the power of an elite corps.

Members of Congress and Federal employees will be exempt from the constraints of these programs because, as George Orwell wrote in ‘Animal Farm’, “some are more equal than others”.

Let us assume this is a perfect world and congress will hold public hearings to discover what, if any, problems are endemic to the health care system as currently constituted.
We would testify to the following problems that congress could address to the benefit of everyone.

Access to affordable health insurance is tied to one’s employment. It makes absolutely no sense. The reason for this custom wage and price controls imposed by the Federal Government during World War II. Companies could not pay competitive wages for superior employees; but they were allowed to offer benefits at no cost to employees and deduct those costs from the company’s income. Bonus: government contracts were based on cost plus profit so the higher the costs, the higher the profit.

The prices of health care services are not based on the cost of delivery. Prices are determined by Medicare reimbursement. When Medicare was introduced, it was a small percentage of the total health care industry and reimbursement was based on a percentage of local reasonable and ordinary charges. Over the years, the percentage of reimbursement has declined; so service providers simply raised their fees. The result is private insurers are subsidizing Medicare and Medicaid. These two programs pay nearly half the income received by health care providers. We will explore the negative effects of these policies in a separate blog. The most informative article we have found on this subject was written by Loren Steffy in the Houston Chronicle on Sunday, September 13 and linked here.

Federal and State laws mandating certain services. For example, hospitals must treat anyone who comes to the emergency room. This is by far the most expensive means of health care delivery and most people who go to the emergency room do not pay full price for the services received. The result is the local taxpayer, through the hospital district, pays the cost shortfall for operating the emergency room thereby subsidizing the cost of healthcare for uninsured and indigent clients.

You will notice that the top three problems with the delivery of health care in our country were caused by government. It seems incongruous to expect more government involvement to solve the problems that government involvement has caused.

Is Healthcare a Moral Imperative?

Approaching a coworker, I asked, "Do you know where I can find G.?"

"It’s not my week to monitor her." was the humorous reply.

I am reminded of Genesis 4:9 and 10. "Then the LORD said to Cain, "Where is Abel your brother?" He said, "I do not know; am I my brother's keeper?" And the LORD said, "What have you done? The voice of your brother's blood is crying to me from the ground. "

You will notice that the LORD did not say that Cain was his brother’s keeper. As you read the Holy Bible, regardless of translation, you will see that God does not want us to keep each other but wants us to rely solely on Him for all our needs.

God requires us to love each other, seek justice, show mercy, and walk humbly with Him. God has promised to bless each of us so that we will be a blessing. Neither the Holy Bible nor the Constitution of the United States guarantees a right to health care.

In fact; it can be argued that it is unjust to require persons to provide medical treatment without full compensation. It is unjust to require someone to pay for the medical treatment of someone else. It is unjust to ask those who behave responsibly to pay for the consequences of poor choices made by others.

It can be argued that it is more loving to force lifestyle change upon an individual than to enable destructive behavior by subsidizing treatment for the consequences.

The hero in the celebrated parable of the Good Samaritan (Luke 10:30) showed mercy by personally taking responsibility for the comfort and treatment of the unfortunate traveler. He was just as busy as anyone else. He paid his taxes just like the previous travelers who would not make the time to help the victim of violence. Yet he had the heart to show mercy and share his blessing.

The parable makes it pretty clear that we are to take responsibility for ourselves and show mercy when the opportunity arises. We are not our brother or sister’s keeper and we should not extort others to do what we think they should.

When you go through life humbly with God, you know you are NOT God’s partner in life and death. Only a dangerous narcissist would believe otherwise.

My Thesis: The argument that we have a moral imperative to provide healthcare to everyone is specious. Anyone making that argument is either ignorant of the moral basis of our society or is motivated by greed.

Health Care Reform will Salvage Social Security

The celebrated progressive, Pres. Franklin Roosevelt, introduced Social Security to provide income for older Americans. Supposedly this would allow them to leave the workforce thereby opening up employment opportunities for younger workers. It is funded by a payroll tax on workers and employers.

The funds were originally kept in a separate account. This account was used to pay benefits and the surplus was invested in government securities. The growing surplus of funds made it increasingly attractive for politicians to offer more goodies. Additions included death benefits, income for children under 18 who suffer the loss of a parent, and disability income payments.

President Johnson convinced the congress to fund the Great Society by combining the Social Security Trust Fund with the General Fund. The Social Security Trust fund is nothing more than an account entry. The change is subtle but the effect was substantial. The old Social Security surplus was supported by treasury securities that could be sold on the open market at any time. Now the surplus is spent and the government gives an IOU which has no value. Social Security has access to this money only if congress appropriates the funds.

Social Security was transformed from an actuarially sound annuity into a Ponzi scheme. The money that is collected is immediately spent on all government programs. The result is the account entry called surplus continues to shrink in size and will eventually become a negative number.

Ponzi schemes need more and more income to prevent total collapse. Congresses have increased the tax rates, raised the limit on income to be taxed, provided a means test for benefits, and even raised the age that benefits could be claimed. This has only postponed the day when the collapse will occur. Medicare has the same funding problems as Social Security. The only difference is the shortfall is even more urgent with Medicare.

What would happen if the Federal Government was the sole provider of health care? Trillions of dollars are spent on health care every year. How could a good Ponzi schemer resist the temptation to control that flow of funds?

When the government is the sole provider, they can improve the margin by simply paying health care providers less money. They can arbitrarily control how many expensive treatments are allowed per year. They can direct research dollars to political patrons. They can set the amount of money charged in taxes to pay for healthcare.

As sole provider of health care, the government will be able to enforce a policy of complete lives system. This is a policy whereby the largest number of health care resources are spent on persons from age 15 to 45 simply because they have the potential to return the greatest value to society.

As a bonus; reduced healthcare expenditures for unproductive citizens will cause them to simply stop draining scarce resources from our economy. This will help prevent the impending collapse of Social Security and Medicare.

It is a Ponzi schemer’s dream come true. There is no downside for the government and those who administer the government.

There is no upside for voters, taxpayers, young people, old people, ordinary people, and medical practitioners.

Bumper sticker of the week: "You will love Obamacare, unless you want to be born, or don't want to die."