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The Senate Health Bill: Not the Lesser of Evils

Posted By John Ligon On November 26, 2009 @ 10:36 am In Obamacare | Comments Disabled

No one knows for sure how Senator Reid’s health care bill (HR 3590) will impact any particular person or group, but this much is fairly certain: it will cause health insurance premiums to increase faster—not slower—than they would have otherwise. Even the Congressional Budget Office, Congress’s non-partisan accountants, says that premiums in the “public option” of Sen. Reid’s bill would turn out to be higher than premiums in typical private plans today. Thus, there are ways to “bend the health care cost curve” downward, but this bill does exactly the opposite.

While Reid’s plan, like all of the leading pieces of legislation, clearly seeks to expand coverage, he joins these other plans in failing to contain health care costs. These plans do little to address the issue of rising costs within the system, which is critical to actually ensuring access to healthcare services. Reid’s bill does not take into capacity constraints — and vast inefficiencies– that already exist in the healthcare delivery system, and it is uncertain if legislators understand exactly how these bills will affect physicians and hospitals.

Remember that government today spends $0.57 of every health care dollar on its own programs, Medicaid or Medicare [1]. Medicaid and Medicare already have huge rate-setting power in health care, and determine to a large degree the delivery of healthcare—including, in many respects, adding to the inefficient delivery of healthcare. So, it is highly questionable whether Reid’s bill will move the US in a direction of addressing the problems in the inefficient delivery (and financing) of health care.

Sen. Reid holds out a laudable goal of assuring that all US citizens have access to affordable health care coverage. However, if we only accomplish this and fail to rein in costs, then “real” health care reform is only being pushed later into the future. It is important for legislators to not think they are closer to patients and individuals than physicians and hospitals, and to remember that the long-term is quickly becoming the short-term. In other words, expanding fiscally draining government programs that are in dire need of reform will never be the right solution, and could seriously frustrate the whole enterprise of health care reform.


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URL to article: http://blog.heritage.org/2009/11/26/the-senate-health-bill-not-the-lesser-of-evils/

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[1] Medicaid or Medicare: http://www.heritage.org/research/budget/bg2114.cfm

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