"We'll deny treatments, then pay you whenever" – the winning formula of government health care

On Friday, Mickey Kaus posted a scathing rebuke of the unbelievable strategy that the Obama White House and their accomplices in the press seem to be formulating in order to sell socialized medicine to the American public:

Democratic blogger Ezra Klein appears to be positioning Dem health care reforms as a way to cut costs, on the grounds that a reformed system will be able to make “hard choices” and “rational” coverage decisions, by which Klein seems to mean “not providing” treatments that are unproven or too expensive–when “a person’s life, or health, is not worth the price.” Matthew Yglesias’ recent post seems to be saying the same thing, though clarity isn’t its strong suit. (He must have left it on Journolist.)

Isn’t it an epic mistake to try to sell Democratic health care reform on this basis? Possible sales pitch: “Our plan will deny you unnecessary treatments!” Or maybe just “Republicans say ‘yes.’ Democrats say ‘no’!” Is that really why the middle class will sign on to a revolutionary multi-trillion dollar shift in spending–so the government can decide their life or health “is not worth the price”? I mean, how could it lose?

But then Kaus goes on to opine that this strategy is, in fact, misleading; Kaus supports government health care because he thinks the government will be less likely than for-profit insurers to deny treatment:

Take Arnold Kling’s example of a young patient with cancer, where “the best hope is a treatment that costs $100,000 and offers a chance of success of 1 in 200.” No “rational bureaucracy” would spend $20 million to save a life, Kling argues. I doubt any private insurance company is going to write a policy that spends $20 million to save a life. But I think the government–faced with demands from patient groups and disease lobbies and treatment providers and Oprah and run, ultimately, by politicians as terrified of being held responsible for denying treatment as they are quick to pander to the public’s sentimental bias toward life–is less likely to be “rational” than the private sector.

I think Kaus’ reasoning is completely backward. If you are treated unfairly by a private citizen or private business entity, you can petition the government to pass legislation that will prevent the situation from occurring again. You can also sue for restitution in civil court, yet another venue for redress that is provided by the government.

But if you are treated unfairly by the government, it’s a whole different ball game. Lawmakers and bureaucrats are extremely reluctant to take responsibility for mistakes or to blame colleagues when things go wrong. If you are wronged by the Bureau of Health (or whatever it will be called) then to which other government agency do you turn for help? Are government agencies really going to sue each other on behalf of an ordinary citizen? The thought of intra-agency lawsuits seems even more ridiculous. Even if lawsuits were successfully filed, the elephantine way that government bureaucracy moves would guarantee that very few people ever received justice.

Here’s the bottom line — we need to look no further than the aftermath of Hurricane Katrina, specifically the finger-pointing and utter abdication of responsibility by the Army Corps of Engineers, to see how the government reacts to large-scale bureaucratic failure. In my opinion, the government would respond aggressively to major problems within a nationalized health care system only if there were a lot of paper-pushers on bottom of the bureaucratic totem pole who could be routinely scalped without harming tenured government employees. Such a system is, of course, doomed to failure; ask the survivors of the Soviet military how their “vertical stroke” plan worked out.

And there’s another negative aspect that the cheerleaders for nationalized health care seem reluctant to talk about: the government is lousy at paying its bills.

Here in Oklahoma, the state employee health insurance plan, HealthChoice, is currently $80 to $100 million behind in claims processing and payments to health care providers.

Dr. Marc Siegel, a Fox News medical contributor, recently discussed this problem in the Wall Street Journal:

More and more of my fellow doctors are turning away Medicare patients because of the diminished reimbursements and the growing delay in payments. I’ve had several new Medicare patients come to my office in the last few months with multiple diseases and long lists of medications simply because their longtime provider — who they liked — abruptly stopped taking Medicare. One of the top mammographers in New York City works in my office building, but she no longer accepts Medicare and charges patients more than $300 cash for each procedure. I continue to send my elderly women patients downstairs for the test because she is so good, but no one is happy about paying.

The problem is even worse with Medicaid. A 2005 Community Tracking Physician survey showed that only 50% of physicians accept this insurance. I am now one of the ones who doesn’t take it. I realized a few years ago that it wasn’t worth the money to file the paperwork for the $25 or less that I received for an office visit. HMOs are problematic as well. Recent surveys from New York show a 10% yearly dropout rate from the state’s largest HMO, the Health Insurance Plan of New York (HIP), and a 14% drop-out rate from Health Net of New York, another big HMO.

Back in 1993, Bill and Hillary Clinton offered one possible solution to this problem — their proposed government take-over of health care criminalized any private practice of medicine outside the scope of the government program. Critics quickly seized upon the draconian nature of that rule and used it with great effectiveness in their campaign to defeat HillaryCare.
Most Americans wanted affordable health coverage, not a program that sent doctors to jail for visiting an elderly neighbor in their spare time, or renewing prescriptions for family members.

No one is denying that our current health care system is deficient. Right now, one of our most serious problems is the shortage of doctors — there are not enough primary care physicians for every American to have an annual physical examination, and not nearly enough specialists to pinpoint and treat all the ailments that would be discovered during those routine physicals: heart disease, high blood pressure, diabetes, digestive diseases, breathing disorders, sleep disorders, anxiety, depression, etc.

A massive government insurance program clogged with red tape and stingy with its payments is certain to drive away health care providers. When that happens, we will be worse off than we are now — only those who can afford to pay for treatment out of pocket will receive the best medical care, while the rest of us will be stuck waiting in line in overcrowded, understaffed public clinics. And if doctors are forced to assimilate their practices into the government system or face criminal penalties, then it is a no-brainer that the number of health care providers will shrink dramatically. After all, how many people will want to invest 15-20 years (honors high school – honors undergraduate – medical school – internship – residency) to become a slave of the state, overworked and pushed around by bureaucrats?

Whatever happens, it looks like the road ahead for health care in America will be a very rocky one indeed.

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