Friday, October 19 , 2018, 12:19 am | Fair 56º

 
 
 

Harris Sherline: The Health Care Dilemma, Part I

Statistics are being misused in an attempt to justify the need for a government-run health care program

Leading the effort to sell his health care plan to the nation, President Obama has been appearing almost nonstop in nearly any venue that will have him. There is growing opposition to his proposal, as the details come to light. But he presses on, convinced of his own infallible judgment, that he knows what’s best for the nation of 300 million-plus people and that only his ideas can possibly solve the problem.

Harris Sherline
Harris Sherline

Economist Walter Williams said, “I doubt whether there are many Americans who think Congress has either the right or competency to choose where they live, what clothes they wear or what cars they drive. Yet many Americans stand ready to allow Congress to decide what doctors they can use and what treatments they receive. We forget that once we have government-sponsored health care, it can be used to justify almost any restraint on liberty.”

Columnist David Harsanyi commented, “The president claims that we must pass a government-run health insurance program — possibly the most wide-ranging and intricate government undertaking in decades — yesterday or a ‘ticking time bomb’ will explode. If all this terrifying talk sounds familiar, it might be because the president applies the same fear-infused vocabulary to nearly all his hard-to-defend policy positions. You’ll remember the stimulus plan had to be passed without a second’s delay or we would see 8.7 percent unemployment. We’re almost at 10.”

If the government is so efficient and capable of running large organizations, how is it that the post office and the railroads have never been able to operate at break even, let alone make a profit? So, why would a gigantic health care system that accounts for an estimated 18 percent of the nation’s total economic output be able to do any better?

Medicare is held up as an example of a government-run health care system that covers a major portion of the population (about 13 percent), yet operates efficiently, with only about 3 percent administrative overhead, while providing almost unlimited care to seniors at a reasonable cost. Unfortunately, the reality is not quite as advertised.

For one thing, Medicare loses money. It is one of the nation’s biggest unfunded liabilities. So, the program may be efficient, but it loses money. The Peter G. Peterson Foundation notes: “… between Medicare’s three programs (hospital insurance, outpatient and prescription drug), current and future promised Medicare benefits amounted to $36.3 trillion.”

Another little-known fact about Medicare is that the program is able to control costs only because it can dictate the prices it pays for services. In other words, the system employs price controls to keep costs down. However, it is historically well documented, dating as far back as the early Romans (Diocetianus, 244-301 A.D.), that price controls don’t work. For example, hospital fees for both inpatient and outpatient services are determined by the government, in its sole discretion. Furthermore, prices are set according to a system established by Medicare, which then pays only 80 percent of the fees that it determines are or should be the proper charges. Still, Medicare loses money.

Another representation of the Obama administration and others who are pushing for national health coverage is that there are 47 million Americans who do not have any health insurance, which provides the basis for their haste to adopt a plan. Once again, however, at best this is simply inaccurate; at worst, it’s a gross misrepresentation.

FactCheck.org offers the following information:

“Twenty-six percent of the uninsured are eligible for some form of public coverage but do not make use of it … this is sometimes, but not always, a matter of choice.”

“Twenty percent of the uninsured have family incomes of greater than $75,000 per year, according to the Census Bureau.”

“Forty percent of the uninsured are young … many young people lack insurance because it’s not available to them, and people who turn down available insurance tend to be in worse health, not better …”

Star Parker has written, “Pulling immigrants out of the equation, we’re left with an uninsured population that can’t afford insurance that is about a third the size of the widely quoted 47 million. It’s a population that is generally poor, young, uneducated and not working. … We’re already set up to deal with these folks. Either through Medicaid or covering their emergency room visits.”

As usual, statistics are being misused or misrepresented to support a position that is not necessarily valid — in this case, the need for a government-run health care program for everyone.

— Harris R. Sherline is a retired CPA and former chairman and CEO of Santa Ynez Valley Hospital who has lived in Santa Barbara County for more than 30 years. He stays active writing opinion columns and his blog, Opinionfest.com.

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