The Health Care Industry—Massive and Government Dependent

America still needs to be rescued from ObamaCare, writes Michael F. Cannon, director of health policy studies at the Cato Institute. Congress has a responsibility to do it right, Michael reminds readers.

The GOP’s American Health Care Act, weighs in NRO’s Jonah Goldberg, was “an attempt to placate almost everyone and left no one with any particular enthusiasm about passing it.”

The American Health Care Act turned into what Mr. Cannon calls the ObamaCare Preservation Act. “… every time they (the House) tried to fix the bill’s deficiencies, it ended up resembling Obamacare even more. It led them to preserve other Obamacare regulations, much of its spending, including the creation of new taxpayer bailouts of insurance companies. The amendments House leaders offered as purported compromises to conservatives just ended up increasing taxes, government spending, and market instability.”

(It) would have kept the very worst provisions of the law, including its so-called pre-existing conditions provisions. Because many Obamacare enrollees were sicker (and costlier) than anticipated, premiums skyrocketed and insurers backed out of state exchanges. With fewer options, sick people in some states faced low-quality coverage and collapsing markets.

(Congress) needs to drive down prices for the vast majority in the (individual) health-insurance market by repealing Obamacare in full. It could then subsidize those who still could not afford coverage by converting Medicaid to block grants that give states the flexibility to target those resources to the truly needy. Finally, it should drive prices downward by expanding tax-free health savings accounts (HSAs).

Back at the Manhattan Contrarian, Francis Menton adds some perspective of his own. Here, he quotes thezman.com on the iron law of economics—that all goods and services are rationed.

• The First Truth of Health Care:No health care plan or system can ever be taken seriously unless it addresses, up front, how it will say “No, you cannot have it” to people who want it. At some point, someone has to tell the patient they cannot have whatever it is they want or need. . . .
• The Second Truth of Health Care: The current insurance model is just a wealth transfer from the middle-class to the health care industry, in order to cover the cost of poor people and the metastasizing layer of people who live off the system. Th[is] is really just a tax. Most people use about 5% of their plan for themselves; the rest is used to pay for poor people and the army of people who work in the system. . . .
• The Third Truth of Health Care: Health services are a massive skimming operation. Today, the one area of the economy that “grows” is the health care industry. Every year, more and more people pile into that wagon, mostly in administrative roles. The number of nurses and doctors does not grow very much, but the number of bureaucrats grows like a weed.

Then you have the pill makers, machine makers, research people and lawyers. There are always lots and lots of lawyers. The health care industry is massive and government dependent. It’s why rub rooms are now called message therapy centers. They are angling to get it on the racket, by having their service declared an essential health care service. . . .

The only cure Francis Menton sees at the moment is “a massive return to the states of responsibility for the healthcare issue. If this occurs, those states brave enough to return to consumers the individual responsibility for low dollar health expenses will see a clear competitive advantage over those states that indulge in the socialist illusion.”

Michael F. Cannon discusses the systemic implosion of Obamacare on FOX’s Happening Now