Debt Commission Encourages a Second Look at Public Option

Published 11/16/10

It’s not surprising that last week the Debt Commission chairmen recommended a second look at a “public option” for health insurance. It’s not particularly good timing though, for those who would support such an effort, in light of the recent midterm election results. Former Clinton White House Chief of Staff Erskine Bowles and former Sen. Alan Simpson (R-Wyo.) put together a report with some bad ideas – and some good ideas – about how to solve our current deficit problem. From The Hill:

In their report, Bowles and Simpson urged Congress to set a global target for total federal health expenditures after 2020 and to review costs every two years to keep the growth of healthcare spending in line with the increase of gross domestic product plus 1 percent. If costs exceed targets, the fiscal commission’s draft proposal would require the president to submit to Congress reforms such as the public option to lower spending.

At this point I must inject a thought about the “public option.” If indeed the problem with our health care system is that “the people” cannot afford health insurance or health care, is there really a solution that involves “the government” paying for it? The government does not create wealth; it only forcibly takes it from us, the people, the taxpayers. So the idea that a public option would lower costs is preposterous. If anything, it would create an artificially high demand for health services, only pushing prices up higher. It doesn’t matter who is paying the bill, a higher demand will always push prices up.

To avoid the push upward, we might expect the government (eh-em, as in Massachusetts) to put limits on how high premiums or payments might be. This didn’t turn out so well for insurers in Mass., who were forced to sell their products at a loss, and trust me, that’s not a sustainable situation for any type of business.

For real reform, we should focus on the cause of the high costs, not move them around from some Americans to others (in the form of a public option). According to Bowles and Simpson, one method of cost reduction is this:

They suggested paying doctors and providers less, improving efficiency and rewarding quality care by accelerating payment reforms.

And then I thought, oh no, don’t they know that doctors face high costs as well, such as malpractice insurance? But it turns out the chairmen’s report did contain at least one good idea:

The chairmen also called for “comprehensive tort reform” to “reduce the cost of defensive medicine,” a proposal that is sure to get a negative reaction from Democrats and the trial lawyers who contribute to their party.

Let’s hope that if the day ever comes when tort reform is on the table, that it won’t get caught up in nonsense politics. The real answer to the deficit problem – and the health care problem – is more freedom. We should be giving doctors and patients the freedom to pursue the best treatments at the best prices. That doesn’t mean a public option; that means getting the government out of the health care business.

 

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