Free Market Solutions the Key to Health Care Reform
March 10, 2017
Health care reform is an enormous challenge because when it comes to economic policy, Republicans always have an uphill battle. Their free market solutions are harder to sell in a nation that has long had one foot in the socialism door.
Republicans express their belief in the free market, especially when they’re out of power and running against liberals and their failed policies, but they have a tougher time governing on conservative principles once in office. They often operate on flawed assumptions, seeking to accomplish contradictory goals and operating in an environment with two-year election cycles, which discourage making correct decisions for the long term.
But the GOP must recapture its belief in free market principles and muster the patience and political courage to promote them. Competition and free markets are the best avenues to economic prosperity, liberty and, in the case of health care, accessibility, affordability and quality. Yes, we must support some kind of safety net, but it ought to be designed to be short-term in as many cases as possible and should create incentives to encourage people to help themselves.
Some critics rightly note that Obamacare and other forms of socialized medicine are elaborate redistribution schemes, and that is true, as far as it goes. But our economy is dynamic; it is not a zero-sum game. Liberals conveniently ignore that their redistribution schemes, when extended to their logical conclusion, don’t just reallocate resources. Overregulation smothers market forces and destroys wealth, liberty and human dignity, and it is ruining American health care. It’s a shame that such issues rarely find their way into the public debate because it’s easier just to appear compassionate.
Indeed, it’s easy to be an economic liberal who pretends to care only about the poor. But feelings don’t translate into results and often sabotage them. The welfare system has diminished the work ethic, increased the incentive for people to reproduce out of wedlock and severely damaged the nuclear family, which has led to incalculable economic, moral and cultural problems across the board.
Republicans need to be more serious than the compassion-peddling Democrats and decide what they are trying to accomplish with health care reform. Why do people accept Barack Obama’s premise that health insurance coverage, rather than quality affordable health care, is the end goal? More Americans are technically covered today, but premiums and deductibles have increased, and quality has decreased.
Democrats, starting with the Clintons in the 1990s, changed the conversation to insurance coverage with the mantra that we had tens of millions uninsured. Lost in the conversation was any concern for premiums, deductibles, accessibility of care and quality of care. Though Hillary Clinton didn’t have the cachet to get Hillarycare passed, Obama crammed his warped vision down our throats.
But like all other socialistic solutions, Obamacare was terminally flawed. Government intervention was already the biggest enemy of quality affordable health care, and Obamacare was just another cynical weigh station on the way to single-payer, fully socialized medicine.
Health care is a complex issue, and its complexity increases along with greater government intervention, which makes reforming it quite difficult. We must begin by rejecting the assumptions that health insurance is a constitutional right and that medical services can be free. We don’t need health insurance for every routine medical procedure, as opposed to bigger or catastrophic items, because insurance is about unforeseen risks and routine procedures are foreseen. And when we insist on coverage for those with pre-existing conditions, can we at least be honest that we are also violating the concept of insurance?
Though I don’t pretend to be an expert on the specifics, I am convinced that principles of free market competition must infuse any health care reforms we ultimately adopt. This means eliminating as many regulations as we can, removing barriers to competition across state lines, implementing tort reform, allowing unlimited health savings accounts and somehow disentangling ourselves from a system in which the health care consumer pays only 11 percent of his own health care costs, with the remainder being paid by employers and other third parties. Under the present system, people have no incentive to be prudent and frugal consumers, and providers have no incentive to reduce costs.
In fairness, we must also concede that accomplishing such reforms legislatively is extremely difficult. It’s infinitely easier to advocate full repeal or “repeal and replace” when you’re the opposition party. But achieving reform in a democratic system designed to retard legislative action is a different animal. We don’t even have a consensus on the Republican side, and the Democrats are and will remain in full obstruction mode.
Critics must soberly acknowledge the immense difficulty of such reforms and have some appreciation for pragmatic considerations, such as passing what we can through the reconciliation process, which only requires a simple majority, and advancing other items separately, if necessary. We can’t just snap our fingers and get things done.
I am somewhat conflicted on this because part of me believes we should just repeal the whole thing and be done with it, but the other part is aware of the difficulty of getting a consensus to actually pass legislation.
I think House Speaker Paul Ryan and others deserve credit for trying to move this in the right direction, but I am still concerned that the American Health Care Act wouldn’t go far enough or fast enough — especially when economists and conservative think tanks I trust are very skeptical of the plan. We must understand that piecemeal solutions regularly create greater problems down the road, which we’ve seen with the problems created by the expansion of Medicaid in some 31 states. Once you increase people’s and states’ dependence on the federal government, it is harder to wean them off on the road to true market reforms.
My hope is that we approach this and any other proposed reform legislation skeptically, but not cynically, and that we evaluate it in terms of whether it would advance health care in the short term and long term — toward a market-based system, which is the surest and best way to achieve affordable high-quality health care. If the American Health Care Act, along with the next two phases of legislation, can eventually accomplish that, I’ll be for it, but the jury is still out.