The Medical Freedom Channel

Same Editorial this week, since I am preparing for my live radio appearance on Thursday, May 24th at 11:00 a.m. Mountain Time (TWO P.M. Eastern), on the subject of healthcare reform – specifically addressing the idea of getting us out of the “insulation” paradigm and back to self-responsible, prevention-focused individual parameters of wellness. It won’t be new to regular readers, but we’re hoping to expand the scope of awareness to more and more people, and be of some aid in slowing and stopping this train to disaster, and turning it around a bit. Oh yes, the location: “Wake Up America,” on the newly revamped Free Market News Network website, with a streaming live broadcast.

And now the existing editorial, still relevant and still awaiting your comments:

Last week, we presented the Healthy Businesses, Healthy Workers Reinsurance Act, as introduced by Sen. John Kerry [D-MA], as a halfway-intelligent step toward real healthcare reform. Since it seems that the only way to counter the continued skyrocketing costs, even for maintaining our basic wellness, is to encourage more people to practice self-responsibility and preventive healthcare measures, even a subsidy program that seeks to help protect against catastrophic circumstances may be necessary to assist in this effort.

Since the partial intent of that column was to provoke constructive rebuttal feedback (the kind that goes beyond the level of “socialism ee-vill, freedom good” that such postings received in other venues), and since there has been exactly ZERO feedback here …

Therefore, we now present a piece analyzing the latest “silver bullet” answer to reforming healthcare, from the newly formed Coalition to Advance Healthcare Reform, an insurance-industry collective claiming that it has the real answers. Inasmuch as we’ve taken the position repeatedly, in this space and others, that opting out of the conventional “health insulation” model is a necessary first step in turning back the healthcare Leviathan, it’s only appropriate that we also note what Big Insurance thinks is the right pathway to follow in getting out of this mess.

However, rather than pose as the expert on the subject (which is hardly the case), we shall instead present several differing perspectives on the CAHR program (with minimal comment on our part), then let you readers continue the discussion on its merits and drawbacks. (Note that Monday’s lead commentary by Ronald Bailey addresses this same issue; even more grist for the mill!.)

We’ll begin with what CAHR has to say for itself. On its own website, the coalition states its purpose, listing five “core Principles: behind its agenda. However, a more succinct formulation of these was presented in a Washington Times guest column last week, by Steve Burd, CEO of the Safeway grocery-store chain and a prime driving-force behind this idea.

As Burd notes in introducing his essay, “At the current growth rate, health-care costs will be 25 percent of the United States gross domestic product by 2012. By next year, the average Fortune 500 firm will have a health-care bill that exceeds its net income. And today, 47 million Americans are living and raising their families without health insurance. … We believe health-care reform must happen before 2009. Waiting longer until 2012 or beyond is simply not good enough for the millions of uninsured Americans, businesses struggling to provide affordable benefits or the insured who fight to keep up with rising costs for coverage and care.” And thus, 36 business and industry leaders have formed this Coalition to Advance Healthcare Reform, with these “Core Principles”:

“First, because market forces are largely absent in today’s health-care system, costs are spiraling out of control. Market forces, if properly introduced, can fix this problem. Through consumer orientation and transparency we can create a health-care system that delivers better outcomes and lowers costs.

Second, every American should be required to carry health insurance. At the same time, everyone should have access to affordable health care services with no exclusions for pre-existing conditions. The market should drive these policies, with government, business and individuals sharing responsibility to ensure affordable coverage is achieved.

Third, we must provide assistance for low-income individuals to obtain coverage. Providing financial assistance will enable all Americans to have the routine and preventive health care they need through traditional venues, physicians and clinics, instead of emergency rooms.

Fourth, since 50 percent to 70 percent of total health-care costs are behavior driven, health-care plans must be designed to promote healthy behavior starting with prevention and wellness and incorporating full-care management programs for those with chronic and acute conditions. Individuals and families should have personal financial incentives for adopting healthy behaviors and disincentives for poor behavior. Federal and state governments could advance this immediately by instilling these same provisions for government-administered plans and workers, including members of Congress.

Finally, individuals must be able to purchase health care in the same tax-advantaged way as businesses do now. Today, health-care premiums are tax-deductible to business, but not to individuals. The time has come to end this World War II-era policy and level the playing field.

Burd concludes, “The private sector can bring innovative solutions to the table. Within our own companies, many of us have experienced the incredible results of reform by acting to reduce costs and provide better care. We have an enormous opportunity to help people live longer, healthier lives by encouraging our nation to prevent the preventable. … Through smart reforms, we can reduce this country’s health-care bill by 25 percent and in a way that doesn’t require large revenue increases.“

Brave words to be sure, and some valid points made. However, as one criticism, we note that nowhere in these principles is there any acknowledgement that “lack of coverage” is only the symptom, and not the disease. It’s “lack of access,” combined with the spiraling costs of even the simplest preventive procedures, that is the true problem in healthcare. Fifty to 75 years ago, there was no health insurance to speak of; there was also no real healthcare problem. As more and more people are finding out, there are other pathways to wellness, outside of the conventional “insurance” game.

But we promised to only comment briefly …

Among the online criticisms of CAHR, the most notable so far is a Tom Paine column by Bill Scher of the Campaign for America’s Future, entitled, “Universal coverage for the not-poor.” Not surprisingly considering the source, Scher begins with a direct challenge to the idea that “market forces” can play a positive role, mistakenly (in this editor’s view) blurring the distinction between what an actual “free[r] market” does, with the ban-it-or-subsidize-it, mixed-economy statist mishmosh with which we are currently saddled.

However, with those terms redefined, his critique rings true, at least on initial review of the data: It is indeed hard to see what value there is in having the same industry that largely contributed to the present healthcare fiasco in the lead in “reforming” the system it has fostered. Scher cites as “the crucial debate” the issue of “what role government should play to secure affordable, quality coverage for all,” and notes that this coalition, whatever positives it may present, still “appears to favor continued restrictions on our government’s ability to keep insurance companies honest and serve all the public.” (He also notes the presence of many “insurance and pharmaceutical companies” among the CAHR ranks, which gives the appearance at least of “foxes guarding the henhouse” as usual [sentiments paraphrased].)

His biggest challenge to the Coalition’s “core principles” is not unexpected, given the source: Noting that Burd’s Times piece calls for “market forces” as a road to recovery, Scher declares, “Uh, come again? He doesn’t see that it’s market forces that entice insurance companies to cherry-pick the young and healthy as customers to score an easy profit, leaving millions behind without insurance, leading to higher costs for everybody? This complete misreading of the problem doesn’t bode well for any future policy proposal.” (Note: Scher may perhaps be forgiven for this statement, since in our own lifetimes there have been so few actual examples of “market forces” at work in the real world; he could note advances in the less-regulated areas of the economy — the computer industry, and the Internet itself — but that might be asking too much to. The fact remains, however: neither the insurance realm nor Big Pharma have any great claim to using “market forces” effectively in their own dealings.)

Scher correctly notes that the imposition of mandatory “coverage” would “be a great deal for the insurance companies. They would get millions of new customers in one fell swoop without having to comply with much new regulation. But for the rest of us, it would be nothing more than a dressing up of the same failed health care system.” He predicts continued “cost squeezing” and “rationing of care,” along with the same runaway costs elsewhere.

Naturally, Scher’s own prescription is the same old “universal, single-payer insurance” whine, and in his case, he wants the government to become that single payer, putting “private companies out of business” in the process. He considers the major obstacle to this to be “convincing those who are happy with their insurance to switch to a new system.” (To his credit, we note that Scher would seek to “convince” them, not merely impose upon them the system of his own crafting. It is indeed nice to hear that perspective from the “progressive” front, given how often its adherents seem more focused on forcing their views on others.)

As an alternative, he proposes the “Health Care for America” proposal advanced by Yale professor Jacob Hacker, which calls for a “Medicare-style public plan for all Americans under 65.” The advantage here, he says, is that the plan would not outlaw private ones, but would “level the playing field … Employers would have to provide good quality coverage or help fund the public plan.” However, the mere fact that he is advising the expansion of Medicare, a “charity program” by design, to “cover” everyone betrays his essentially paternalistic agenda.

Over in the so-called “mainstream media,” a Los Angeles Times article actually attempts to save us all some homework, with a point-by-point comparison among the coalition’s proposals, Gov. Schwarzenegger
California plan and other prescriptions being advanced by the state legislature, from both sides of the aisle. The CAHR proposal is summarized as such: mandatory health insurance for everyone; subsidies for those with low incomes, with all pre-existing conditions covered; incentives for healthy behavior and prevention; tax deductions for individuals who buy insurance; and costs of care revealed to consumers.

Gov. Ahnold’s plan, strikingly similar in many aspects, calls for: mandatory health insurance for everyone; subsidies for low incomes; incentives for healthy behavior and prevention; pre-existing conditions covered, with no penalty for being unhealthy; and tax-free savings accounts allowed for the purchase of high-deductible insurance. (The rest of the Guvernator’s plan is much more intrusive, but it does already contain most of the CAHR’s basic principles.)

Meanwhile, California’s Democratic leadership is promoting, along the same lines: employer-provided insurance or payments to the state fund; workers required to accept insurance if it’s offered; incentives for healthy behavior and prevention; mandatory insurance for families with moderate incomes or higher; insurers could not refuse to sell policies to anyone, and insurers must offer plans with uniform benefits

The Republicans would add these provisions: tax-free savings accounts for high-deductible insurance; increased state payments to doctors and hospitals that treat the poor; medical providers get tax credit for unreimbursed treatment; reduction of mandates on what insurers cover; and all pre-existing conditions covered. (As with the other party’s proposals, there are other far wider-reaching issues addressed, but these are the parts that march almost completely to the same drummer as the CAHR premises.)

Over in the progressive-yet-still-legitimate-news arena, NPR’s Marketplace chimed in with its own evaluation, “Big business targets health care reform, leading with, “A group of Fortune 500 companies announced today their support for reforming health care and the formation of a coalition that will push for mandatory market-based health insurance.” The analysis continued, noting that the primary motivation for this coalition is, of course, saving money, quoting Steve Burd as saying, “As more people become uninsured, those of us that insure our employee base, we pay more for insurance, and restating the Coalition’s mission as: “mandatory market-based health insurance with no exclusions for pre-existing conditions, financial assistance for low income people, and incentives that would promote healthy lifestyles.”

The reporter then noted that, despite Burd’s fervor for this new approach, “many of his own company’s hourly employees have to wait months before they can get coverage. That’s the result of a union contract tussle a few years ago.” She cited Rick Wartzman, a senior fellow at the New America Foundation, as calling it “a little disingenuous on his part to be calling for universal coverage on the one hand, and then on the other hand, to have his employees wait 18 months and their families 30 months to get health coverage.” However, even Wartzman commends Burd and the coalition for “at least trying to find a way to extend coverage to thousands of uninsured workers.”

In summary, this plan by the Coalition to Advance Healthcare Reform has some potential for at least helping with the healthcare fiasco. However, as has been noted consistently for some time by this editor, any policy focusing on insurance, instead of promoting self-responsibility for prevention and wellness, is going to miss the whole point, attacking the symptoms and not the illness itself. Now it’s time for your comments; what do you think about all of this?