10 August 2009

Healthcare Contrarianism in an Age of Consensus

It was once hip to question authority, partisan allegiances be damned. Among those who once chanted "Hey, hey, LBJ/How many kids did you kill today?" in protest against the Vietnam War, at least a few were left-of-center types more likely to be lumped in with Johnson's Democratic party than with the Republican one. In our modern political climate, however, loose political coalitions sink campaigns. In an age when "spoiler" candidates like Ross Perot and Ralph Nader are almost universally decried as having "taken votes" from their rightful, major-party recipients, the level of intra-party criticism is ebbing ever lower.

Years after the rise of George W. Bush to the presidency, I recall seeing many proud Republicans driving cars sporting "W: The President" stickers, apparently indifferent to the fact that Bush grew government faster than Clinton had, dwarfed Clinton's military expenditures, and threatened other nations with the reckless abandon of the too-drunk friend who you try to whisk out of the bar before he gets himself into trouble. Now, well over six months into the Barack Obama administration, the new president's devotees are likewise still devoted, wearing Obama t-shirts, sporting his campaign stickers on laptops and cars, and denouncing opponents of Obama's policy proposals as partisan, possibly racist no-goods who in the words of Obama himself "created this mess" and ought not "do a lot of talking."

Just as Bush supporters did when they claimed that opponents of the Iraqi and Afghani wars were "with the terrorists," Obama and his supporters pose a false choice: either you give carte blanche to the people in power on Capitol Hill or you are a war-mongering, possibly fascist, indigent-hating Republican. This false dichotomy ignores the fact that millions of Americans have steadfastly opposed government cartelization of the healthcare industry for years, criticized Bush's approval of a massive prescription drug bill, and were just as eager to march against Republican wars in Iraq as they were to protest Democrat-led adventurism into Eastern Europe and Northern Africa.

One doesn't have to be a pro-war neoconservative to see that the further bureaucratization of the medical services industry, especially where price controls are likely, will result in fewer choices for consumers, less flexibility in treatment regimens, and another reason for our benevolent government overlords to further regulate what we eat and drink and smoke. However, by allowing a market rather than a panel of bureaucrats to set prices, shortages could be mitigated in the short term and eliminated in the long term. In a market where prices are a function of supply and demand, prices rise as supplies become more scarce. Free market prices act to prevent wasteful usage of scarce resources, like that of Medicare patients who call an ambulance scores of times for minor or imagined maladies, because such overusage would break the bank for the wasteful patient. Likewise, where there is a more fundamental supply issue, rising prices both encourage entrepreneurs to devise more efficient ways of serving patients and bring more service-providers into that sector of the market.

Although there is much wrong with the healthcare plan being pushed by the majority party right now, it is important to note that this does not mean that the status quo in the United States represents a "free market." Nothing could be further from the truth. Even without the Democratic plan, we have a medical labor cartel, the American Medical Association, in place to artificially limit the supply of medical services and raise their prices. We have lengthy pharmaceutical patents that prevent competitors from reverse engineering drugs sooner and from devising cheaper ways to bring those drugs to market. We have an incredibly onerous drug approval process that is so expensive as to frustrate the business plans of all but the largest of drug companies and keeps possibly life-saving drugs out of the hands of desperate patients who ought to be allowed to do their own risk/benefit analyses when their lives are the ones on the line. Huge entitlement programs like Medicare and Medicaid, while burning through money like almost nothing else besides the military, ensure that the poorest segments of the population will receive substandard care and annoyed looks from paperwork-hating triage nurses.

It is true that the United States has a healthcare system, at present, that is marginally more free than those of many other nations. Although there are price ceilings for certain patients under certain government entitlement programs, there is still a private market in healthcare that allows prices to adjust to their natural levels. For this reason, many foreign medical professionals immigrate to the United States, where their expertise will be better compensated and utilized than under the mess of bureaucratic red tape in their countries of origin. The fact that the United States is effectively alone among industrialized nations in not instituting a single-payer healthcare system is no argument for such a policy. Political keeping-up-with-the-Joneses is lazy and irresponsible in public policymaking.

The United Kingdom's National Health Service (NHS) is often raised as an example of a single-payer healthcare success story, but the NHS's own statistics show that the number of general practitioners per capita in Britain has fallen dramatically since the imposition of the NHS monopoly. Despite long waiting lists, substandard facilities, and doctor shortages, Britons will have to put up with their bureaucratized healthcare system until the whole British house of cards comes down, because the NHS is now the largest single employer in the United Kingdom and one of the top five employers in the world. With that many people drawing a government check from NHS, the program is entrenched, its miserable failure notwithstanding.

Here in the land of the free and the home of the brave let us actually expect a little personal responsibility. Individuals should plan financially for foreseeable medical expenses and remember that medical insurance is best reserved for catastrophic medical events. Eliminating the administrative costs associated with bureaucracy (and preventing the imposition of more such costs) means prices must fall eventually, all things being equal. Lower prices would mean that voluntary charities could better afford to serve more individuals, but without causing the distortion in the market that government bureaucracies do.

Pretending that we can totally abandon personal responsibility because we have a "right" to the labor of doctors, nurses, and hospital administrators only confuses the issue, discourages talented individuals from pursuing medical careers, and insures that the American healthcare system will continue to decline. Government monopolies didn't carry the now-commonplace heart bypass procedure from experimental to routine, the market did. There is no room for the government in healthcare.

(Also published in the Orientation 2009 issue of
Dicta, the Suffolk Law paper.)

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