Misleading Assumptions Confuse Healthcare Debate


Let’s start by agreeing that the goal is the best possible healthcare treatment for every American. That means the best access to medical care. But achieving that goal is much more complicated than it seems. To understand this complexity it is necessary to address some common assumptions that may seem intuitive but in fact are misleading.

Having health insurance leads to healthcare treatment. The assumption many people make is that having healthcare insurance leads to getting healthcare treatment. In fact, the wrong kind of healthcare insurance may be an obstacle to healthcare treatment. The best example of this is Medicaid. Since only about half of doctors accept Medicaid patients (and most of those limit the number of Medicaid appointments) it is very difficult for these patients to actually receive medical care. Furthermore, they are prevented from paying cash to those doctors who don’t accept Medicaid since this is illegal – the doctors could lose their licenses. As a result Medicaid patients have poor access to healthcare and use ERs for primary care 40% more than even the uninsured according to an Oregon study.

ObamaCare exchange private insurance is better than Medicaid, but not much. More doctors will accept this insurance than Medicaid, but the deductibles are so high ($6000 average for individuals; $12,000 for families) that they often can’t use this insurance, either. They have insurance, but still lack good access to healthcare.

Having any healthcare insurance is better than having none – This seems intuitive, but again it may be inaccurate. If your insurance is Medicaid, you may face the access problems I discussed above. For this reason and others, one-third of all Medicaid-eligible patients before ObamaCare did not enroll in this free government healthcare insurance.

Why not enroll in a free healthcare insurance program? Without Medicaid the uninsured can negotiate cash discounts from virtually any doctor they choose to see. Therefore, they have better access to healthcare without insurance. True, they risk catastrophic medical bills if they become seriously ill but many accept this risk. In reality, numerous medical studies have demonstrated that the uninsured have better healthcare outcomes than those on Medicaid.

The Congressional Budget Office (CBO) is non-partisan and accurate – If only this were true! (see my recent post How Accurate is the CBO?) In reality, the CBO has demonstrated time and again that it leans left with overly optimistic predictions about ObamaCare and overly pessimistic predictions about the American Health Care Act. Here is a graph showing the accuracy of the CBO in predicting ObamaCare enrollment:

The CBO is using faulty data with unreasonable expectations for the status quo (ObamaCare) when comparing it to the proposed new healthcare (AHCA). Most importantly, CBO predictions reflect what they think people will choose to do; not what the law will force people to do. Many will choose to drop their Medicaid or ObamaCare exchange insurance if freed from the government mandates that forced them to enroll in a plan they didn’t want.

The status quo (ObamaCare) is better than the proposed change (AHCA). Kimberley Strassel of The Wall Street Journal called the AHCA a “home run”. The AHCA is not perfect – far from it. It’s just so much better than ObamaCare that she characterized the improvement that way. But the AHCA is a good start for the process of finding a better way. (It could be improved by making the tax credits means-tested rather than flat to increase support for poorer Americans with less for those with higher-incomes.)

Left out of the discussion is the fact that ObamaCare is in a death spiral and will certainly collapse completely within a year. Many states will be down to one insurance provider in 2018 and some will have none! So the status quo is unacceptable and a better system must be found.

Free insurance for everyone is a good thing. Of course, there’s no such thing as “free insurance” because the taxpayers are paying for it. But the goal of Democrats is to provide “free insurance” for everyone. Senator Bernie Sanders likes to call it “Medicare for all.” The assumption here is that this solves all the problems because everyone will have health insurance. Yes, they may have health insurance – but they won’t necessarily receive healthcare.

This kind of system is referred to as “single-payer” healthcare – a variant of socialized medicine. The government pays all the healthcare bills – and is in complete control. That means they choose your doctor, your appointment time, and even your treatment – if you get treated at all! In such systems the government routinely decides that anyone over a certain age is no longer eligible for some treatments.

In every socialized medicine system in the world, (Canada, Great Britain, Sweden) the government controls costs by controlling access to healthcare. This not only delays treatment but leads to poorer healthcare outcomes. If you compare cancer treatment outcomes in these countries to our country we are dramatically better. That’s why anyone from these countries with the money to afford it comes to the U.S. for their healthcare. (see my recent post Single-Payer v. Market-Oriented Healthcare: Which is Better?)

But you don’t need to look outside this country to see the failure of socialized medicine. Right here in America we have a large socialized medicine system – it’s called the VA. The entire VA system is paid for and controlled by the government. These patients all have health insurance – yet many have died waiting to get medical treatment.

In 2014 it was revealed this tragedy was happening at the Phoenix VA and many others as well. Although there have been some improvements since then, the same basic problems persist. The only real solution is giving veterans the freedom to seek their healthcare through private physicians outside the system. Socialized medicine always leads to delayed treatment – and poorer healthcare outcomes.

ObamaCare has added 20 million Americans to the ranks of the insured – but 15 million of them are on Medicaid and the other 5 million have such high deductibles they can barely use the insurance they have. I believe there are solutions to these problems but it will not be easy in the politically charged atmosphere of Congress and with a mainstream media dedicated to promoting the distortions of Democratic talking points.

Sooner or later, there will come a tipping point when the American people will have to decide if they want socialized medicine or they want to retain the freedom to choose their insurance, their doctor, and their treatment. If they choose what Democrats are pushing, the once envied American health care system will become just another government run program.

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