Here's another one I've transcribed from my
blog. Let the controversy begin.
Health Care: An Easier Road
September 23, 2009
By Farther Up
There are two types of political thinkers in the United States. The first group thinks that only the strict enforcement of governing bodies, with their attendant bureaucracies, can bring about desired results. The second group firmly believes that the proper incentives coupled with well-constructed social structures –like functional free markets- can produce desirable behavior. Setting aside the philosophical question about whether or not leaders and governments should seek to direct the behavior of others, the contrasts between the aforementioned groups are tremendous. The current debate about health care provides some demonstrative examples.
The general consensus among many on the Left is that there ought to be a large, government-sponsored entity that provides subsidized insurance to the American public. The basic idea is that such an entity would have market power: the ability to dictate the prices it would be willing to pay hospitals and doctors for their services. It would have this power because it would be one of the few (if not the only) customers for medical practitioners. The Left desires this “single payer” or “public option” because it solves a major problem in American health care: it’s cost.
More Liberal* minded individuals, on the other hand, believe that there is a much simpler way to reduce costs. Instead of giving a government firm market power to bargain down prices, give individuals more liberty to dictate their own health insurance plans. Currently, the payer for most private insurance is not the same as the individual receiving services. This is because most private insurance comes through private work-place benefits. As such, individuals over-consume health care services because they do not face the full costs of using them.
A simple way to reduce costs would be to allow individuals to select their own insurance policies so that they can see and understand the differences in co-pays, premiums, and more. This ought to reduce costs because it would end, rather quickly, the over-consumption of health care. This method is, of course, a much more liberal and less complicated one than the one expounded by the Left.
Another instance of the contrasting in political thought in the United States is the debate over the quality of health insurance Americans receive. The Left generally believes that a large government-run solution health insurance firm would ensure that individuals receive better quality of care than they do now.
Others, however, point out that the problem is that private insurance providers are not directly accountable to individuals. Instead they are accountable to private firms whose biggest incentive is to keep premiums down. The way most insurance companies go about this is to reduce benefits.
A simple, Liberal solution to this is the same one expounded before for fixing health care costs. If individuals can select their own health care packages, then private insurance firms become accountable to them. This in turn leads to better service. No more denied coverage or frivolous waits. It would be similar to the markets that exist for auto-insurance and life insurance: flexible choices that give the individual the ability to meet his or her needs.
A final example of the contrast in the mentalities of political thinkers is the question of how to provide health care for every individual in the United States. Currently, the Left advocates an expensive government-run system of health insurance with complicated regulations for private insurers. Further, the Left also calls for stiff penalties on those who do not buy insurance.
A simpler and more Liberal approach is to subsidize private insurance markets. If the goal of the United States government is to insure all Americans, then the easiest way to do this is to provide subsidies, either through tax credits or some other scheme for Americans to buy it. The proposition to subsidize private consumption is not very shocking because the government already provides subsidies to Americans to buy food and other goods from private firms. The government could even subsidize according to income level if it wanted to just to make sure everything was “equitable” (and less expensive).
Either approach will probably solve many of the problems currently in the American health care system. However, one approach is complicated and gives the Federal government a tremendous amount of power over the private lives of individuals. The other gives people the liberty to make their own choices about health care while at the same time achieving the same policy goals. Of course, the two solutions outlined are truly just reflections of the rift in opinion between those who want more centralized control to direct human behavior and those who believe that the same behavior can be achieved through proper adjustments to incentives. Perhaps most importantly, however, one method is also significantly less expensive for the government and for the future generations who will have to repay the government’s debts.
*Note that “Liberal” here refers to liberal in the classical sense of the word, not the modern sense used by most Americans.
© 2009 Farther Up and Further In
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Topic: *Cracks Knuckles and Posts Something Controversial* Health Care (Read 368 times)