Monday, October 27, 2008

What Robert Carroll and the WSJ don't understand about Health Care

This morning's WSJ article about Senator McCain's health care plan was dripping with so much ignorance and misinformation it almost made me cry. Carroll's main argument is that McCain's plan will reduce health care costs by encouraging people to purchase less expensive medical coverage. His comparison to home or auto insurance and his question of "Do these cover routine spending on cleaning the gutters or tuning up a car?" completely misses the point that health care is cheapest when preventative care is encouraged and provided. By covering only catastrophic incidents many people will opt out of seeking regular medical care that will ultimately reduce the overall costs of health care. The problem with health care costs aren't the actual care that Americans receive but the endless paperwork and insurance company make-work that is absent from most other industrialized countries, allowing them to spend less and live longer. To propose reducing health care costs by reducing plan coverage would be like saying you can have a car for less money but it doesn't come with an engine or wheels.

On top of this dismissal of preventative care, Carroll misses the mark on how the disappearance of employer provided health care will work in this country. One of the biggest obstacles to obtaining health care as an individual is the insurance companies' tireless efforts to screen out any risk. Individual insurance lacks the "market power" of an employer plan which leaves buyers more at the mercy of the insurance companies. An insurance company is not going to give people better care or lower costs out of the goodness of their corporate hearts so the collective bargaining power of a whole company can help ensure quality affordable coverage.

Dr. Carroll's comparison of the current tax subsidies versus the ones proposed by Senator McCain is flawed because he is comparing McCain's proposed plan (which he already noted would have higher deductibles and less coverage) against the current system. Therefore not only will people under McCain's plan be taxed on their employer provided health care benefits, they will also be paying larger sums out of pocket for care, which for many Americans will mean forgoing treatment they think they can live without. This is a horrific way to reduce health care costs.

I don't kow if Dr. Carroll simply didn't think of these issues or if he is cynically attempting to fool the readers of the WSJ but his analysis is fundamentally flawed. Senator McCain's health care proposal in the long run will reduce coverage, increase the price paid by consumers and force many companies to stop offering health insurance to employees, leaving many Americans with chronic illnesses or other health problems uninsurable. If you believe the GOP claims that they will force the insurance companies to insure the riskiest Americans then you clearly have not listened to anything they've said about the invisible hand of the market.

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