The Health Care Disaster and the Miseries of Blue
Published on: March 29, 2012
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  • Chase

    Instead of Obama care, why don’t we do what Nixon wanted to do. The government would just give money to people to purchase private insurance. Under this approach, the consumer would be able to select from multiple plans, which would compete with each other to attract business. This approach is easy to understand, and it wouldn’t have frightened as many people as the Obama bill.

  • Kolya

    I am left to wonder how many policy makers in the Democratic party could embrace reality and come to conclusions similar to yours without some cataclysmic event to force the issue. It will probably take a financial crisis to do it.

  • ari

    Good post. What about reforming the system, applying universal coverage but within the existing private market system? Israel has a system whereby semi-private companies compete for clients, but basic coverage is guaranteed for all.

  • Jordan

    I’d like to be able to buy health insurance for policy coverage that suits me from a company that operates wherever it wishes in the US. Kind of like how I keep 529 money in a state 2000 miles away because I liked its low fees and accessible website. It’s my personal choice for what’s best for my family. It’s called liberty. It’s what the USA is about.

  • Kenny

    Your general assessment is correct: Obama-care is a 20th Century construct that does not fit the 21st Century America.

    And by the way, regarding Head Start which you said: “It [Obama Care] isn’t like Head Start, which remains dearly beloved even though there doesn’t seem to be much evidence that it helps anybody other than the people it employs.

    Only the ghetto ‘loves’ Head Start. Normal people who have to pay for this waste hate it.

  • Joe

    Paragraph 13: “full of lobby lollipops and sweetheart* deals.” (maybe sweet heart, not sweat heart). Please delete this when fixed.

  • mac

    Get rid of EMTALA and refuse to provide care to anyone who can’t prove citizenship. That would ease pressure on the system immediately and give us some breathing room to start with.

  • Marty

    There’s a lot of people assuming ObamaCare will be overturned, based on how oral arguments went. Don’t be so sure. The 4 liberals will hang together and vote to uphold it because that’s what liberals do–stick together and support each other regardless of facts or lgic, in support of the “greater good” of their long-term statist project.

    So it still comes down to a solid 4-vote bloc with the other 5 spread across a range of opinions and concerns. That’s not a recipe for a sure thing. we’ll see.

  • Ken

    The unnecessary complexities in the US healthcare system are entirely driven by the payment system, and the payment system is 99.7% a government creation via Medicare, Medicaid, and the tax code.

    It is no surprise that the government’s “fix” would be another bloated, incoherent monstrosity.

  • CatoRenasci

    It all comes down to the same problem of complexity that von Hayek and von Mises showed made socialist central planning impossible in the 1930s.

    I remember in the ’60s and early ’60s when some people (Leontief, etc.) thought computers would make huge input-output central planning models possible (I think I still have a copy of Leontief’s Input-Output Economics (1966) lurking about on a rarely visited shelf). Didn’t work – the world was too complex then, and is even more complex (though considerably less robust if you believe Nassim Taleb) today.

    Although it’s adherents would have you believe compassion is the driving force of the Blue Model, it has always seemed to me that the real driving force is hubris combined with a lust for power. Doing well by doing good, in Tom Lehrer’s felicitous phrase.

  • ahem

    Why do you call it the blue model? It’s the “red” model and has been since Rousseau and, later, Marx. So-called Progressivism is nothing other than re-branded Marxism. Most Americans hate Marxism.

    The Left’s policies have been failing for the same reason they are failing in Europe–because the are, at heart, oppressive and coercive. Not to mention unrealistic.

  • Mark

    Like mac says, end the mandatory treatment of anyone who walks through an emergency room door, and then those hospitals cannot cost shift the expense of that onto the rest of us who pay for it via higher prices.
    We have the best care in the world, the problem is who gets stuck with the bill. Increasingly, it is the tax payer, and that has to stop, as it is financially unsustainable, and at it’s core government enabled theft.

  • Jeff

    Free market principles can never work properly. There is too much of an information/urgency mismatch between the buyer and the seller.

    The contrast between an industry where free market principles do work (computers and software) and an industry where they don’t (health care) is like night and day.

    In order for free market principles to work in health care, buyers (i.e., patients) would need to obtain services through an agent (a “medical buddy”) whose incentives were aligned with the patient’s interests and who had expert knowledge of the quality of all services available in the marketplace and their prices.

  • ” for various hard to decipher reasons, costs internal to the system keep rising faster than the rate of inflation.”

    I’m not sure they are hard to decipher. The best way to think of it is to compare where you set your thermostat at home vs where you set it in the motel room on vacation at the beach.

    Since you know you have to pay the electricity bill every month, you tend to be very aware of your thermostat setting and very conservative.

    In the motel, even though you may have a vague notion that if everybody sets their thermostat at 65, the cost of your motel room will eventually go up, there is the definite realization that it won’t go up on this vacation.

    I.e. you think differently because you aren’t paying for it directly.

    Until people are paying more of their medical costs directly, there won’t be any downward pressure on the cost of medicine and they will continue their elevator ride up.

    P.S. Thank you so much for your in depth commentaries. I look forward to reading your site every day. You are one of the best thinkers out there currently. Thanks for sharing.

  • Jbird

    Regarding the inability of some to afford health insurance, the federal government should get out of the charity business. Local, private-sector charity can be more efficient, discerning, and build community.

  • Mark Noonan

    You miss the obvious – the reason this “blue model” is failing is because the very concept that government can provide sustainable benefits is absurd. The only reason it “worked” from the 30’s until the 90’s is because there was enough surplus wealth-creation capacity pre-“blue model” to sustain a welfare State, for a while. But the “blue model” inherently kills the goose that lays the golden eggs. The goose is dead – plucked, cooked and 90% eaten. If it hadn’t been ObamaCare crashing down, it would have been the “successful” Social Security or Medicare doing it. If ObamaCare is killed our problem remains the same – the “blue model” is something only the most foolish can possibly believe in and unless we get rid of it, we’re financially doomed.

  • What’s a “sweat heart deal”? Sounds icky.


  • tom beebe st louis

    Perhaps the federal system can rescue health care, and thereby demonstrate its (States) effectiveness. Start with state-owned and operated Urgent Care centers to relieve the burden of the uninsured on hospital ERs. Simple and affordable, something so painfully lacking in the Obamacare abortion. Fifty legislatures, each listening to their constiuents, can address those aspects of health care that government should. Even this modest proposal would gain the attention of the electorate and eliminate the all-or-nothing myth that Washington would promote to justify its power grab.

  • Gringo

    #11 ahem
    Why do you call it the blue model? It’s the “red” model and has been since Rousseau and, later, Marx.

    Because convention in the US over the last 10 years or so has been to label Republicans as red and Democrats as blue. IIRC, it came about because of some coloring on a US map that a TV network had during election coverage.

    You are correct that the blue-red dichotomy as currently used in US politics doesn’t fit the standard definition of red in politics.

  • Andy Freeman

    > There is too much of an information/urgency mismatch between the buyer and the seller.

    Urgency? Few medical problems are both urgent and complex. The urgent problems tend to be “I’ve been in a car wreck” – there aren’t a lot of decisions to be made in that situation.

    The vast majority of medical care is like dental and optical care – it is scheduled.

    And, every HR department in the US will tell you that folks care about their out-of-pocket costs. (Why do you think that flex spending plans are so popular.) They make tradeoffs.

    In other words, what little market we have works and we could easily have more.

    Healthcare is not a special snowflake, any more than your kid is. There are no special snowflakes….

  • Bonfire of the Idiocies

    “Smart government by smart people, using modern methods and the latest up to the minute research from carefully peer reviewed articles in well regarded social science journals can solve big social problems.”

    Great, idiocy by consensus.

  • j lindsey

    I continually wonder when the distinction between health “insurance” and health “care” will be illuminated in law.
    Insurance is protection for large/unsupportable events (e.g., heart attack, cancer). It is reactive.
    Health care is entirely different — it is the regular dispensing of exams, therapeutics and advice. It has a large preventive aspect.
    Obamacare (and the existing medical infrastructure) is trying to fit a square peg into a round hole.

  • David

    Why in the world do you use the term “blue”. As the President says, “Let’s be clear about this.”

    Those responsible aren’t blue, they are Democrats. And Democrats are not liberal, they are now Leftists. And Leftists may be more accurately described as neo-Marxists.

    Even the color “blue” was selected used for visual use and is intentionally misleading. Aren’t the Democrats better characterized as “Reds” based upon their actions. Of course they are, which is why the media intentionally adopted the color blue. Blue better confuses the understanding and misrepresents their collective record. Does it not?

    The healtcare legislation was known to be bad when written, know to be bad when passed, and now as implemented, is know to be awful. The full weight of it’s destructive impact on our economy has yet to been fully realized. What is unknown is how destructive.

    It is not unreasonable to infer that it was passed to intentionally harm our economy.

  • Wilbur Post

    I agree with your assessment. Not only healthcare, but many other systems in our society have gotten much more complex. The public is much harder to manipulate than it was a century ago. Part of the reason is that many of us now UNDERSTAND how we are being influenced and why, and attempt to counter and/or game the system. In the same way, it’s much easier to give a kid a vaccination if you surprise him than if he sees you coming with the needle.

    A good analogy is automobiles – a century ago, they were reasonably simple. A moderately talented individual could understand the moving parts. Almost anyone could potentially fix one. Today, many of their workings are computerized and trained mechanics with equipment costing thousands of dollars CAN’T fix them.

    In short, it was obscenely arrogant for clueless politicians who can’t balance their own checkbooks to believe they could “fix” the healthcare system.

  • Nan231

    Why don’t we like Obamacare? Its very simple, we trust ourselves more than we trust the government.

  • BillH

    My take away: Do all we can to complicate every system to the point the nannycrats can’t control it.

  • Joe

    To paraphrase, never attribute to that which can be explained by incompetence.

    Our government is not run by the best and brightest, but people who talk a good line, but aren’t much qualified to do much else. They are the know-it-alls everyone loathes in companies; the people who sit in meetings and make grand pronouncements, but never actually do anything. They tend to pass laws in a knee jerk reaction to the whiny demands of outspoken idiots.

  • Joe

    (Previous post got changed.)

    To paraphrase, never attribute to [blank] that which can be explained by incompetence.

    Our government is not run by the best and brightest, but people who talk a good line, but aren’t much qualified to do much else. They are the know-it-alls everyone loathes in companies; the people who sit in meetings and make grand pronouncements, but never actually do anything. Congress tends to pass laws in a knee jerk reaction to the whiny demands of outspoken idiots.

  • Anthony

    “This is a horrible piece of legislation…The question is why…a sloppy mess that nobody understands and few admire….and once the system is politicized (as health delivery already is), the lobby groups (unions, hospital companies, insurance companies, professional groups, and many others) will make reform and adjustments impossibly hard.” WRM, as we know health care in America is a robust and growing entity of immense size, scale, and scope – with soaring health care costs.

    Now given interlocking feedback loops and system complexity, how can America deliver sustainable health care to its populace without fiscal implosion (from a pure business perspective health care providers are almost all economic successes – winners not economic losers)? Also, country needs serious discussion on contextual quality of health care in America (private good or public good) and not presidential campaign belaboring Obamacare/Romneycare.

    U.S. health care delivery generally will not reform itself and tying it to blue roots and Obamacare perhaps obfuscates the huge costs endemic to health care infrastructure – i.e. the reimbursement system creates incentives to maximize costs.

  • Red Nurse

    Mac! You are SO right! I an a RN in a level 1 trauma center ICU. You would simply not believe what comes to me on a regular basis from the Emergency Room. By declining those who are illegal, and also those who are frequent “suicide attempts” (swallow a bottle of whatever is handy, then call 911), I think we would see a lot less of both in our ER’s and in society as well. This, and trying to keep 95 year old Granny alive when to do so makes her miserable are KILLING our hospitals.

  • Jeffersonian

    Professor Mead’s central error here is that he assumes the intent was to get the Obamacare legislation right. It wasn’t. The flaws in it are features, not bugs, that work in favor of the True Believers in nationalized healthcare.

    First, many of the provisions of the law will drive insurance companies into bankruptcy, thus leaving the insured exposed and subject to predation by the Central State, who will be more than happy to absorb them into its exit-free embrace.

    Second, the flaws themselves present myriad opportunities to “fix” or “fine-tune” the scheme, a labor that will be, for all practical purposes, endless. The campaign ads practically write themselves: Who do you trust to fix healthcare, me or that iniquitous Republican, who doesn’t even think we should have implemented this precious guardian of The People’s Health?

    The fact that it works like a $2 watch will be turned into an asset, not a liability, for the Blues.

  • Red Nurse

    Argh. IS killing. I hate poor grammar.

  • Paul A’Barge

    Why? Because they’re Democrats.

    Look, let’s face it. Democrats are not exactly the sharpest knife in the knife block. Don’t we have a trail of tears we can follow where every step of the way, these people consistently make the worst choice?

    They make bad decisions because they’re Democrats. They’re Democrats because they’re stupid. They’re stupid because they think poorly.

  • ahem

    Free market principles can never work properly. There is too much of an information/urgency mismatch between the buyer and the seller.

    That’s utterly absurd. Only free market principles work efficiently because no one knows that precise needs of the individual better than the individual himself. I dare say that any time you’ve purchased a car it was after a thorough evaluation of all the available alternatives. It was an investment made after a great deal of thought and with due consideration of all the trade-offs. You didn’t give the dealer money at the point of a gun and were probably pretty well pleased after the smoke cleared. If you got a lemon, you had recourse to consumer protection laws. You want the government telling you which car you should buy?

    A committee of humans can never know all the considerations that go into an individual economic transaction. They can never possess enough knowledge to do anything more than legislate in large, inefficient brush strokes that please no one and possibly hurt some.

    You need to read “I, Pencil” by Leonard E. Read. It’s very short, but it demonstrates perfectly the systemic harmony and efficiency that disparate interests can achieve if left to their own devices.

    Unfortunately, we don’t actually have a free market–haven’t since FDR–and all the distortions and failures of our so-called “health” system are the result of the bone-headed ignorance and hubris of government committees. You’re upset with a system that represents the failure of too much government oversight, with a system that is the result of the position you currently advocate. Even more central planning is not going to improve matters. It will also have to side effect of reducing your personal freedom and enabling your servitude to the state. Do you really want to throw away the work of centuries for the sake of some third-rate health care that comes at the expense of the Bill of Rights and the Constitution?

    Come on.

  • Susan

    A retired doctor recently noted to me that the plastic surgery industry (specifically cosmetic surgery) is a medical industry which is not funded by tax-dollars yet it is a medical industry which not only thrives and is innovative, it is an industry in which the cost of cosmetic surgery is deceasing. Same with the veterinarian industry.

    Taking into account these two examples of affordable, accessible,innovative medical care which are not reliant upon tax-dollars it is fair to say that blue-modeled government programs providng health care is responsible for the unaffordable, inaccessible, uninventive health care we experience today.

    If it were not for decades of intrusive government interference into the free-market health care market imagine how affordable, accessible and innovative would be health care.

  • Mark

    The Blue Model (call it socialism, fascism, statism — what you will) only can appear successful in its earliest stages when the impact on an otherwise functioning economy is slight. To the extent that it grows it encounters the “information problem” that Hayek made much of and what you refer to as complexity and the related “calculation problem.” The free market is a huge calculation engine generating from moment to moment societal valuations for all goods and services; and it is these valuations that provide the basis or rational economic decision-making. To the extent that markets are free, competitive and efficient, the economy thrives. As the Blue Model encroaches upon and errodes this process it begins to corrupt the very data it needs to make the oh-so-scientific decisions its proponents brag of. Let’s set asside for the moment the additional problem of the graft and corruption endemic in the interaction of the economy with complex law and regulation. Even a Blue Model run by saints and geniuses is doomed to failure. The entire project is fundamentally irrational — however rational its individual actor may be.

  • Noah

    If the SSA is simple compared to administering Obamacare, hold on to your wallets. The SSA is $11B for $45M recipients of $250 per recipient which is kind of expensive for the great majority of us whose only interaction is 12 electronic transfers and 2 letters a year.

  • VA Teacher

    There are a couple of big problems with the way we have been doing this.

    1) Lumping everything together and calling it “health care” masks a huge amount of complexity. What is “health care”? Emergency appendectomy? Definitely. Liver transplant with a 10% chance of success? Viagra? Gender reassignment? Birth control? Yoga? Experimental cancer treatment? Nicotine replacement? The list is endless.

    Politicians like to leave the definition vague so that people can imagine that they will get everything they want and nothing that they don’t, but reality doesn’t work like that.

    2) We are way too wedded to the idea that “somebody else” should pay. While a case can be made for some people to be subsidized, no system can subsidize everybody… especially if you want to include things that everyone is definitely going to use, like cancer screenings and preventative care.

    I still think we should have a robust, state-administered program (like Medicaid) which pays for BASIC health care for the poor. We could probably save money by running that mostly through clinics that make efficient use of nurse practitioners, etc and are open during hours that accommodate people who work for a living. That system should be funded from general revenues through the ordinary appropriation process…figure out what we can afford and the most efficient way to provide it and there you go.

    Everyone else should be in the market. Buy insurance if you like that covers what you want, or pay fee for service, or join an HMO, or whatever. Regulation should be limited to making sure that contracts are fair, consent is informed and agreements are enforced. Innovation and competition should be encouraged. While it is true that you can’t shop around while you are having a heart attack or bleeding out, there are a lot of services under the rubric of “health care” that are not those kind of catastrophic emergencies.

  • David Davenport

    I still think we should have a robust, state-administered program (like Medicaid) which pays for BASIC health care for the poor.

    But “BASIC health care” is continually re-defined upward.

    An most poor Americans are people of color. What do you propose to do about disparate impact lawsuits?

  • Percy Dovetonsils

    All the reading I’ve done indicates that LASIK surgery has actually decreased in price. Why? It’s a cash business.

    High deductible plans, allowing plans to compete across state lines, limiting mandated conditions for coverage, separating insurance from employment, equivalent tax treatment whether you’re self-insured or get it through work; there’s a number of things that can be done now.

    However – lots of discussion about managing demand, but no one EVER talks about supply – do we have enough doctors and nurses now and in training?

  • John Alsina

    Yes, complex systems are profoundly different from simple ones. There is a potential gold mine of fruitful analysis behind this simple observation.

    There is a large body of scientific knowledge regarding complex systems. To design, build, and operate systems like computers, networks, and aircraft requires special techniques to achieve precise control of each system element. Originally developed by engineers, these techniques are now being applied with spectacular results in other fields such as medicine.

    These successes have led to a widespread assumption that systems such as the US healthcare market can be successfully managed using engineering techniques. However, this is untrue in any country whose citizens love liberty: by definition, people who love liberty cannot be controlled beyond a certain point, and systems with many uncontrolled elements cannot be successfully managed with techniques that require precise control.

    This confirms WRM’s thesis that political interventions in economic systems must be kept simple. There is a corollary: we must be satisfied with crude results. The quest for great precision in terms of social justice or economic efficiency is futile, and always leads to loss of liberty.

  • I’ll just link back to what I said, here.

    Engaging 300 million problem-solvers vs. a few allegedly Best and Brightest … that is the fundamental question here.

  • David Davenport

    Another question for free free free marketers:

    Most dental care is non-emergency, scheduled healthcare. Furthermore, much dental care is pay-as-you-go service.

    So why do dentists’ prices keep going up? Is this simply a matter of inflation and dollar devaluation?

  • Mkelley

    If the Democrats’ holy grail of fully socialized medicine was to work for even a while, it would have to have been done years ago before all the money was gone:

  • Mr. G

    Another point about the failure is that it points out the Democrats have nothing to offer the young. They are the targets of the input and have very little to gain from the output. This has been a feature of the Blue model from the start and is evident in Social Security, etc.

    OWS young support Democrats nominally but in reality they support complete and total redistribution with themselves as chief benefactor. Again, there is little there that is really about effectively representing a constituency and is about finding a demographic to fleece.

  • CatoRenasci

    I wonder if the use of “red” and “blue” doesn’t go back historically to the convention in American military map-making to show American (or Northern) forces in blue (the traditional color of the US Army from the Revolution through the end of the 19th century) and their opponents in red (the traditional color of our foes in the Revolution and the War of 1812, the British).

  • Robert Arvanitis

    Please do not hold up social security as a paradigm of “blue competence.”
    It is a particularly clever and vicious ploy, a complex scheme to continue the liberal ploy of “tax Peter to pay Paul,” long after Peter has unmasked the simple version.
    Ten people, one poor. The right answer is to take 10¢ from each of the nine, and give 90¢ to the poor one. Instead, FDR took $1 from each of the nine, then “gave” everyone 90¢.
    This has many bad effects.
    First it hides the net transfer. No one recognizes that they lose a dollar but only get 90¢.
    Second, it fosters the illusion that government can actually give you something. “Here’s my government check…” But government produces nothing; it’s merely a transfer.
    Third, this destroys values of thrift and hard work. The grasshopper collects from the ant.
    Fourth, it gives politicos 10 times the money for them to misdirect. They get to decide who needs more, who deserves less, whom they subsidize, which contractors to hire…
    Fifth, until now, FICA taxes were more than benefits, so politicians just “borrowed” the money for their own purpose. There was no investing of surplus.
    Take heed of this. Social Security has NO MONEY, just special IOUs from Treasury.
    Why do I say “until now?” Because starting next year, Social Security taxes will not be enough to pay benefits. Treasury will have to start replacing those special IOUs.
    Aren’t those IOUs good? Only if Treasury can replace those IOUs with real borrowing from real lenders elsewhere. Otherwise taxes go up and benefits get cut.
    By the way, when politicians talk about our national debt, they lie and do not include the special IOUs. But that’s a debt just like any other borrowing.

  • Jacksonian Libertarian

    High Deductible Health Insurance and Tax Free Heath Savings Accounts

    Only by engaging the Feedback of Competition which forces continuous improvements in Quality, Service, and Price in the Capitalist System, can the Healthcare system be made to work.

    Example: Patient paid for Lasik eye surgery, which developed from Radial Keratotomy eye surgery a few years ago, and has now dropped in price to a few hundred dollars per eye, or about the cost of a high end pair of prescription eye glasses a designer frame.

    Only when doctors, hospitals, and clinics are advertising their services and prices like Lasik surgeons, will we know that we have the best Healthcare the Feedback of Competition can provide.

  • thomass

    Your points very much remind me of their handling of green energy and high speed rail. Their argument/s about their right lead tends to come from their notion that their social planning skills are superior to other options (re: and I guess this flows in large part from their self proclaimed superior intellects). But the truth is; when you give these people power to do things they fall very very flat. I’ll say it; I’m just an idiot red state voter in their minds but I could have done better writing a health care reform bill.

  • JM Hanes

    j lindsey:

    “I continually wonder when the distinction between health ‘insurance’ and health ‘care’ will be illuminated in law.”

    Not anytime soon, because in the case of Obamacare, the conflation is deliberate. If you track the President’s “messaging,” you’ll find that he started out talking about the expansion of healthcare, and then, in a rhetorical pivot almost as distinct as the shift from “jobs created” to “jobs created or saved,” he was suddenly, and carefully, talking about insurance reform.

    While the country was clearly not ready to swallow a universal healthcare system cut from whole cloth, the prospect of “fixing” the existing system was far less alarming. Government was already in the business of regulating insurance, and the insurance industry made a ready Goliath. The battlefield was prepped accordingly, and here we are:

    The perfect political cover has (unexpectedly!) turned into the perfect legal storm so apparent in oral arguments before the Court this week. Where precision is the essence of good law, the shapeshifting terminology of risk management, cost shifting, health services, civic safety nets, responsibility and “markets” has made any cogent constitutional colloquy almost impossible. Both the questions posed by the Justices, and the Solicitor General’s responses were all over the semantic map, and I do not doubt that the resulting opinions will be too.

    Progressives (who never tire of deciphering coded right wing messages) have never so corrupted the terms of public debate as they have under this Administration. Subsidies are “investments,” federal incursion on the private sector is “partnership,” special interest groups are “stakeholders.” Insurance is currency in the healthcare marketplace.

  • uncleFred

    “Why, given a once in a lifetime chance to pass a program that Dems have longed to achieve ever since the New Deal, did they craft a sloppy mess that nobody understands and few admire, and then leave their law so unnecessarily vulnerable to constitutional challenge?”

    The simple answer is that the bill had far less to do with providing health insurance to people than it did with expanding the governments direct control over our lives. One of the major goals, perhaps the major goal, is to breach the last notion that the government is limited to a set of enumerated powers. Interpreting the commerce clause as allowing the government to compel individuals to enter contracts specified by the government with other individuals under criminal penalty makes government power limitless.

    2700 pages of legislation that extends far beyond any aspect of healthcare or health insurance, is not about providing medical services to the public, it is control.

    Do not view these people as stupid or incompetent, they knew exactly what their goal was and if this law stands they will achieve it.

  • Frank

    How many strict free market advocates out there have health insurance available through work but choose a different insurance company? If not, then you’re not functioning as a consumer in a free market system. You’re not the one selecting your insurance provider, your employer is. And yet this is overwhelmingly the reality of the health insurance market. The ‘consumer’ has no voice in choosing the provider. So not free market.
    Also, demand functions differently for medical care itself. When faced with a ‘have this procedue or you may die’ decision, very few people are going to have a serious internal debate about the cost/benefit ratio of having the procedure. For most people, health is more important than money. And since insurance policies usually restrict which doctors you can see, there’s no such thing as shopping around to find the cheapest doctor to perform your appendectomy.
    Medical care does not function as a free market system currently–even apart from the government sector. Perhaps one governmental program that could work is to mandate a differently structured, truly consumer oriented, medical insurance industry. Although I believe the only realistic ansswer is a universal, tax-supported single payer system, with limited coverage on a per annum and lifetime basis, but that also allows premium plans from private insurers for those that can afford them.

  • Jeff77450

    Mr. Meade, an especially interesting post today. Many thanx. I have my food-for-thought for today.

    I tip my hat, figuratively speaking, to Jeffersonian #31 and Susan #35 for making some very good points/observations.

  • brad

    good luck with creating opportunities for innovation and change in healthcare or anything else as it would force the collective to voluntarily relinquish power and control and is it messy; our betters can’t have any of that

  • Richard Treitel

    [email protected] does have a point. I’m not a doctor, so I don’t know and cannot easily find out whether the treatment my doctor recommends is (1) likely to cure me (2) likely to be cost-effective. I rely on my doctor to make these decisions in my interest, but s/he has his/her own interest as well. Under a fee-for-service system, it is not aligned with mine. tells more (read all 8 pages).

    This is quite different from buying a car, where I know roughly what a car should cost and can easily find out whether it is big enough, fast enough, etc. The car salesman doesn’t make these decisions for me! What’s harder for me to tell is whether the car is safe, and I don’t notice anyone trying to replace NHTSA crash tests with a pure market mechanism.

    The incentive to over-treat is the central problem of medical care (I won’t call it “health care”) in the US, and though I do favour markets over gov’ts, I’d welcome a gov’t system that removed that incentive. Obamacare leaves it in place.

  • Jbird

    My experience with High Deductible Health Plans (which I endorse) is that you can ask Dr’s and RN’s how much something will cost but most of the time they have no idea. That’s what’s wrong with Health Care. No one knows what anything actually costs.

  • Edward Sodaro MD

    Excellent analysis: well reasoned and insightful.

    Hence none of the blue guys will pay the slightest attention.

    With regard to Reply #1 from Chase, you are describing the kind of nice freedom of choice system that upper echelon federal bureaucrats and politicians give themselves.

  • Jbird

    #52 Frank: off and on I’ve had my employers insurance and I’ve bought insurance on the free market that was cheaper to me than what my employer was offering at the time. I found the process fairly painless. I would much prefer to see the extra money in my paycheck and be able to go get the insurance I choose for myself.

  • JM Hanes

    David Davenport:

    “An most poor Americans are people of color.”

    No matter how you define “people of color,” this is not the case. Poverty rates are much higher among Blacks and Hispanics than they are among Non-Hispanic Whites and Asians. In actual numbers, however, there are three times as many poor N-H Whites as there are poor Blacks, not as many poor Blacks as Hispanics, while the fewest poor are Asian.

  • Smack

    and, for various hard to decipher reasons, costs internal to the system keep rising faster than the rate of inflation.

    I might propose 2 reasons for the invariable rise in health care costs:

    1) Health care, unlike nearly all other markets, offers no economic ‘gap fillers’. Take, for instance, electronics. A new Sony widescreen with all the bells and whistles can cost upwards of $1000. It is high end, it is (generally) high quality and therefore commands the price point. However, that price point locks many, if not most, consumers out of the market. Product demand at the consumer end still exists despite ultimately being subsumed at the market end by the price point. Ergo, the proliferation of the $500 knock-off brand or last year’s model serving as a ‘gap-filler’ television with many (but not all) of the same features as the Sony, with a somewhat lesser quality than the Sony, sold at a price point that encourages market participation by a broader base of consumer…i.e. choice.

    This type of service discount does not exist in the healthcare field for various reasons, most notably the heavy hand of regulation (governmental and insurance based) and tort avoidance practices which ultimately yield a homogenization of acceptable treatment practices at a certain price point. There is no lesser standard of acceptable care to be offered at a lower (competing) price point. Ergo, there is no consumer choice and, ultimately, no true market competition to drive down prices.

    Dovetailing to my second point: the former would exist in the healthcare market but for the proliferation of non-catastrophic health insurance. Insurance is a guaranteed pot of revenue from which the hospitals and doctors draw for payment (at negotiated rates, of course). There is no consumer based market feedback relating to cost of services and necessity of services (ultimately, in the end, the same thing). This market failure is doubled when the insurance companies collect the bulk of their premiums from the government and/or employers instead of the ultimate consumer. We have multi-billion dollar companies making consumer based market cost decisions for people that have less than 1/10,000th of that amount of money as disposable income. With insurance being available for non-catastrophic healthcare needs, the healthcare system has become completely untethered from the fiscal realities of its consumers. The ONLY solution I see relating to the COST of healthcare is to eliminate insurance completely from the non-catastrophic healthcare market or imposing price controls (I vomited in my mouth a little writing that last part). If healthcare is to be affordable to the end consumer, the end consumer has to be the ultimate controller of cost: i.e. forgoing 6 x-rays ($600)and surgery ($5,000-$20,000) for a broken arm and getting one x-ray ($100) and a cast ($200) instead.

  • mark l.

    obamacare was a soup, without a recipe, featuring well over fifty chefs(special interests), who wandered through the kitchen and put in their own ingredients.

    the trailblazer in the matter is, of course, our tax law. in tax laws’ defense, someone got a chance to sample the soup as it was made, over a long period.

    I keep flashing back to jon stewart mocking herman cain for wanting laws to be confined to a page-the faith liberals have in their ability to throw out ‘war and peace’ is astounding.

  • Kevin Foster Keddie

    As an admirer of your work and of much of your recent writing, I have been struck by how your ideas might be enriched by a study of the science of complexity (or perhaps they already have).

    In this recent piece you talk of the complexity of health care and point to “simple systems” that do work. This is one of the essential wisdoms uncovered in complexity science. It sometimes referred to as the rule of intermediate forms. A complex system designed from scratch will never work and cannot be patched up to work. You have to start over with a simple system that works. There are many others.

    Complex social systems undergo rapid change and how these systems adapt to change follows certain patterns. Leaders of such systems can employ complexity science to facilitate the development of resilience – important for system adaptation – and survival.

    Leaders who do not understand how these systems adapt struggle – and more importantly – waste precious resources and inhibit the development of resilience.

  • Steve

    Preventative medicine is close enough to a free market: willing sellers/buyers, information widely/cheaply available, no monopoly/monopsony, etc. Emergent care clearly isn’t.

    I hate government programs, but I would grit my teeth and accept a tax for universal emergent/catastrophic care insurance. I bet the majority would too – if anything, just to get this painful process finished so businesses could have some visibility and start hiring people again.

    So why didn’t Obama simply propose this? If Obamacare could pass, clearly a more limited emergency/cat coverage plan could’ve. Because he wants total government control over the whole system.

    He would rather have a glorious failure than a limited success. His ego will not accept the “small caliber” solution. People remember who gave us SocSec. Who remembers the guy who gave us “Head Start”? Even if it worked, which it doesn’t, there is little glory in it.

    If and when this healthcare problem gets solved, it will have been solved by a series of small-caliber fixes authored by the faceless interaction of market forces.

  • The writing was on the wall for ObamaCare at least three years ago but Libs couldn’t read it because they’d grown so accustomed to inflicting their extremist blight on the rest of the U.S.

    They were so sure that they were going to sail through the Supreme Court that they didn’t even prepare for battle.

    Well they forgot that there is a Constitution even though Obama and his ilk wish there wasn’t.

    From a blog posted back in 2009.

    Can Congress Force People To Buy Health Insurance?

    The short answer is, “No it can’t!”.

    The Constitution assigns only limited, enumerated powers to Congress and none of them, including the power to regulate interstate commerce, or to impose taxes, would support a federal mandate forcing a person to buy health insurance.

    The Supreme Court has frequently interpreted Congress’s commerce power quite broadly, but this type of mandate could not undergo review without censure, regardless of the pressure exerted.

    The federal government simply does not have the power to regulate Americans in this way, and in two key cases, United States v. Lopez (1995) and United States v. Morrison (2000), the Supreme Court specifically rejected the proposition that the commerce clause allowed Congress to regulate non-economic activities simply because, through a chain of causal effects, they might have an economic impact.

  • P Sirusas

    How about congress outlawing the blatant price discrimination that occurs between insured and cash paying (or uninsured) customers? I think then more people would self insure or opt for higher deductible or higher copay plans and market forces from people shopping would go a long way towards reigning in rising costs. Maybe a max 10 or 20% discount allowed for insurance companies versus cash paying. I think a lot of uninsured people don’t pay their bills because they know they are getting charged multiples of what they should be or what others who are insured are getting charged.

  • thibaud

    In the wake of the collapse of this Rube Goldberg scheme to reform our Rube Goldberg health insurance system, a few core principles that a 70%+ majority should be able to support:

    1. Sever the link between employment and health insurance.

    2. Eliminate tax deductibility of health insurance costs.

    3. Enroll every American in a version of medicare to protect against medical catastrophes and to ensure that no one be denied coverage due to a pre-existing condition.

    4. Give every household a voucher for purchase of additional insurance. Vouchers would be calibrated to hte number of people in the household. Families with two parents and two children might receive $7k; singles would get $3k, for example.

    The above would be paid for out of increased government revenues. These would result when the US corporate sector, finally rid of the absurd monkey on the back of having to fund employees’ health insurance, finds itself able to hire millions more employees without incurring huge marginal costs.

    Without the burden of paying for health insurance and without the uncertainty about ever-higher and ever more onerous regulations, the Fortune 1000 would increase US-based employment by a million or more, overnight. Productivity and US-based profits would both rise: for every 10,000 employees, profits would go up by about $60 million, and taxes paid to the Treasury by about $20 million.

    That’s about $100 million in extra tax revenues from the Fortune 1000 companies _alone_. Not enough to fund the entire cost of medicare-for-all, but close to it.

    Yes, we can have universal access to reasonably adequate care. But we must first sever this insane and self-destructive link between one’s employment and one’s health insurance.

  • moderateGuy

    Well argued article as always; and Chase is absolutely right, what is needed (and in every Western country are individual health accounts, along with individual retirement accounts, where the government tops up the amount for people in need; and the market of millions of people shopping for best (for them) insurance plan drives innovation, they way it does in any other area, from cell phones and tablets to the much maligned now broccoli.

  • thibaud

    Correction to the above: “That’s about $100 *BILLION* in extra federal tax revenues from the Fortune 1000 companies _alone_.”

    Expanding medicare to all would cost us a few hundred billion extra. We can get there if we stop hamstringing our employers with health insurance obligations that they never should have been saddled with.

  • ANY discussion of the Blue model MUST include A) Those demanding the model
    B) The demographics of those demanding that model.

    It is a fallacy – unfortunately on into which Dr Mead has fallen via the sin of ommission – that the Left is reproducing to help pay for the demands they make on future wealth and lives.

    The Left is NOT populating the generations that will have to pay for this, or which will have to live in the poorer, less-free world these programs will create.


    Here’s a 3.5-min video with charts and explanations… but the Blues are NOT reproducing, period. The Red children are going to have to pay for this…

  • J. Ram Ray

    There’s a way out of the health care quagmire – it’s called a single payer system – Medicare for all. And Medicare has lower overhead costs than any healt insurance company, and Medicare has no marketing costs and no profits!
    Regardless, government needs to take a chainsaw to the current fee-for-service model – advanced procedures such as MRI or a triple bypass in other advanced countries cost 30-50% less, and the doctors in those countries still earn far beetter than most middle class wage earners!

  • “The public hates it”? The public doesn’t know what it is yet and neither does anyone else as far as I know.. In any case progressives or whatever you want to call them have been trying to get some form of national health insurance passed at least since the Truman administration, so I don’t see what not getting it done now has to do with any change in the blue atmosphere.

  • BTW, if Mead or whoever wrote this piece is against Obamacare what do they propose to put in its place? Keep in mind that all the other industrial democracies have national health insurance of some kind and it seems to work. At least they live as long as we do and spend half as much money on healthcare.

    Beating the drum against Obamacare and talking about incentives and state experiments and so forth just likes like nothing.

  • lawnboy

    “Yes, complex systems are profoundly different from simple ones. There is a potential gold mine of fruitful analysis behind this simple observation.

    There is a large body of scientific knowledge regarding complex systems. To design, build, and operate systems like computers, networks, and aircraft requires special techniques to achieve precise control of each system element. Originally developed by engineers, these techniques are now being applied with spectacular results in other fields such as medicine.

    These successes have led to a widespread assumption that systems such as the US healthcare market can be successfully managed using engineering techniques. However, this is untrue in any country whose citizens love liberty: by definition, people who love liberty cannot be controlled beyond a certain point, and systems with many uncontrolled elements cannot be successfully managed with techniques that require precise control.

    This confirms WRM’s thesis that political interventions in economic systems must be kept simple. There is a corollary: we must be satisfied with crude results. The quest for great precision in terms of social justice or economic efficiency is futile, and always leads to loss of liberty”

    This is the best comment of the day. It’s freakin awesome and I intend to palagarize it at every opportunity. Thanks in advance.

  • Amy

    Mr. Meade seems to be supposing that the “blue methods” were ever conceived or dominated by anything more than sloppy, wishful thinking. This law is just an extension of the other blue [stuff] that’s been foisted on this country.

  • I hear the Canadian health care system stinks. That doesn’t mean it really does of course. Ditto for France’s, Germany’s, etc..

    We currently spend over 15% of GDP on healthcare. Every penny of that is somebody’s income, and every one of those people is going to resist losing that income tooth and nail. This is what we are up against.

  • HobartStinson

    It will take a cataclysmic disaster in order for the progressive blue politicians and followers to snap out of their insanity. That cataclysm is called, “Obamacare” and we cannot allow it to drag the nation into poverty and disgrace.

    No government bureaucracy can regulate a complex system such as health care. The defining of a bureaucracy is that it is slow to detect, slow to react, and abysmally inefficient. That is what the Democrats created with this bill. It HAS to be repealed, for the sake of the nation, it HAS to be repealed.

  • We are also the lowest taxed industrial country in the world with the most unequal distribution of income — thanks to trade with China among other reasons. Maybe it’s time to tax those rich to insure everybody for something as basic as heathcare? If not, why not?

  • HobartStinson

    Want another example of an extremely complex system that cannot be understood?

    The Earth’s atmosphere and the climate we experience. This is a system that is thousands of times more complex than the U.S. healthcare industry.

    It’s a shame that the scientists who push for reductions in greenhouse gases are NOT being completely truthful because they are NOT admitting this HUGE fact to the public.

    No one group of scientists, no matter how complex their computer models are, can predict the cause and effects on the atmosphere on a planetary scale!!!

  • EBL
  • GlenB

    Good posts.

  • We are also the richest country by per capita GDP in the history of the world. Something [annoys me] about Mead’s or whoever wrote this article’s too-easy excuse for writing this piece of legislation off. Maybe it is a poor piece of legislation. I don’t know. But even if it is it might be a step in the right direction. Maybe it can be amended, reformed, improved, maybe it will help us get a lid on things — but no matter what something has to be done, and I don’t think the writer of this piece gives a whoot much.

  • EJM

    Well reasoned and well written (as usual), Prof. Mead. You lay out very well the vast impracticality and inherent corruption of a centralized approach to solving a problem like health care.

    There are a few points I would add and ask you to consider:

    1) The impracticality of controlling vast numbers of people and vaster numbers of individual decisions was made by F. A. Hayek and generally the Austrian school of economics nearly 70 years ago. Bastiat made essentially the same points in the 19th Century. As societies, markets and interrelationships become more complex, these criticisms of the central planning approach to try to manage decisions have only become more salient and inescapably obvious in the 21st Century.

    2) Nevertheless practicality does really interest today’s “progressives,” or rather only marginally. Time and time again when one tries to raise these points or discuss rational alternatives, one is confronted with a response like “But the present system isn’t fair!” Or “Insurance companies are profiting from the sick!” “Are you in favor of profits or people?” This effectively ends all discussion. I am convinced that in the aftermath of the denigration of traditional religion and without a some substitute framework for ethics, social justice or the proper goals and ends of public action, particularly among liberals, we cannot have a rational discussion of the means to get there. The arguments you or others make of the absurd impracticality of schemes like Obamacare will continue fall upon deaf ears, and you will only find your motives questioned.

    3) The virtue of individual freedom, so important to our nation’s founders and subsequent generations has been nearly expunged from elite intellectual discourse–along with the foundation of the Constitution itself. It was the preservation of individual liberty which was the principal goal of the limited government of checks and balances on federal power so carefully constructed by Madison. Look only at the Administration’s feeble defense of the PPACA befoe the Supreme Court this week or Nancy Pelosi’s incredulous response to a reporter asking about the constitutionality of the mandate in 2009 (“Are you serious? Are you serious?”) to see what the present day policy elites think of these limits on their power. The reaction to the Court proceedings this week by liberals is of shock that anyone has even heard of limits on federal power or the Constitution (many of them or their readers seem never to have) much less takes these limits seriously. By implication individual liberty is a value of no importance or even recognition as a value in their thinking. In addition to and apart from the impracticality of centrally imposed schemes, we need to revitalize our understanding of the ideals of limited government embodied in our founding documents, and the morally ennobling virtue of individual liberty over governmental mandates and coercion.

    Compassion is exercised from the heart voluntarily by free people, not codified by thousands of pages of regulations by federal bureuacrats.

    I would appreciate your comments on the moral and idealistic dimensions of the crisis of the blue social model, in addition to its practical limitations.

  • One of the things that makes national health insurance hard to pass is our fabled diversity. The rich don’t care to pay for other people’s health care needs for the simple reason that they don’t care about people not of their class or their color. Yet these are the same people who encouraged diversity to keep wages down. I think we should stick it to them, hold them responsible for what they have created.

    And what will be their response? If nothing else fan the flames of racial and ethnic division! Divide and conquer!

    The American people need to come together.

  • Bill Davenport

    “Most Americans hate Marxism.”

    Unfortunately, the Americans who like Marxism are the ones who are in charge (in charge of our schools, universities, unions, courts, bar associations, the television media, newspapers, the film industry, the arts, philanthropic foundations and all levels of government).

  • Next thing WRM’s bloggers will be opposed to social security. If they aren’t already. Let the poor and the old rot in the streets.

  • Rob H.

    This is a very open-minded article that confronts the limitations of big government and addresses one of liberalism’s most pervasive conceits: that they are smarter and more analytical than conservatives, and therefore create better policy. You seem to have discovered that there are limits to how well the government can do things, which you seem to see as sort a “above liberalism” view. In fact, recognizing that government isn’t always the best way to fix a problem isn’t above liberalism, it’s called “conservative.”

  • thibaud

    I think the discussion here, and nationally, would be much improved if both sides were to focus on Luke Lea’s points that our current Rube Goldberg system is bankrupting us and that medicare, for all its flaws, is an example of a government-provided insurance system that works well enough for those who receive it.

    Modest proposal: give every citizen a voucher for private insurance purchases + basic catastrophic coverage a la medicare.

    Eliminate tax deductibility, allow nationwide competition, pay for the increased costs out of the increased tax revenues that will occur with increased hiring and growth by the private sector.

    Forget the “blue” and red” labels. Why would this approach not be acceptable to over 70% of the public?

  • SinConfusion

    Im not US born or raised. I came as an adult, so I cant recite the amendments or the constitution as well as my kids do. I dont trust in indivuals smarts, but I do trust the American People wisdom as a whole.

    When I saw those initial protests in townhall and public meetings, then the birth of the TPers, then those elections in NJ & Va, then the passing of Ted Kennedy only to be replaced by a Republican who ran on the mantra of ’41’ in the bluest of blue states, and all of it topped by the 2010 “shellacking”, that’s all I needed to tell me that this mandatecare was wrong and unconstitutional. I didnt need to read all the pundits of left or right, I didnt need to see SCOTUS getting involved. The HCR law is [trash]! Dump it in its entirely. Even if good intended, the precedent it creates is by far worse and riskier than by not having.
    There are plenty other solutions to check, but only one freedom to have.

  • Dave H

    J. Ram Ray: “Medicare has lower overhead costs than any health insurance company, and Medicare has no marketing costs and no profits!”

    No, Medicare’s overhead (fixed) costs are only proportionally smaller than pvt. ins. cos. compared to their unfixed costs because Medicare’s unfixed costs are so huge (it’s required to cover all elderly medical expenses, while ins. cos. work in a mkt covering all age groups but not the entirety of any one of them). I.e., that fraction is smaller not because its numerator (fixed costs) is smaller, but because its demoninator (fixed + unfixed costs) is so much bigger than for pvt. ins. cos.

    “No marketing costs and profits” doesn’t mean lower prices (to the user, payer, gov’t, whoever is footing the bill). Anything that costs money to make or provide can be made or provided cheaper for profit in a competitive market, because the profit motive in a competitive market puts downward pressure on costs that is missing from gov’t programs.

    You think like a liberal, very simplisticly. The market is dynamic and complex. Simplistic solutions don’t work (did you read the column?)

  • Joe

    I guess those conservatives must have had a disaster of an idea. Who could even imagine Mitt Romney implementing it?

  • Andrew Allison

    Wow, WRM hit a lot of hot buttons with this, typically thoughtful, post. Might we perhaps try and get past the rhetoric and consider the facts?
    The issue here is socializing healthcare. It’s already the case for those qualified for Medicare/aid; the questions are how to pay for what’s already been committed and is what to do about the rest of the population.
    What we are faced with is a lack of funds, and in such a situation having the private insurance industry siphon off more than half the premium dollar (not to mention the 25% of healthcare provider revenue lost to insurance overhead is simply untenable.
    The answer is inescapable: socialized (single-payer) and means-tested healthcare for all.

  • Susan

    Instead of national socialized (single-payer)system and government means-testing healthcare for all(one size does not fit all) why not empower the individual with opportunity to access their own private health accounts?

    Rather than living a life in which government pitts citizens against one another for access to government’s socialized (single-payer)healthcare why not establish a system in which insurance companies are competing against one another for our dollars? Imagine what the insurance industry would be like if it were allowed to operate like Apple and Microsoft, companies which complete against one another to provide the best product available at an affordable price?

    Why not inspire dignity and self worth in the individual rather than demoralizing individuals into a Collective whose destiny is determined by a monsterous bureaucracy?

  • Joe Seely

    Why did they pass this mess? Simple. It’s called the long game. They want private insurance rates to rise, so more people drop coverage. They want employers to dump employees into the exchanges and they want the number of uninsured to increase. They want these things so they demonize insurers some more, and next time conditions are right they will say, “see we tried to work with those insurers, but they keep jacking up rates and now we have 30 million uninsured.” Then, they will roll out single-payer. Obamacare is but a stepping stone.

  • Renfield

    @32 Red Nurse, who said, “Argh. IS killing. I hate poor grammar,” about her previous post:

    “This, and trying to keep 95-year-old Granny alive when to do so makes her miserable are KILLING our hospitals.”

    The problem is that your original sentence is punctuated incorrectly. Either a comma after “miserable” must be added or the comma before “and” must be removed.

    With the two commas, the subject is simply “this,” so the verb would be singular (is). Without the commas, the subject would be “this and trying,” so the verb would be plural (are).

    On other matters, Walter Mead’s key statement is: “[T]he question is whether the Supreme Court will kill it quickly and at a relatively low cost, or will it impose huge costs and inefficiencies across the country as its contradictions and inadequacies are successively revealed.”

    I have edited several studies of how physicians, pharmaceuticals, and hospitals are “preparing” for Obamacare. The short answer is, “Nobody knows what the h3ll is going to happen, and nobody knows what the h3ll to do.” I can say with certainty that President Obama’s idea that use of electronic health records will somehow save zillions of dollars is pure delusion.

    I have also edited several studies of Head Start conducted for the U.S. government. Head Start centers around the country operate with varied effectiveness, but while Head Start enrollees show initial benefit from the program, by age 15 or so all positive outcomes have vanished. Still, it’s everybody’s favorite program–not because it works, but because people merely assume it must work. (It does work well for the people who administer and study it, but not so well for the kids in it.)

  • Thucydides

    Red in politics is the colour of the Socialists; red in warfare is the colour of the enemy force.

    Draw your own conclusions as to why the Republicans are labeled “Red” by the legacy media

  • oldtimer

    They used to alternate the colors red and blue each presidential election, until 2000 when someone started talking about the red states as being where all the lynchings, etc. etc occurred. The media loved that and stopped switching back and forth.

  • BTW, if Mead or whoever wrote this piece is against Obamacare what do they propose to put in its place?

    Not what … a LOT of varying “what’s” that better meet the needs of the individual.

    Asking “what”, as if there is one, grand, sweeping answer that fits all of us, is how we get into messes like this.

    Next thing WRM’s bloggers will be opposed to social security. If they aren’t already. Let the poor and the old rot in the streets.

    Social Darwinism is so 20th Century … as we have seen time and again, Americans will help out those in need, when they see the need as real … and when they have the resources to give to meet that need while remaining self-sufficient.

    Government intervention works against both of those enabling influences … it lacks the ability to reliably differentiate between the truly needy and the merely greedy, and it squanders the resources that could be given to the truly needy on doing things “its way”.

    There is no need for government to intervene, beyond its proper purview of enforcing the laws against fraud and injunctions against breach of contract. Our fundamental problem is not that there is no grand solution to the health-care problem … our fundamental problem is that we keep looking for others to whom we can outsource OUR responsibility, to ourselves and our neighbors, to solve our part of the problem.

  • Chico sajovic

    #60 smack – Best comment evah!

    Most needs/wants are either cheap, substitutible or can be forgone. Healthcare does not fit that description. What we as a society need to do is to decide what kind of care we want to provide to people who don’t have insurance or otherwise can’t afford medical care. A free market is not going to be able to provide much to the millions of uninsured americans with no savings.

    Currently the poor are provided care by government unfunded mandates. Maybe we already have the optimal system.

  • Yahzooman

    You want simple? How’s this for simple:

    1) Decouple health-care from your job. (As everyone knows, this little sleight of hand came out of FDR’s regime when employers couldn’t add to salary but could add benefits).

    2. If you can’t decouple, then at least make tax policy consistent. Individuals should be able to deduct the cost, just like employers do now.

    3. Make policies ala carte. If you want acupuncture coverage, OK. If not, OK. If you want massages, OK. If not, don’t sign up for it. If you want catastrophic coverage only with a $25,000 deductible, OK.

    Health insurance should be like car insurance and homeowner insurance. Can’t wait for the GEICO ads.

  • Gary L

    If only William Rehnquist were still with us – that Supreme Gilbert and Sullivan fan would have doubtless invoked “Lord Mountararat’s song from Iolanthe, an eloquent hymn to laissez-faire policies and political humility…..

    When Wellington thrashed Bonaparte,
    As every child can tell,
    The House of Peers, throughout the war,
    Did nothing in particular,
    And did it very well:
    Yet Britain set the world ablaze
    In good King George’s glorious days!

    And while the House of Peers withholds
    Its legislative hand,
    And noble statesmen do not itch
    To interfere with matters which
    They do not understand,
    As bright will shine Great Britain’s rays
    As in King George’s glorious days!

  • Brett

    @Ritchie the Riveter

    Social Darwinism is so 20th Century … as we have seen time and again, Americans will help out those in need, when they see the need as real … and when they have the resources to give to meet that need while remaining self-sufficient.

    I hear we had that in the early twentieth century. It [failed] to work so well that we ended up moving towards a more socialized system, along with everybody else in the Developed World.

    If you want to see what that type of charity buys, take a look at how much funding different charity disease prevention groups get – it’s all about popularity. AIDS gets tons, while less well-known diseases that kill easily as many get only a fraction of that funding.

    I’ll take the Canadian System (with its wait-times) or the German system (which doesn’t have them) over that any day.

  • johneb

    Everything about the 20th century blue model is a 21st century disaster: welfare, Medicare, Social Security, Head Start, EPA, NLRB, ag subsidies, minimum wage, blah, blah, blah, etc. Each was a disaster when it was implemented and it is a catastrophic disaster now. It was Marxist then and, like Obamacare, it is Marxist now. Maybe WRM will listen to the voices that have been there all along saying, “MARXISM DOES NOT WORK!!!” At least he realizes that the product of 21st century blue is fatal for society from the jump. He just might see it is the same thinking he was engaging in back in the day.

  • gjosh

    Just like Walter Russell Mead’s other recent articles about the so-called “blue model” (his term), this piece is rich with interesting ideas and theoretical models for thinking about our current political crisis–but also completely lacking in helpful suggestions for how to make anything better.

  • Dave Acklam

    The problem with supposed ‘health care reform’, is that all of our ‘solutions’ only MAKE THE PROBLEM WITH OUR HEALTH CARE COSTS WORSE!

    What is that problem?

    Individual people don’t pay for their own individual health care & health insurance.

    The thing driving the ever-increasing cost of care, is the system of health-insurance pooling – where your health care plan comes from your employer, all employees pay the same rate regardless of lifestyle & healthcare usage, and insurance is expected to cover ‘everything’ health-related from (essential) chemotherapy to (not essential) contraceptives, Viagra & baldness pills.

    It’s like everyone in your office having the same car-insurance rate (both the guy who’s never had a ticket, and the one who’s one DUI away from losing his license for life) & expecting their car insurance to cover everything down to oil changes.

    But we persist on increasing this very ‘pooling’ effect that is CAUSING THE PROBLEM… If only the pool were bigger… If only people got insurance from government ‘exchanges’ instead of employers… If only the pool was ‘everyone’ and the only insurer was the government…


    What we need to do, is encourage all employers to STOP offering group-plan health insurance as a benefit – to make it an individual-purchase product again.

    In such a system, you might, for example, health insurance might be 100% tax-deductable (to make it the same as if your employer was paying for it)… But you’d buy your own policy, that covers the things you want to pay to have covered (A 25yo single guy might ONLY buy catastrophic-coverage (or as many do, might buy nothing – a good chunk of the uninsured are such because they do not want health insurance), whereas a 40-something family of four might buy full coverage)…

    Costs would go down for everyone, without the ‘someone else is paying, why not?’ system we currently have.

  • Rick

    The best I have yet read on why socialism is collapsing. Well done.

  • My original recommendation was to treat employer health benefits as taxable income.. to get employers out of the business of healthcare. But hasn’t been politically possible, so my fallback was to make all health-care related expenses (on some approved list, not just what I label healthcare) tax-free, including their entire value chain (“if health care is uniquely important to all, like basic foodstuffs, don’t tax it – or its creation..”). Again, this gets employers out of the benefits trap we put them in back in WW2.

    And to manage costs decontrol all but “sworn (under perjury penalties) public comment and outcome statistics” maintained at the door (and now on the web) by every medical provider, drug company, device manufacture, hospital, (all who claim they are in the health (tax free) business), etc. for all their goods and services (each with a listed price) provided to the public. And drop all required credentialing.. i.e. they can post their credentials, but no special rights of prescribing or practice are limited to the credential or location of the provider. i.e. any and all (from any locale, around the world) can care, nurse, prescribe, do surgery, dentistry, orthodontics, false-teeth, and train, provide therapy, etc.. where the only requirement is posting a journal of prices, (partially anonymized transactions that can be un-obscured by auditors and courts), comments, and outcomes, subject to perjury penalties and (state / local government) audit for accuracy/completeness. Truthfulness of comment-under-oath will be determined in court / jury process if/when there are disputes. Loser pays. (and party on, given individuals can prescribe for themselves as long as they (and their supplier) publish the transaction and tally the results/outcomes).

    Treat people like children and they’ll behave like children. Expect better and we’ll be better. And you could choose to buy your Percocet from India (subject to publishing, comment and audit requirements – i.e. as your own “prescriber” you fall under the same rules – a little less privacy because you have to post as yourself – not a pharmacy that serves many).

    For the safety net I’d recommend localities fund public health clinics (delivered by private enterprise) clinics which have a research and national-security related mission in addition to health-care. i.e. epidemiology, early warning of disease and worse which sadly those least able to take care of themselves are the existing petri dish.. as well as experimental treatments where the poorest of the poor can choose to participate in the same programs the richest-of-the-rich subject themselves to (usually including intense pain and suffering) – in the most-often futile desire to live another year.

    And if we can return to neighborhood care of the victims of catastrophe, and indigent and feeble – part of local governance – these local elected officials (city/ward councils) would have the ability to put people away (not into the old public asylums but privately run group homes subject to the same reporting and audit requirements) for their own and the neighborhood’s good – health of civil society, subject to local habeas corpus pleas – but again w/ those making the court case taking responsibility for the outcome (if released, they pay the subsequent bills if the subject is again determined by the local board to be a dependent child, irrespective of age, if any).

  • Lavaux

    WRM gets the practical implications of blue modeling right except for the finance. Blue model schemes rely heavily on the assumption of unrestricted access to funds, whatever their source, throughout the life of the scheme. But capital is scarce, and as blue model schemes suck up an ever greater share of the nation’s available capital, the opportunity costs will become extreme, even to the point where their costs exceed their benefits to all stakeholders.

    For example, the blue scheme we call Social Security simply assumes that to the extent contributions and Trust assets on hand are insufficient to meet benefit payments in any given period, some other readily accessible source of funds will be available to cover the shortfall. In honor of this assumption, Congress spent all of the Trust assets and replaced them with IOUs, and the Treasury simply honors the IOUs with freshly printed but inflationary cash. Congress has also cut contributions to stimulate the economy, worsening the scheme’s financial position going forward.

    The way I’ve heard it, Congress spends about 60% of what it spends on various entitlements, including the $1.6 trillion Congress has to borrow per year to thus spend. Add the money Congress has printed to the money it’s borrowed in the past five years, and we’re well beyond $10 trillion. But these sources of funds won’t be available much longer at these quantities, at which point in time the blue model schemes hit the wall. In sum, the Blue Model Masterminds’ most significant limitation is not information or complexity but finance.

  • CatoRenasci

    gjosh wrote:
    Just like Walter Russell Mead’s other recent articles about the so-called “blue model” (his term), this piece is rich with interesting ideas and theoretical models for thinking about our current political crisis–but also completely lacking in helpful suggestions for how to make anything better.

    Mead’s inability to see solutions only reinforces the intellectual bankruptcy of the “Blue model” as well as financial bankruptcy he describes.

    At least one ought to give him credit for the intellectual honesty to admit his preferred model is irretrievably broken.

    The fact that he doesn’t understand (or won’t acknowledge) that classical liberal thinkers understood the topology of the problem, warned about it ahead of time, and have been proven right in spades demonstrates the degree to which he remains captive to progressivism.

    Glenn Reynolds’ interview of Mead on PJTV this week was highly illuminating on that score.

  • Sam Abrams

    There is no doubt about it. Americans are eager to omit insurance for our children, for those with pre-existing conditions, with Americans who require life-or-death emergency care and they long for the opportunity to reduce benefits for the elderly. Our current national motto: “the more we give to others, the less we have for ourselves” . GO 21st century America!

  • To be fair to the “Blues,” Obama did choose a “Red” plan over the Blues. The Blues wanted Medicare for All. Obama wanted Republican support so he went with the Red version. That’s where the disaster lies and he deserves his rebuke.

  • gmedmed

    As long as we have a system that allows asthmatics to use crack cocaine and spend two weeks in an ICU on the tax-payers’ dime or forces us all to pay for novel $100,000 leukemia treatments for an illegal immigrant’s daughter, our system will be unsustainable.

  • gmedmed

    Wells Fargo…please explain how “Obamacare” is a Red Plan. Medicare for All would be Hillary-Care. Obamacare was simply Hillary-care Lite. The solutions that Republicans were offering are nothing like Obamacare: increased competition in the private healthcare marketplace, tort reform, expansion of HSA’s, increased personal accountability.

    Giving away “free” health-insurance to all is NOT the solution. Without any skin in the game, people will suck off the system until it goes dry. I see examples everyday: “needy” mothers who drive up to our clinic in Escalades and bring in their children who have nothing more than a cold to get a free $120 taxpayer-funded visit because it costs them nothing, or children with iPhones who are getting free physicals.

  • MarkE

    In the United States health expenditures across all sectors consumes 18% of GDP in 2012. The government pays for 48% of healthcare across all sectors.
    Since taxes and fees paid to the government are regarded as a sunk cost, consumers and producers of healthcare view this as a subsidy. This extravagant “subsidy” has created a healthcare “bubble”.
    The good that medical subsidies do is in caring for the poor and helpless. The evil that the subsidies do is in inflating prices and costs of healthcare and in creating all manner of secondary corruption.
    The question is “how much subsidy is the right amount.” The answer is probably less than 48%. If the subsidy were reduced to 25%, the bubble would collapse. Prices would come down and the middle class could afford reasonable medical care and health insurance. The bulk of the subsidy could be spent on the poor and helpless.
    Bubbles always collapse. If we can’t deflate this one gingerly, the resulting chaos, failure and confusion are likely to be very painful.

  • Obamacare was created by The Heritage Foundation and championed by the right-wing as the health care solution. The individual mandate was created by the Republicans as a method of distributing government dollars to the insurance and pharma industries.

    That may be something you do not wish to face up to. But you can’t change reality no matter how hard you close your eyes.

    Obamacare is not socialism or free marketism. It is corporatism and that is something both parties can agree on. Republicans were for Obamacare before they were against it.

    Ultimately, we will have single-payer healthcare in 20 to 30 years after the failure of free market healthcare and whatever else gets tried.

    Republicans will rue the day they turned on their own plan.

  • gmedmed

    Wells Fargo…surely you jest?

    Obamacare was NOT created by the Heritage foundation. Show me a link or reference that shows that Obamacare was created by The Heritage Foundation. That 2,000 page monstrosity was written and created and then voted for by Democrats and President Obama ONLY.

    Perhaps one could argue that Republicans used to feel that if government were already going to have to subsidize free health care anyway through programs like Medicare and Medicaid, then a responsible idea might be to “tax” everyone into paying for their own medical care.

    But things like keeping kids on their parent’s insurance dole until age 26 or robbing the Medicare account or forcing employers to provide healthcare or pay a penalty or expanding Medicaid were NOT Republican or Heritage Foundation ideas.

  • Renfield

    “Ultimately, we will have single-payer healthcare in 20 to 30 years after the failure of free market healthcare and whatever else gets tried.”

    Sorry, Wells, but socialism’s window is fast closing with the crashing and burning of the European Utopias. The stars aren’t going to align again in America.

    And just what is the “failure of free market”? No Utopia?

    “Republicans will rue the day they turned on their own plan.”

    It never was their plan. One conservative think tank suggested a mandate as a possibility to be examined. It was rejected. No conservatives pushed it. However, after Obamacare dies, the lib narrative will forever be how it was a Republican/conservative plan.

  • Norman

    When ObamaCare finally was to kick in so that young people, without much income, would be obligated to pay $5,400 per year (they spend $900) with the intent by the Democrats which wrote the bill to pay for older people who use more medical care.

    I find it amazing the GOP hasn’t used this regressive tax against the Democrats especially since the latter are waging class warfare against millionaires. They actually waged it against the young.

  • Sorry boys. The Heritage Foundations document for the Romney plan is available to review on the internet. You are in denial.

    Yes, it is not Obamacare word-for-word. If you want that kind of out, go ahead and take it.

    I’ve heard Mitt, Newt, Bob Dole, Jack Kemp and Lindsey Graham advocate for it with my own ears. That was a decade ago so we can pretend it never happened.

    The Dems are going to be able to pass the collapse of the healthcare system over to the Republicans once Obamacare is overturned. The Dems will always be able to say that they had a solution even if it is not true. If it had gone through, the Dems would have been forever responsible for its failure despite the fact that the turd was hatched by Republicans.

    Now when the stinkbomb goes off (and it is going to and then some), it is going to be a stink that will never wear off. And the Republicans are going to have to live with that stink for a long, long time. Enjoy it while you can because the rebound effect is going to be a b****.

  • gallatin

    Mead’s hitting the right issues here. The U.S. health care system needs innovation BADLY, and all the ideeas addressing the problem – Obamacare or “Stay the Course” – are ignoring this. We need a lot more evidence-based medicine, a lot less mandated plan designs, and a purging of lawyers from the process or we’re headed for the Jeffrey Toobin Memorial trainwreck.

  • mike

    The Government’s rationale for the constitutionality of the individual mandate is unsustainable in the context of established principles of biology, clinical medicine and ethics. See the following article in the Mayo Clinic’s journal

    The Government’s rationale is based on the inevitability-of-needing-healthcare argument. Yes, everyone will need some kind of healthcare in their lives. But not everyone will need all forms of healthcare. Everyone is not at equal risk of all diseases.
    Healthcare is not a unitary thing. We don’t all get the same 10cc injection of “healthcare” no matter what the illness.
    There are many conditions and illnesses for which many people would never rationally insure against. There is a large degree of predictability.
    Under the new healthcare law everyone will have to be insured against the complete array of illnesses, conditions and disorders.
    There is no limiting principle. The Government would have no limit on its powers. You could use the same logic and say that EVERYONE needs a lifestyle. Health care is just as nebulous concept as lifestyle.

  • gjosh

    Of all of Mead’s insights, I am especially intrigued by his discussion of how difficult it is to impose government regulation on complex systems. This really does seem to be a major problem, especially with our current health care woes.

    But I reject Mead’s inability to find solutions to this problem. When governments are paralyzed by complexity and by competing interest groups, eventually they must forcibly impose simplicity in the interest of justice and progress for their citizens.

    It has not escaped my attention that the general thrust of Mead’s arguments, and of many libertarians as well, is that the pursuit of goals like public health and equal access to insurance coverage is just too costly to sustain anymore. I reject this judgment as being (1) untrue, as a financial matter, based on the example of many European and Asian countries; and (2) immoral, simply because I am an American who cares about his fellow citizens and a taxpayer who feels he has a right to live in a country with a high standard of public health.

    I refuse to lament the impracticability of solutions that we have never tried because of political gridlock and rent-seeking in Washington. It seems to me that the interests of justice require us to forcibly simplify the health care system by imposing a single-payer, unified insurance system as has been accomplished in Taiwan and France, for example. This would provide a centralized repository for negotiating better prices, gathering data, storing records, promoting efficiencies, and reducing administrative costs. It would serve as a model for how to simplify and tackle other problems we face.

    I recommend T.R. Reid’s fine book “The Healing of America.” Fareed Zakaria’s recent CNN special on health care discussed many international examples highlighted in the book. The message is clear: Complex systems aren’t half as complicated as they seem, and budgetary woes aren’t half as insurmountable as they seem, when politicians exercise a little bit of courage and leadership.

  • #99 – Amen

  • Andrew P

    Why did the Democrats pass this monstrosity of ObamaCare? They wanted to do a complete takeover of health care in any case, but the loss of Kennedy’s Senate seat cost them their 60th Senator and forced them to enact the Senate bill unchanged. Their original plan was a conference with the House and new bill that barely resembled the Senate one, but they lost this option. It was the Senate bill or nothing, so they passed the Senate bill complete with all its constitutional and practical flaws.

  • Marju

    State and Federal governments have made healthcare complicated with all their meddling. Just have laws on malpractice and fraud and otherwise butt out to let individuals figure out what they want and order it cafeteria stye – across state lines – from companies that offer what they need.

  • indipete

    A great article, but, by its organization, directed more toward the like-minded than to those opposed. A lot of the opposed won’t get past the title or first part of it. Consequently, I could not forward the article, as is, to liberal friends. What I did do, in two separate emails, is send excerpts, as follows:

    EMAIL 1:

    What government can and can’t effectively regulate:

    EXCERPTS from Walter Russell Mead:

    …[government] regulation works best in simple systems. Social Security doesn’t have a lot of whistles and bells. Retirement, retirement age, actuarial projects, payroll tax deductions: these are relatively simple things… Social Security could be run by accountants with adding machines; there is no rocket science involved.
    Not so the government’s brave ventures into health care. People who’ve devoted their lives to the study of our health care system… don’t understand everything about it or how it all works. Tweak a Medicare reimbursement formula, and suddenly nurses are getting a windfall in Chicago while GP practices are shutting down across Kansas. As the numbers grow, and the complexity of the system increases, the opportunities and incentives for fraud balloon — again, often in ways that those trying to ‘fix’ the system don’t understand or predict.
    In the real world it is impossible to avoid a significant government presence in the health care sector; from veterans’ care to pediatric care to the care of the poor, there are too many reasons why government at some level must ensure care to build a purely private health system.
    But our approach to health care must be to create possibilities and incentives for innovation and change, rather than to keep the current system alive by pumping ever growing volumes of money into it…

    EMAIL 2:

    The government’s justification for the individual mandate [subject line]

    The government’s justification for the Affordable Care Act’s individual mandate:
    EXCERPT, from Walter Russell Mead:
    Supporters of the [individual mandate] rise to argue that when the young men grow older they will need more care and then they will benefit from cheaper premiums as they in turn are subsidized by the next wave of suckers, excuse me, young people. But Obamacare isn’t fiscally balanced or sustainable; its true costs were disguised by accounting tricks like postponing some of its impacts while collecting its revenues so that the first ten years of the program looked good on Congressional Budget Office scoring sheets.
    Cheap tricks might work to befuddle lazy reporters (or allow the ideologically committed to collude in the deception of readers for the greater good), but they won’t pay the bills or stop the inexorable rise in health costs. By the time today’s young people are ready to collect, without the kind of innovation that Obamacare is likely to prevent rather than encourage, the system will have to be curtailed out of financial necessity…


    In such a way, I think Mead’s excellent arguments and article are much more likely to get a reading from the people who would not otherwise do so.

  • I found two things new and helpful in this discussion. First many commenters made a distinction between scheduled care and emergent/catastrophic care. I had a combination of the two this week – tooth extraction followed by unexpected heavy bleeding. Here in the Australian system my private insurance covered some of the first, but when the bleeding emerged the public system stepped in. So no huge bill because something went wrong.

    The second thing is that I finally see some Americans acknowledging the elephant in the room. The US medical system costs twice as much as that of other advanced countries and the health outcomes are slightly worse. The elephant is the double cost, not the outcomes. I’m both a US and an Aussie citizen and I have to agree with those who think the solution is some kind of hybrid system of public and private. Australia started with socialized medicine in the 70s and it has refined the relationship between our public and private systems since those days. But the bottom line is that we do have competition and it works. If the private insurance system gets too expensive people drop their insurance and rely on the public system. If the waiting lists and other problems of state run systems get too obnoxious people buy insurance. It is a different system than the US, but it produces better outcomes than the US for half the cost (8.5% of GDP). The 16-18% of GDP that is being quoted for the US is the the great honking pachyderm that is eating your lunch.

    I would also point out that the US already covers the poor and the undocumented through its public hospital system but funds it in an uncontrolled and horrendously inefficient way as many have pointed out. Many commenters also had credible remedies. While I don’t think all aspects of healthcare (the emergent and the catastrophic most of all) lend themselves to free market competition, there is no way the US is going to cut that elephant in half without the help of free markets.

    Finally I thought that the claim that Obama’s health bill is a Republican initiative clearly demonstrates how much some Democrats want to disassociate themselves from what they are now realizing is an unworkable bill. What I recall was that the Democrats had to offer major incentives to the two furthest right Blue Dog Democrats to get the bill through the senate. That some republicans proposed some of the ideas in it 10 years ago is not of any significance. Many Democrats and Republics put forward lots of ideas during the Hillarycare debate in he 90s and noting they said then gets any of the Democrats who passed Obamacare off the hook. I think Obama had the duty and the power, but not the experience, to bully the congress into producing a better bill. Instead he ended up having to settle for the mess they gave him. That said I agree with the line of argument that the Republicans are corporatists who also propose 20th century solutions to 21st century problems. I also think that Prof mead and many of the commenters on this blog are well ahead of both parties.

  • Kendrick1

    When I first started working (1957) my health insurance premium was $25 per month from a group policy, and with a 20% co-pay. No pre-existing condition (PEC) clause, and health insurance could be bought any state line from anywhere in the U.S. At that time, there were literally hundreds of health insurance providers in the state where I lived.

    Then, in the glorious wisdom of our state legislators, it was decided that each insurance company must have a PEC clause. All but a 1/2 handful of health insurances companies left the state, and that puts us where we are today! Later, the no crossing state lines to buy/sell health insurance came into effect.

    No insurance company can operate profitably under those conditions and still maintain low premiums — unless with a subsidy or mandate.

    Just think about it outside the box. Take fire insurance, for example.

    How could an insurance provider exist if they were forced to sell policies to the property holder after the property had burned !!! Try and buy a policy like that for any kind of disaster!!! Please let us know if you find one!

  • Droidist

    Private systems unsustainable?
    I’m a grumpy old [person], so *I* remember when the legislation was pushed through ― HMOs, which is where this started, by the cost shifting HMOs allowed, which inculcated the “free )nch” syndrome into medical care ― was a promise by its architect the “Lie-on Of The Senate”, waitress-sandwich Kennedy that this would “fix all the problems inherent in the fee-for-service system, and give us a modern system, such as Great Britain has…”
    Except he was never very specific about what the problems *were*!
    The poor went to charities, religious or secular, charitable or teaching hospitals, and unless you *refused* to seek help you were helped.

  • I hear we had that in the early twentieth century. It [failed] to work so well that we ended up moving towards a more socialized system, along with everybody else in the Developed World.

    It failed in large part BECAUSE of the Social Darwinism that is far, far less of a problem today.

    And those more socialized systems (1) are not guaranteed to be sustainable and (2) reduce both the incentives and opportunities to develop work-arounds to them, to implement when they get it wrong about YOUR needs.

    If you want to see what that type of charity buys, take a look at how much funding different charity disease prevention groups get – it’s all about popularity. AIDS gets tons, while less well-known diseases that kill easily as many get only a fraction of that funding.

    You think that doesn’t happen with public funding? Not only does it happen, but it is harder to re-direct those funds to better use once we come to our senses, because of the politics.

    I’ll take the Canadian System (with its wait-times) or the German system (which doesn’t have them) over that any day.

    They look nice now … but when the money gets tight, do you want to trust your life to the Ezekiel Emmanuel’s of the world, with no recourse when they decide that saving your life is simply not cost-effective for the “greater good”?

    That is the difference here. America is built upon the premise that life, liberty, and the pursuit of happiness of the INDIVIDUAL is above even a majority vote to deny, in the absence of criminal behavior that threatens those rights for others.

    Many of these other nations have swallowed the blue pill of “the greater good” being the objective of governance … and the life, liberty, and ability to pursue happiness of their citizens is vulnerable, as a result.

  • Grant Devereaux

    The Public hates what has been described as Obamacare by the right wing, but not actual Obamacare. No one hates having pre-existing conditions covered, having no limits on lifetime coverage, allowing one’s children to stay on their health care coverage through the age of twenty-six and other provisions of the law. What they hat eis the lie that the right wing has said about Obamacare: that it socializes health care, that people are forced to have coverage (they are not, they can pay a small tax if they elect not to have health care insurance), that it replaces Medicare (ridiculous), that it forces women to have abortions(Say what?), that government death panels will decide who lives and who dies – a total lie. People hate what they have heard Obamacare is, but not what it really is.

  • Curt

    There are smart people in the [disrespectful reference to the President of the United States deleted] administration?? When did that happen?

  • redmanrt

    Meade writes: “Obamacare is not all bad…”

    Any bill that important which was passed the way it was passed is all bad.

  • William

    Montana gets roads so that people from Oregon can drive to Illinois. It’s a fact of life that people get old and as they do their health care costs increase. It’s a fact that insurance companies don’t like covering you then. To a great decree regardless of whether you are rich or poor, you are are going to need the very similar health care over your life time. So the poor do not have the disposable income to bank for their predictable sicker years. What’s your solution?

  • Farcaster

    First, individual parts of the law are extremely popular, excluding the mandate. No wonder; the other parts of the law are the carrots and the mandate is the stick.

    Let’s walk through the law and see what the outcome should be:

    The three-legged stool of ACA:

    1) Mandate: Make sure young folks pay in too, as they have lower healthcare costs. This helps reduce coverage costs per person and therefore premiums. The lower premiums are a win for most consumers, while insurance companies can do the math and set premiums to cover their lower costs (a wash for them). So say 20 million more uninsured young pay in, while the 290 million rest of us get the benefit in lower premiums.

    2) Guaranteed Issue / Community Pricing: No exclusion or higher prices for those with pre-existing conditions. Forcing insurance companies to take these sick folks is an upward pressure on premium costs for everyone to the extent the insurance companies are allowed to pass the hit to consumers rather than management and shareholders. So this helps say 10 million uninsured with pre-existing conditions excluded from insurance previously, while hurting the 300 million who pay higher premiums to cover the higher average cost. In other words, the costs of these folks are spread around.

    3) Subsidies: The poor that cannot afford to pay insurance premiums get subsidies from the government to pay their way. So say 20 million uninsured that cannot afford insurance are helped with the higher costs spread to the rest of us via higher taxes.
    Our choices basically then:

    A) If you take away the mandate but keep 2 and 3, most of us get higher premiums (from
    2) and higher taxes (from 3) while benefiting a minority that is either poor or unable to get insurance today due to pre-existing conditions. Insurance companies can raise premiums to cover their costs so they’ll be fine. A good society should probably be willing to take that hit to help their fellow citizens.

    B) If you leave the mandate in, essentially one minority segment (the young) partially offsets the cost of the other two minority segments (poor and excluded). Premiums are probably a wash for the rest of us, but we pay a bit more in taxes to cover the poor. Most of this tax burden is covered by the rich. A good society should probably be willing to take that hit to help their fellow citizens. Seems like a good use of the “General Welfare” authority in the Constitution.

    C) If you throw the whole thing out, we go back to having 50 million uninsured. That is not an outcome we should be proud of.

  • MD

    Excellent column. But I have to comment on one thing:
    You are half right about why more money is needed to pay for the boomers. What you forget is that the boomers already paid for both medicare and social security for the last 40+ years in unprecedented numbers. There should be a HUGE surplus as those drawing these services have been far fewer than those paying…up until now when the boomers are beginning to retire. But you have forgotten how many times these funds were raided by past presidents and congresses for their favorite social give-aways and who always said they would pay it back but never did. Even Al Gore knew we needed a “lock box” to stop the raids and prevent those young males (and females!) from paying a burden they never should have had to pay. Those raids paid for all kinds of social programs that are now killing state and federal budgets because the money is gone but the mandates continue….and the income tax breaks have resulted in almost half not paying anything at all.

    It was Margaret Thatcher who said “the problem with socialism is that eventually you run out of other people’s money to spend.” How true. Now the boomers will not get what they paid for (and was given to many who paid not at all) and the youth will pay through the nose for problems created before they were born…and have to help their boomer parents who have been cheated so many times.

  • Grant Deveraux …

    No one hates having pre-existing conditions covered, having no limits on lifetime coverage, allowing one’s children to stay on their health care coverage through the age of twenty-six and other provisions of the law.

    And no one hates free ice cream and a pony, either … until they are handed a shovel and told to clean up after the pony.

    We already are seeing that Obamacare, AS IS, is going to cost a LOT more than what was originally presented … so how are we going to finance it, given that we are already borrowing money to keep this government solvent?

    What they hat eis the lie that the right wing has said about Obamacare: that it socializes health care,

    That is no lie … it places everyone’s health care under the control of the government, to a far greater degree than the regulatory “services” and limited/group-targeted insurance programs currently provided by the government do today … programs that have become unsustainable entitlements, already.

    The insurance – today – may be managed by private companies, but the government will exert far greater control over the process than ever before, because they will be controlling the finances like never before.

    that people are forced to have coverage (they are not, they can pay a small tax if they elect not to have health care insurance)

    In other words, a tax, not on consumption or income or even wealth … but on breathing. This is unprecedented.

    But is it really a tax, today? It wasn’t initially presented that way, to gain approval.

    And unless that “tax” is so onerous it compels people to purchase insurance, it defeats the purpose of Obamacare’s individual mandate … to add those who today CHOOSE to forego insurance, and employers who refuse to provide it, to the pool. This will undercut the financial supports even more.

    that it replaces Medicare (ridiculous)

    Not replace it – defund it greatly, to support the health care of younger people. We have already seen the planned cuts in Medicare funding to do this.

    that it forces women to have abortions(Say what?) that government death panels will decide who lives and who dies – a total lie. People hate what they have heard Obamacare is, but not what it really is.

    These last two aren’t present … for now.

    But as bad as this tax-sucking entitlement is on paper, more and more people are coming to hate even more what it can become, once implemented.

    As the cost grows, government will demand more and more control over the system in an attempt to “control” it … opening the door to the very utilitarian measures you describe.

    There WILL be rationing … and those who control the rationing are a de facto “death panel”, operating at BOTH ends of the human life cycle (and in between).

    As I said earlier, control, not ownership, of the insurance providers is all they need … but it can get a lot worse than even that.

    When politicians start “sweetening” Obamacare in the ways they did Social Security and Medicare, there will be insurance companies that will leave the business because they will no longer be able to make a profit under the rules … the government simply will not be able to give them the money they need.

    The resultant collapse of the private-sector insurance market will leave a vacuum that Mr. Obama and his ilk will fill in the way they have always desired … a single-payer “public option” that will be the ONLY option, with no recourse for you when they fail to meet YOUR needs … no way to re-negotiate insurance terms outside the glacial and unpredictable political process, no way to change insurers, no access to charitable care, no way to even pay cash.

    As I said to Brett earlier, America is built upon the premise that life, liberty, and the pursuit of happiness of the INDIVIDUAL is above even a majority vote to deny, in the absence of criminal behavior that threatens those rights for others.

    Government control of my health care that threatens to eliminate my ability to work around the inevitable misjudgments of politicians and bureaucrats, is a threat to my life, liberty and ability to pursue happiness.

    And yours too.

    And Obamacare, even before it gets to the worst-case scenario, is a threat to those rights.

    That is why the hate for it is there.

  • Forecaster …

    C) If you throw the whole thing out, we go back to having 50 million uninsured. That is not an outcome we should be proud of.

    Doesn’t have to be that way, even without Obamacare … if WE are willing to take back the responsibility for solving this problem, for ourselves and for our neighbors … instead of outsourcing it to the Best and Brightest in DC, as if we are helpless serfs that must depend upon them to take care of us.

    Our leaders need to stop lying to us, that they can solve our problems FOR us, better than we can … when they are so specific to the individual that our leaders (regardless of intent) lack the omniscience needed to get the answers right … and so deeply affect our life, liberty, and ability to pursue happiness that we can settle for no less than getting them right for EACH and EVERY American.

    Compared to what it would take for the Best and Brightest to actually solve these problems FOR us, going to the moon looks like playing with Tinkertoys … and we know what kind of effort that took.

    This is the basic fallacy of the entire Blue Model … that a few “experts” can produce better outcomes with respect to both liberty and prosperity, than engaging 300 million problem-solvers to solve the problems around them, outside of government.

  • Bianca

    This piece of writing is interesting, but rather bewildering. The individual mandate that Obamacare is modeled on was passed into legislation by a Republican, which is an inconvenient truth considering who that Republican is. All of the colorful analogies about rain forests and ecosystems can’t get rid of the fact that this was once an idea that was recently supported by Mitt Romney. All of the broad “blue” and “left” terminology paint a rather vague picture of what the problem is with this bill with such bipartisan roots.

  • Peter Thomas

    The analysis may be correct in that the legislation is a bloated morass and that special interests paws are all over it but this is the nature of the political process. Whatever objections you may have in principle, it is naive in the extreme to think that the Supreme Court striking it down will be a good thing as it will allow for politicians to go back to the drawing board – what is the likelihood that the next drawing is going to be any prettier? You really believe that the Republicans – the Party of No – are actually going to suggest something reformative? Look at the overwhelming ignorance displayed in this post + comments. Individual payments, refuse care at e-rooms, barring non-citizens + belief in the “free market”. People do not understand the healthcare market – it’s all socialized > everyone already pays for the uninsured through their premiums; the young and healthy already subsidize the older and less healthy in their small pools of (socialized) group insurance. The US pays more for drugs and in so doing subsidizes the rest of the world. You are spending 16% of GDP on healthcare (more than double the average) and you can’t ensure basic care for all inhabitants. And contrary to Justice Scalia’s limited understanding of economics, healthcare is a social good – you get sick and can’t access treatment also increases the likelihood of me getting sick when coming into contact with you, etc. You can bar non-citizens if you want – just a more disease-ridden society to live in. But at least you’ll have more money, except that you won’t because you’ll have to spend more on treating your increased levels of ill-health.

    As for healthcare being somehow an example of “blue” thinking, such a proposition is hard to maintain given that the centerpiece of the law, the individual mandate, was being proposed by the Republicans in the middle of the 1990s in response to Clinton’s healthcare plan (remember that, another example of when healthcare reform failed to pass). How does this fact fit into the “blue model” thesis?

  • Jim.

    If this get repealed, that would be a real stroke of luck for Romney… a lot of the ambivalence towards him is due to the fact that conservatives don’t trust him to help kill it. That might — mind you, I say might — even result in letting the base get fired up about him (as they would for Santorum), which would propel him to victory.

    Anyway, about the law itself, what can I say that hasn’t been said by folks like Yahzooman? There are simple alternatives — limits on malpractice suits, sticker prices for medical products and services, extending tax deductibility to self-insured, allowing a la carte insurance (be your own death panel, based on what coverage you pick — the only policy consistent with both solvency and liberty). These could be implemented at a fraction of the cost and complexity of ObamaCare, and would have positve results at least as great.

    We can make the system better. We can improve it. We just have to REPEAL first, and avoid the over-promising stupidity of single-payer.

    It’s not that tough.

  • EvilBuzzard

    The only thing that will ever make health care policy make sense is well-intentioned cruelty. Make things cost what they really and truly cost. This will straight-up kill a small number of very unfortunate people.

    If that does horrible injustice to some people, we have to suck it up. Otherwise, health care costs will continue to do injustice to every American who cannot find a job or insurance because nobody is willing to eat a cost that has been rediculously inflated by all the “free” government money infused into our current system.

  • Patrick Booth

    Mead’s blog was brilliant and fun to read!

    Almost every single American is largely insulated from the cost of their personal health and health care. 175 Million are covered by commercial insurance, usually tax-favored employer-sponsored plans that cover about 70% of cost, and this private sector segement will shrink under ObamaCare as premiums skyrocket. 95 Million are covered by Medicare and Medicaid, and other people’s tax money covers more than 90% of all these costs, and with an aging population and expanded Medicaid eligibilty under ObamaCare, this segment will explode costs. There are roughly 40 Million others uncovered by insurance due to poverty, alien status, or personal choice – and these people pay almost nothing for their care. Under ObamCare, half of these folks will be shifted to Medicaid, and there will be a huge new wave of uninsured working-class patients hoping for highly subsidized insurance in an “exchange”.

    So, yes, as Mead says, the system is too complex to change with a single masterstroke, but it is not chaotic. The main problem is SIMPLE to see and understand – excessive UTILIZATION! It is as if every piece of our current system is perfectly designed to work in harmony to increase utilization; 1)highly subsidized care – patients have little skin in the game to ration or shop for their own care, 2)an American population less healthy than most other developed countries, 3)fee-for-service medicine that encourages physicians and hospitals to spend more money,and 4)our nation’s willingness to finance advances in medicine and technology for the world.

    While there is no magic solution,redesigning all private and government insurance plans so that individual patients pay a greater portion of their premiums and claims over time will begin to bend the cost curve for our nation. Maybe we will become healthier along the way!

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