- The Washington Times - Tuesday, March 22, 2011

ANALYSIS/OPINION:

The president signed Obamacare into law one year ago today. Washington’s takeover of health care has imposed more bureaucratic controls on a system already hobbled by too much government intervention. Solutions should spring from good medicine and good markets, not from a Big Brother power grab.

The more government inserts itself into the health care market, the more pharmaceutical companies work to game the system rather than find cures. Policy guru James Pinkerton advises that policymakers can change the dynamic by limiting drugmakers’ liability to abusive lawsuits, providing longer-lasting intellectual-property rights and streamlining the Food and Drug Administration to decrease the time and cost to get medicines approved. The goal is to free companies from a legally defensive business strategy so they can focus on innovation, “anything we can think of to enlist our best brains in the cure process,” he told The Washington Times.

The way forward is to focus on a market-based approach. As James C. Capretta of the Ethics and Public Policy Center explained in Thursday testimony to the House Budget Committee, the structure of government subsidies for Medicare, Medicaid and (through the tax code) extravagant employer-provided health insurance is responsible for causing health care costs to skyrocket. Medicaid, for instance, is financed by federal matching payments “with no limit on the amount that can be drawn from the U.S. Treasury each year.” There’s no surprise that busts the bank.

As an alternative, Mr. Capretta points to the only commercial portion of the 2006 Medicare prescription-drug law. If government is to provide any subsidy, its amount should be fixed, and consumers and suppliers should be free to bargain for the best deal. That was done with drug coverage for Medicare Part D, and it worked. “Federal spending,” Mr. Capretta testified, “has come in 40 percent below expectations.” If a similar competitive bidding system were used throughout the whole Medicare program rather than just for prescription drugs, taxpayer costs could be contained similarly.

Government control raises health care prices and limits supply, leading to rationing. It’s time to put Obamacare out of its misery.

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