BANDOW: Re-reforming health care

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The basic issue of health care reform was simple: Who decides? The Democrats’ answer: The government.

But the battle is not over. The fight continues.

The U.S. medical system is an inefficient hybrid, with government paying nearly half of the bills and shaping private spending through the tax preference for employer-provided insurance. The result is a third-party payment system in which nearly nine of 10 medical dollars are paid in the first instance by someone else.

No surprise, national outlays are high and rising.

“Reform” was necessary, but in what direction? Expand government control? Or increase patient choice?

The former was the favorite in Washington. During the Clinton health care debate, Wall Street analyst Kenneth Abramowitz opined: “Right now, health care is purchased by 250 million morons called U.S. citizens.” It was necessary to “move them out, reduce their influence, and let smart professionals buy it on our behalf.”

“Reformers” started with the assumption that “we” spend too much on health care. In fact, bad incentives as a result of third-party payment meant we buy medical care inefficiently.

But it makes no sense to total up expenditures on health care and let the government decide whether they are appropriate. After all, we don’t complain about national spending on cars, beer, art or anything else.

New technologies, drugs and devices greatly enhance the length and quality of Americans’ lives. Given the importance of medical care, individuals should make the inevitable and difficult trade-offs.

Obviously, choosing health care is more difficult than buying an auto. But no matter how well-intentioned and knowledgeable, “smart professionals” are not equipped to decide how much we pay for what.

If public money is being spent, government has to make decisions about how much will be spent for what purpose. But that is not the sort of decision government should make for the rest of us. With Obamacare, this sort of government control is inevitable.

Deciding government coverage is inherently political. An academic review warned that Oregon’s Medicaid system “has not operated as the scientific result of rationing that it was advertised to be.” Instead, “controversies around the list forced administrators to make political concessions and move medical services ‘by hand’ to satisfy constituency pressures.”

This is what foreign nationalized systems do also. In February, in the midst of the debate over the Obama health care proposal, Newfoundland Premier Danny Williams flew to Miami for a heart operation. Mr. Williams explained: “This was my heart, my choice and my health.”

Waiting lists in Britain and Canada run in the hundreds of thousands, and wait times for treatment run in the months. The Supreme Court of Canada observed in a challenge to the Canadian system: “Access to a waiting list is not access to health care.”

In many cases, the rationing is explicit. For instance, Britain’s National Institute of Health and Clinical Effectiveness (NICE) judges cost and efficacy in terms of “quality-adjusted life years.” The British government decides that some people’s lives simply aren’t worth saving.

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