When the Single Payer Becomes the Single Player
American medical care and its financing have been transformed over the last century. Up until about 1920, American medical care in was quite primitive. It is quite possible that before then, it would have been healthier for the average person to not visit a doctor. But then several factors coalesced. There were new pharmaceuticals, widespread acceptance of the germ theory, improved anesthesia and surgical techniques, vaccination, and standardization of medical education. People began to gain confidence that if you were admitted to a hospital that you might actually go back home instead of dying, as was the previous experience. Although these new advances look inexpensive to us, the cost was onerous for its time. People dreaded the cost of hospitalization.
Although it was the heyday of the Progressive Era, Americans had no stomach for nationalized health care. Free enterprise filled the void. Some hospitals in Texas began offering a group of teachers a small monthly fee to cover the cost of possible hospitalization. This was a true insurance plan much like car insurance. It covered only the cost of the hospital. You paid for all of your routine medical bills as they happened. This eventually became Blue Cross and it spurred the growth of other iterations on this theme.
It was not long before national policy and politics got involved, just like that unwanted relative that visits and never goes home. During World War II there was a shortage of workers to manufacture war materiel. To attract workers, they were offered healthcare benefits, and this became standard. At the same time, the businesses were allowed to write off these costs from their corporate taxes. By the early 1960’s almost 70% of American laborers had health insurance. This did not cover the poor and the elderly, so Washington gave us Medicaid and Medicare. These programs were mandated to cover some or all of medical care expenses. Gone were the days where you paid for everything except the hospital.
But now we are seeing the progeny of the law of unintended consequences. Private insurance, Medicare, and Medicaid are all third party payers. The whole system was flush with lots of money and medical services bloomed. Patients became indifferent to the cost of services, because, after all, someone else was paying for it. A sense of entitlement also ensued. The feeling was that if I am paying for this insurance, then I demand the premium (expensive) coverage. Patients no longer shopped around for more economical care. There was no longer any pressure from consumers to control costs. Price competition was gone. There have been many impotent attempts to control costs with HMOs, hospital utilization committees and pre-approval, to little effect.
And even if patients still demanded cheaper fees by shopping around, the costs would still go up. Every high-tech improvement in medical care comes with an almost exponential rise in cost. Every new CT scanner is over one million dollars. Robotic surgery equipment is around two million. Cancer drugs are often hundreds of thousands of dollars. And there are many fees I find hard to justify. For instance, at our local hospital, it costs over $20,000 just for the privilege of being wheeled into the OR. That is just the cost of using the room. It makes me sound old, but I remember when you could have open heart surgery, stay in the hospital for more than one week, and have a total bill of around $20,000.
And let us not forget that with all of this money flowing that the predators and scavengers are just outside the camp. The costs of defensive medicine are real. Just ask any high-risk specialist or emergency room doctor. It is hard to leave the ER with a bill of less than $1000. Tort reform is sorely needed.
And then came President Obama to save the day with the “Affordable Care Act.” That is one of the most incredible misnomers of all time. With an increase in mandated coverage, insurance for middle America has skyrocketed, with horrendous copay costs. Insurance companies are being driven out of the marketplace. Recent comments from the allies of Bernie Sanders sound like this was the intent all along. They have said that Obamacare was just the first step toward a single payer system—socialized medicine. They needed to bankrupt the medical insurance companies because they are too wealthy and strong. In the transition, the American public would be inured to these high costs and would welcome the federal government with open arms. After all, we already have Medicare and Medicaid.
We still could go down the road too often traveled, to collectivism known as socialized medicine. Of course, the sanitized name is single payer. Its proponents claim the moral superiority. After all, they are providing the greatest good for the most people. Everyone will be equal. What a Utopia!
I know the left hates her, but Ayn Rand, who lived under communism in Russia before coming to America, had this to say in 1946: “The greatest good for the greatest number is one of the most vicious slogans ever foisted on humanity. The slogan has no concrete specific meaning. There is no way to interpret it benevolently, but a great many ways it can be used to justify the most vicious actions.” She gives examples. Nazi Germany decided that the greatest good would be killing the Jews. They were after all, the majority and could define the greatest good. The Chinese Great Cultural Revolution killed off over 100 million people for the greater good.
Many will protest that those are extremes of collectivism and that it is unfair to use these examples. We are far too civilized for that and we are talking about collectivizing medicine, not the whole society. But in socialized medicine, the government owns you. Sooner or later you are of no concern for the greater good.
I pray for wisdom in Washington, but there seems to be a dearth of it. I am beginning to think that the greatest good will be to replace many of our politicians with real conservatives.