DrRich Explains Himself

Posted on September 2, 2009
Filed Under Healthcare Reform |

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Because some of his recent posts seem to have confused many of his readers (why is he so strongly against proposed healthcare reforms when he supports so many of its goals?), DrRich will state once again, for the record, his political philosophy.

DrRich is a classical liberal. This means he deeply values the concepts that guided America’s Founders; individual autonomy, property rights, freedom from restraint, free markets and limited government. He is deeply committed to the Great American Experiment, which is, to determine whether a nation conceived in personal liberty and dedicated to the proposition that all people are created equal can long endure.

He believes that healthcare is very, very important, and indeed, has dedicated his career and most of his life to healthcare. But it is not the most important thing. For our generation to abandon the Great American Experiment for the sake of healthcare, or anything else for that matter, would be a perfidious act against our posterity, and indeed a crime against humanity.

DrRich is in favor of healthcare reform, and is glad that serious efforts to reform healthcare are at last taking place. He even finds much to like in the proposed reforms now percolating through Congress, such as, provisions for health insurance to be made available to most, if not all, of the people who cannot afford it today; the provision for health insurance to be made available to all the people who are blocked from insurance today because of their underlying illnesses; and the provision to prevent insurance companies (if any continue to exist in their present form) from canceling policies of their subscribers who get sick. These are all very good things.

But, as regular readers will know, DrRich has recently strongly criticized these proposed reforms, and hopes they will fail. This has angered and confused some of his readers, who know that he has favored universal healthcare, comparative effectiveness research, and other aspects of the reform plan now before Congress.

DrRich has turned against this reform plan not so much because of what’s in the reform bill itself. As DrRich has pointed out, the actual words of the reform bill are entirely open-ended. This is why proponents of one view or another can find in the bill what they wish to see (death panels vs. no death panels, continued availability of private insurance vs. a poison pill for private insurance, etc.), and it’s why their arguments take on the cast of debates among Biblical scholars over the true meaning of some cryptic Old Testament passage.

Rather, DrRich’s objection to this healthcare reform is based on the context in which it is being advanced. And in recent months he has come to see the context as this: a broad dismantling (whether inadvertent or not) of the Great American Experiment.

This dismantling probably began earlier than the fall of 2008 when DrRich first noticed it. But last fall was when our Congress (the peoples’ representatives) first began the wholesale abandonment of their duties and of the Constitution, with their passage of TARP. TARP took $700 billion and presented it to the Secretary of the Treasury to spend as he saw fit, thus creating, arguably, the second most powerful government official in U.S., and certainly the most powerful unelected one, in a manner never conceived under our Constitution. This was followed by the government’s moves to begin consuming Fannie Mae, Freddy Mac, AIG, numerous banks and investment houses, and the auto manufacturers. And all of this was begun under a Republican administration.

While the Obama administration did not start any of this, they took the ball and ran with it, and to a degree that would have seemed impossible (to DrRich, at least) a year ago. They completed the acquisition of the car companies and other private and quasi-private institutions into the federal portfolio. They added yet another $800 or $900 billion onto the federal debt with the Stimulus Bill, and in the process our flaccid Congresspersons once again acceded to the idea that when the executive branch cries “crisis,” it is perfectly acceptable to pass a 1000+ page law into existence without even making a pretense of discovering what is in it.

Then there is the disturbing gathering of power by the executive branch. This includes commandeering control of the upcoming census by the White House, and just this past weekend, bringing the interrogation of foreign (and presumably domestic) terror suspects under White House control. (Under what circumstances do you suppose a Congressional Intelligence Committee would ever launch an investigation of the White House’s interrogation practices?) Perhaps more disturbingly are the 30+ unelected “czars” the President has named so far, individuals with potentially very big (but undefined) powers that at least threaten to impinge on the functions of Constitutionally legitimate government agencies and branches. These czars are not approved, or even vetted, by Congress (our representatives) - and at least some of them look to DrRich like very scary people, whose avowed political philosophies are collectivist, anti-capitalist, and dismissive of the Constitution.

So when the healthcare reform process began, yet again, with the presentation of a 1000+ page bill and the exhortation to pass it immediately - don’t bother reading it - on account of the dire crisis confronting our healthcare system, DrRich had seen enough. When that “pass-it-quick-it’s-an-emergency” strategy failed for once, and people began reading the monstrosity and reacting to it (as the Constitution provides that they may), and when in response our leaders accused them of being fascists, terrorists, mobsters, and other disturbing things, DrRich had seen enough. When DrRich read big parts of the reform bill himself, and realized that it is an intentionally ambiguous document whose effect will be to turn over the re-shaping of our entire healthcare system to appointed functionaries, czars, and other unelected bureaucrats,  DrRich had seen enough.

DrRich has never been a conspiracy buff. He has always believed that sustaining for any length of time a conspiracy any more extensive than, say, cheating at bridge, would be impossible. He has always considered the right-wing nut-jobs who think the opposition secretly wants to convert the United States to a Marxist utopia to be, well, nut-jobs. But if the governmental activities we’ve seen over the past six months are not a concerted effort to end, once and for all, the Great American Experiment, then they are at least an inadvertent effort to do so. DrRich wants this to stop.

Reforming healthcare is important, very important.  But reforming healthcare is not worth abandoning the foundational precepts of the most exceptional country the world has ever seen.

We can reform our healthcare system effectively and equitably, in a way that specifically preserves and strengthens those foundational American precepts. (DrRich has described how elsewhere.) At one time DrRich thought current reforms could possibly be turned into a first step in that direction. Now, thanks to the context in which these reform proposals are being advanced, he sees present efforts at healthcare reform as an irreversible step in the opposite direction, and possibly a final step from which we are unlikely to ever recover.

First we must decide what kind of society we are to be - and that’s the real “discussion” we’re having now - and then, and only then, can we decide how we are to reform our healthcare system.

And this is why DrRich will make his paltry efforts to try to stop it.

Comments

9 Responses to “DrRich Explains Himself”

  1. Praveen on September 2nd, 2009 2:20 pm

    Students of history will note that the current proposed intervention by the American government in the economy (via health care) are smaller than America’s historical interventions in the economy.

    Don’t believe me? See marginal tax rates at 90%, price controls, wage controls, suspension of habeus corpus, Glass-Steagal, etc.

    I think much of the current outcry is actually about the Reduction in entitlement, not the increase in it. Witness the fear of death panels and reduced benefits in Medicare. And yet that is an unstoppable reality: the federal government will cut Medicare benefits, because it cannot afford them.

    Dr. Rich, I have learned much from your writings, but I think you reach the wrong conclusion in your fears of further government intervention. The government already has pervasive control of health care in the US, and from what I’ve read (most of HR 3200) that will change only incrementally.

    If the government ever bans the right of private purchase of health care, I too will rise in protest. But what I see so far is a flawed attempt to modify the existing system. It doesn’t look great, and yet it’s better than what we have today. So I support the effort underway, even though I would much rather see:

    1. An elimination of the health care tax deduction

    2. Open rationing of Medicare and Medicaid, perhaps on the lines of CoverTN (a plan with a hard limit of 40k annual benefits) - http://www.covertn.gov/web/cover_tn.html , and the extension of something like this to all Americans

    3. Let the insurance industry to sell premium plans to all Americans, as in other countries, to extend the benefits provided by the very limited universal plan.

    4. Mandatory open pricing throughout the health care industry to foster competition, and to encourage Americans to directly pay their doctors once again.

  2. Red Baron on September 2nd, 2009 8:06 pm

    If government spending was 0% of the economy, this would represent a classic laissez-faire free market capitalist system. If government spending was 100% of the economy, this would represent communism.

    Today we are coming awfully close to that 50-50 mark.

    I don’t pretend to know what the right percentage is. Indeed I suspect a one does not exist as it entirely dependent on one’s personal moral and philosophical outlook, something that is at least partially genetically predetermined, if people like UVA’s professor Johnathan Haidt are to be believed.

    But to the extent it continue to increase, we all increasingly become prisoner’s of its leadership; perhaps we have no one to blame but ourselves.

    I have been reading Gore Vidal’s Inventing a Nation of late. In particular, Vidal shares the following quote from Ben Franklin:

    ” I am in favor of this Constitution, as flawed as it is, because we need good government and we need it fast. And this, properly enacted, will give us, for a space of years, such government.

    But then, Franklin said, it will fail, as all such constitutions have in the past, because of the essential corruption of the people. He pointed his finger at all the American people. And when the people become so corrupt, he said, we will find it is not a republic that they want but rather despotism — the only form of government suitable for such a people.”

    Red Baron’s comment: Hmmmmmmmm…..

    Sometimes it seems we have only ourselves to blame.

    Be well

  3. Praveen on September 2nd, 2009 8:29 pm

    Just one more quick comment - I think the notion of American “Exceptionalism” is a key part of the problem in the health care debate.

    Of the 33 highly developed nations in the world, 32 have already cracked this nut:

    http://truecostblog.com/2009/08/09/countries-with-universal-healthcare-by-date/

    Different nations use different solutions (some like Singapore are incredibly free-market) - but all of them have gotten there.

    We Americans are so caught up in how great we are that we don’t realize that there are literally dozens of templates to choose from - ranging from 100% socialist to nearly 100% free market.

  4. Kayla on September 2nd, 2009 9:50 pm

    I do agree with you DrRich. We do need to have a reform of some sort and the government is taking this way too far. Anyone remember Obama swearing that all healthcare debates will be open door? Yeah, that didn’t happen. And I agree with you, *I* want to *choose* what kind of coverage *I* want. My freedom of choice. I applaud you in your efforts to go against it.

    Praveen, I agree with you that the government is going to cut Medicare benefits, and it’s not right. Every U.S. citizen pays into Medicare their entire working lives as a Medicare tax is deducted from every paycheck. It doesn’t get any better as one reaches Medicare as they currently charge $96.54 a month for Medicare benefits, which currently do not cover everything as is and makes companies like AARP rich because one has to pay for secondary insurance. Unfortunately, the government treats Medicare as a free-for-all in dipping in to the funds to fund other projects and programs. CoverTN does seem like a great place to start. Take away networks and pre-existing conditions and add “Options” like specialist care and so forth and that could be an excellent way to start the reform. Place the care decisions in the Dr.’s and patient’s hands but within reason so a patient isn’t having unneccessary tests and treatments done. It can still work, they just need to scrap what they have and start over in the right direction.

  5. Red Baron on September 3rd, 2009 8:39 am

    Um Kayla, people using Medicare today HAVE NOT put as much into Medicare as they take out- It is a PONZI scheme- that is why we are in the mess we are in. Had they actually put into it the amount they use, all would be fine.

  6. Michael Kennedy MD on September 3rd, 2009 10:52 am

    A lot of the solution would be revoking just one provision of Medicare and most insurance plans. Medicare does not allow physicians to balance bill. That was the major error in Canada, as well. The ban on balance billing is an attempt to enforce egalitarianism but it has resulted in overt rationing when the alternative is simply to allow the doctor and patient to come to an agreement. France has gone a long way in this direction. What we are seeing now is a number of physicians dropping out of Medicare and going to a free market cash business. That is the retainer model.

    I also wonder how many of you have read this very astute piece in the Atlantic.

    http://www.theatlantic.com/doc/200909/health-care/

    That piece has many good observations although I disagree that the poor will be able to avail themselves of HSAs without subsidy. Still, it has excellent points and is being recommended by Obama supporters who probably haven’t read past the title.

  7. Kayla on September 3rd, 2009 9:11 pm

    Red Baron, I’ll do some math. Not to agree nor disagree with you, I’m learning as I type so let’s see how this works out.

    7.65% is taken out of every check for social security and medicare. As of 2007, the average yearly income per household was $50,233 (http://www.census.gov/Press-Release/www/releases/archives/income_wealth/012528.html) which breaks down to about $966.02 a week. 7.65% of $966.02 is about $73.90. Multiply that by 52 weeks and you get about $3,842.83 a year. Let’s say one starts working from the age of 18 until the average age of a person that goes on Medicare which is 65. That comes to 47 years of working. $3,842.83 multiplied by 47 comes to about $180,612.75. And once one does start drawing Medicare, one pays $1,156.80 a year just for Medicare Part B and $2,928-$5,316 for Medicare Part A (http://questions.medicare.gov/cgi-bin/medicare.cfg/php/enduser/std_adp.php?p_faqid=2100&p_created=1221840199&p_sid=ReGVO2Hj&p_accessibility=0&p_redirect=&p_lva=&p_sp=cF9zcmNoPTEmcF9zb3J0X2J5PSZwX2dyaWRzb3J0PSZwX3Jvd19jbnQ9NjY2LDY2NiZwX3Byb2RzPSZwX2NhdHM9JnBfcHY9JnBfY3Y9JnBfcGFnZT0x&p_li=&p_topview=1). For me, I see three different specialists that are about $250 each for each visit. Most people see a specialist about twice a year which comes to $1,500 a year. Hospital visits can cost around $10,000 and surgeries and such vary of course. If I saw all three specialists and had one hospital visit, I’d spend $11,500 a year which only costs $9,200 to Medicare since one has to pay 20% of all medical bills, which comes to $2,300. If I continued with that type of care until I was 100, I’d have spent only $322,000 out of the $323,580.75 minimum I put in to my Medicare. So how is there not enough money?

    Yes, I do know there are a lot of variables in that equation such as surgeries, perscriptions, actual number of times admitted into the hospital, as well as the variables of people that pass away or move out of the country before they ever touch all or part of the money they put into Medicare vs people like me that were put on it before their time because of disability. We could add the cost inflations over time and everything, but I hope I at least proved my point somewhat.

  8. Red Baron on September 7th, 2009 2:53 pm

    Kayla, Kudos for taking the time to do this exercise as it is more than most people ever do. I am impressed.

    As for an answer to your question why this analysis is wrong (actually it is not wrong, it is correct but it is incomplete):

    Fundamentally there are a couple of reasons your analysis is incomplete but the most significant reason you are way off is because you are applying what we call “linear logic” to a non-linear system.

    Which means the following: YOU ARE TREATING MOST PEOPLE AS EQUAL

    But you need to remember that health care consumption is very non-linear/non-equal: 1% of people consume 25% of health care dollars and 5% consume 50% in any given year. And while this flattens over an entire lifetime it is still very non-equal.

    This literally means that if you had a room with 20 medicare beneficiaries and the right person suddenly died, the other 19 people would spend only 50% of what they spent before.

    Your analysis is treating everyone the relatively similar when they are most decidedly not.

    And it is this extreme inequality in CONSUMPTION that leads to views on rationing as some people say “it is not fair” (especially when they are the ones contributing in the first place).

    fwiw, it is this issue that leads to a lot of fascist ideologies as well of which rationing can very definitely be a part.

    But there are other reasons why your analysis is incomplete such as the fact that only 55% of Americans are employed. And lots of people move on and off medicare tax rolls over the course of their lives.

    But remember, Medicare is for EVERYONE over 65 (not just those who paid into the system). This feature alone means you need to increase the annual outlays you calculated by 81% to cover the 45% of people who never did contribute to the Medicare pool.

    I hope this helps and again nice first approximation

    Regards

    Red

  9. Gary L on September 9th, 2009 7:30 pm

    Well said, and very erudite…It certainly makes one think that the changes and reforms proposed by the present administration ignore our basic and fundamental values. By offering more, we get less. It seems prudent to step back and wait until the dust settles from TARP, Stimulus,GM fiasco, bank bailouts…
    It seems purposeful to create chaos to distract from what is really occuring to our country.

    We will see what our President has to say tonite in one hour.

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