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Some sanity regarding the healthcare debate.

Posted by Euroranger on August 23, 2009

Late lamented common sense

Late lamented common sense

I’m saddened that the formerly ubiquitous “common sense” most folks used to have and treasure was tragically thrown under the bus a few years back and its dead and mouldering bones are only noticed nowadays when some shrieking “debater” trips over them by accident.

Allow me then to be the guy to pitch those common sense speedbumps into the healthcare debate forum today because clearly, they are lacking and such lack concerns me.

Before we begin, let’s lay out some Facts.  I feel like I need to bold the word because those who get carried away with political debates tend to assume that something that is “a truth known by actual experience or observation” (dictionary definition of fact) can be changed to something else in order to suit their argument.  This is something I cannot abide.  So, for the sake of all sanities involved, facts, like the following, are immutable and should be regarded as the absolute foundation for any discussion about the topic:

Fact 1:  Both sides of the debate want changes made to the way health care in the United States is acquired, delivered, dispensed and so on.  Both sides agree it is too expensive and has too many gaps to be a sustainable model indefinitely.

Fact 2:  The real difference between the two sides isn’t who wants health care for all…it’s who should pay for it.

Fact 3:  The president has proposed a plan that by all reasonable estimates will end up costing $1.05T (that’s TRILLION…as in one thousand billions) over 10 years.  Or more reasonably put: $105B per year.  For a means of comparison, the total federal budget for 2008 was around $2.98T.  (Make a note of these numbers…they come into play below)

Fact 4:  The plan the president has proposed is to insure all uninsured…what?  Sometimes you hear it stated as Americans.  Other times the number is approached in reverse (e.g.: “there are X million uninsured”).  Regardless of the terminology used (and this is a VERY salient point for me) the number of total uninsured in the USA is around 45 million people.  That number is typically broken down into 20 million American citizens and 25 million “other” people.

Fact 5:  The federal government already manages health care in at least 3 public delivery systems: Medicare, Medicaid and the Veterans Administration.

Fact 6:  The health care industry in the United States represents around 14% of the economy/GDP.  That is, around 1 dollar in every 7 has something to do with healthcare in our economy.

So, starting with that basis, let’s look at what the proponents for the president’s system want to do: a system to insure 45 million people for a cost per year of $105B or roughly $2333 per person per year.  Put in other terms, a family of 4 would represent $9333 in cost in order to insure.  Along with this the plan is also supposed to include legislation limiting cost increases, reducing care denial (for things like elective surgery for example…and perhaps redefining what ‘elective’ actually means) and creating a “public option” or even a “single payer” system.  Those last two terms need to be defined to be appreciated.

A single payer system means you have but a single source to purchase your insurance from.  In this case it would be either the government directly or a corporation created and funded by the government.  This means no competing insurance companies.  No Aetna.  No Kaiser Permanente.  Nobody but Uncle Sam Insurance.  In private industry, that’s called a “monopoly” and it’s illegal.

A “public option” system means the creation of a government insurance issuance entity just like in the single payer system but other insurance companies would be allowed to “compete” with it.  However, because the public option insurance company is funded by the taxpayer it won’t be allowed to become insolvent.  This means that it can freely operate at a loss in order to compete with for-profit insurers…and that’s really not competition.  So, let’s face the fact that the “public option” idea is really the prelude to the single payer system because alternative sources of insurance won’t be able to compete with a competitor whose existence isn’t governed by market forces such as profitability and financial viability.

Now, to go back half a step…$2333 for every uninsured person in the USA today.  However, let’s be real for a moment: is it, and should it be, the responsibility for American citizens to pay, via their taxes, for the healthcare for illegal aliens?  This is a debatable point although I think anyone who believes it IS our responsibility is soft in the head and clearly in need of more immediately applied socialized medicine like a 14 oz claw hammer applied liberally until such inane bullshit ceases to issue forth from whatever responsive orifices the patient has left at that point.  So, let’s throw the right wing nutbags a bone and say we’ll only insure actual American citizens with this plan.  Well, if we do that, the cost per person for this plan can either be inflated to be $4200 per person per year or the overall cost of the plan can be reduced to under $47B per year (down from $105B).  Now, we could all hope that the government, when given the option to spend more or spend less taxpayer money would choose less…but we’re trying to be realistic here.  Let’s say for sake of argument, the plan now costs $4200 per person per year.  That same household of 4 now costs $16,800 per year to insure (up from the previous mentioned $9333).

Now, step back a moment and simply gaze upon that number…hell, gaze on either one.  Anywhere from $9333 up to $16,800 to insure a family of four previously uninsured people.  This is the part of the post where I want you to use YOUR brain and consider those numbers and then try and guess where I’ll go next.  Go ahead, I’ll wait.

Okay, time’s up.  If you currently work and your employer provides your health care coverage you likely don’t know the TRUE cost of your health insurance.  You likely contribute an amount to it and your employer likely contributes what’s left over to pay your part of the premium.  This is where the debate frolics in the ignorance of those it thrashes amongst.  As an exercise, go to any site online (I’ve used ehealthinsurance.com for the purpose here) and quote your current health insurance coverage over there and see how much it would cost you to insure yourself or your family out of your pocket today.

By way of example using my family of four, I selected a plan with a $2500 deductible and 0% coinsurance (a very generous plan) and the total for that policy came to $449.29 per month or $5391.48 per year.  The other policies ranged anywhere from $2380/yr up to a plan that cost $18696/yr.  Now, let’s recap: government cost to insure 4 people is AT A MINIMUM $9333 per year and me going out and buying a plan will cost me $5391.48 per year.

How is it, if the government plan is being proposed because insurance is too expensive, and the plan mandates legislation to control costs to ostensibly LOWER the cost of healthcare, that their plan costs more than a private plan does?

Or, to put it another way, why would the government want to create an enormous bureaucracy, threaten the foundation of fully 14% of our economy, put companies that employ hundreds of thousands of people out of business at a time when we’re suffering through the worst economy since the Great Depression…when they could simply hand the money out in large denomination bills and allow 100% freedom to buy as little or as much insurance as YOU want and save over HALF the projected cost doing so?

Why the hell should we spend more, get less and involve the government in a private industry where their only previous experience is the craptacular systems we have today called Medicare, Medicaid and VA medical care?  Have you ever actually BEEN in a VA hospital?  I have and I can tell you, the one I visited (more than once in fact) would have come in second place to my local veterinarian’s office were I given a choice to receive health care at one or the other.  Medicare was created in 1964 and less than 50 years later it will be bankrupt.  Wait times to see a doctor under Medicaid are outrageously long.  This is the federal government’s track record when they run health care and some people think this is what we all should get?

But wait!  The hits don’t stop coming!  Guess what…that $1.05T dollar figure…that considers that once the plan is in place, Medicare and Medicaid recipients will be moved into it and those programs discontinued.  The savings contemplated from closing out those two programs have ALREADY BEEN CALCULATED IN and the plan will STILL cost $105B per year more than it does now.

But why stop there?  Let’s toss in the completely irrelevant fact that if the plan is passed into law, the president, members of Congress and their respective families will NOT be forced to participate in this plan.  Nope!  They get to keep the superior coverage they enjoy now while you and I get to deal with the unholy amalgam of Medicaid efficiency, Medicare solvency and VA quality of care…and we get to pay even more for it than we do today whilst swelling the ranks of the unemployed when every health insurer in the country is closed in favor of this utopian notion of universal healthcare.

Ladies and gentlemen…if all the above didn’t give you reason to go rushing for the bottle of Tums…this is merely Part 1 of a 2 part post on this idiocy.  Stay tuned next time for Part 2 where we’ll explore who actually gets to pay for this boondoggle.  The message this post hopes to deliver is: no matter where you stand on the political spectrum this plan will have enormous and lasting effects on the American economy (and by direct extension, the economies of the rest of the world) and it SHOULD NOT BE RUSHED THROUGH CONGRESS FOR NO OTHER REASON THAN MEETING AN ARBITRARY DEADLINE.

My name is Euroranger and I approved this message.


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