Friday, June 05, 2009

Public Plan or Public Enemy? Our Conclusion

In Poe's The Purloined Letter, the thief hides the stolen item in plain sight. He knows that most folks tend to overlook the obvious, and takes advantage of that fact. In much the same way, members of our political class are using the innocuous sounding title "Public Plan" to (not so) surreptitiously implement a gummint-run health system.
How's that, you ask?
Well first, let's review the premise behind the so-called "Public Plan" (PP): the government will institute an "alternative system to private insurers, much like some states already use for their employees;" the PP would offer certain plan designs at set rates, presumably subsidized for those who can't (or won't) pay the higher premiums. Of course, the gummint has a poor track record in predicting how its policies will actually work in real-time. Case in point: current unemployment numbers. You may ask, "what's that got to do with gummint and health care?" The reality is that the Spendulus was supposed to create (and/or save) scads of jobs, and yet the latest unemployment figures show that we're worse off than if there'd been no Spendulus. Why would anyone think the Feds would be any more successful in anticipating the effects (and costs) of a nationalized health care system?
Meanwhile, we still have the unanswered question of how the PP will supplant the private sector.
First, the PP must recognize that health care costs drive health insurance costs, and that absent some downward pressure on the former, the latter's just going to continue to climb. There are only a few ways to control costs, and comparable systems we've explored (cf: the MVNHS© , Canada, et al) have done so through rationing, generally at the expense of those in their Golden Years.
Second, while the PP is advertised as being an alternative to insurers, it is in reality a substitute for them. How can we state this so unequivocally? Because we saw in the recent mortgage debacle that when the government meddles in private sector financial issues, we get mandated loans to folks who have no way of repaying them. And how does that apply to insurance? Well, when the government is buying and selling health care, it can use the power of the state to get its way, and thus the whole "level playing field" theory becomes a myth. How can private insurers hope to compete against the government, especially when the state can reduce fees at will, rather than through negotiation?
As mentioned in Part 1, I was particularly intrigued with Stuart Butler's term: "the down the road." First, the so-called "wall of separation" between the government and the market becomes blurred (Hello! GM, anyone?), and as costs continue to mount, there's every reason to believe that the government will continue its tradition of tinkering with systems about which it has no real experience or understanding. It becomes, in essence, the team manager and the umpire. What could possibly go wrong?
Mr Butler also observed that what people "heard" during the election is not at all what we're seeing proposed: that if one is currently insured, that wouldn't change. But of course, it must: as we've seen with Medicare [ed: did we mention that that's going bust in less than 10 years?], the gummint has, and uses, the power to shift costs to the private sector (insurance). Of course, when it's expanded to the population writ large, the problem is then magnified.
There are those who would argue that the PP is simply an extension of already-existing state employee programs. This would be disingenuous: no individual state has anything like the power of the Federal Government. Indeed, a national PP would control costs simply by controlling how much is paid, a sure-fire way to force health care rationing.
They say that a picture's worth a thousand words (and we're already up to 600+), so we'll conclude with this video, which neatly summarizes the inherent problems of a Public Plan. Or is that Public Enemy?
[Thanks to Lyndsi Thomas for the video link]
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