I was just looking at this article covering the various 2008 presidential candidates stances on IT-related issues. When I followed the links to their websites, however, most of them were talking about fixing our health care system with hardly passing mentions of things like Net Neutrality or improving high-speed Internet access and competition. Since they’re all so adamant about “fixing health care” I thought I’d share my opinion regarding one of these big “plans”…

One of the first sites I perused was John Edwards and it left me rather upset. John Edwards Health Care plan is so bad I just had to write about it. I had to let everyone know that it

• Will hurt the economy.
• Won’t reduce drug prices.
• Won’t reduce health care costs.
• Won’t reduce health insurance premiums.

• Promotes inequality in health care and especially will hurt the poor and the middle class.

  Here’s his plan (quoted from his website):

  1. Requiring businesses and other employers to either cover their employees or help finance their health insurance.
  2. Making insurance affordable by creating new tax credits, expanding Medicaid and SCHIP, reforming insurance laws, and taking innovative steps to contain health care costs.

1. Creating regional “Health Markets” to let every American share the bargaining power to purchase an affordable, high-quality health plan, increase choices among insurance plans, and cut costs for businesses offering insurance.

   Here’s why it is so awful:

2. Requiring employers to pay for employee health coverage will further increase health care pricing (and drug prices) by continuing to hide the real cost of health care in employees paychecks. It may also prevent them from opting out of bad plans and may restrict them to very limited drug coverage. Not only that, but it still leaves employers with the burden of paying more for their employees than their foreign competitors do; hurting the U.S. economy.
3. Tax credits are great, but why is health care spending taxable at all? If you pay for your health care through an HSA you’re already avoiding paying taxes on it. It is a stupid and unnecessary system that confuses taxpayers and puts them in the impossible position of trying to predict how much they’re going to spend on their health in any given year. Also, State Childrens Health Insurance Programs(SCHIP) are equally as dumb. Why is it OK to provide for the health of children but not for adults? “Sorry, you’re 18 now so you’ll have to pay the $30,000 yearly it costs to keep you alive on your own.” Are we really that cruel that at a certain age you’re left out in the cold? People seem to forget that there’s a HUGE gap between when you start working and when you can afford health care (if ever). Starting salaries are lower than ever.

1. It’s a fact: Every time you divide up health care costs, the more inefficient the system becomes. Is it OK that New York will get cheaper coverage than Kansas because it has richer residents and more people paying into the system (and thus, more negotiating power)? Regional coverage is a stupid idea. It should be national coverage. Think of all that bargaining power compared to say, Hawaii or South Dakota.

   There’s many ways to get every U.S. citizen covered, but some things must be implemented in order for it to work. Here’s the basics of how it needs to be done if we want it to work:

2. Employers can’t be paying for health insurance anymore. It makes it harder for them to compete with foreign businesses—none of which (in 1st-world countries) pay this cost. The U.S. is the only 1st-world country that doesn’t have universal healthcare.
3. You can’t allow people to supplement government health insurance with their own. What do I mean? Well, if the government negotiates to pay $3,000 for appendectomies but they actually cost $4,000, a person with supplemental insurance would pay a monthly premium so they wouldn’t have to pay that extra $1,000. It sounds great in theory, but the problem is that care providers will continually increase rates since they know that many people will have the supplemental coverage and their insurance company will pay the rest—the patient won’t get the bill and they won’t care. Sure, they might see the cost in a HIPAA form that’s mailed to them but if they don’t have to pay it, why should they care? The overall effect of allowing supplemental coverage is year-over-year ballooning of costs as providers increase costs to whatever the supplemental insurance will pay. Worse than that, people can still be denied supplemental coverage and some may not be able to afford it—you’d end up with a system that is more inefficient and at a higher cost than it is today!

1. There has to be a single payer for the whole country and everyone who can must pay into the pot. The more people that pay, the lower the premiums will be and the better the bargaining chip for the single payer. If people can opt out of paying into the system, it will not only hurt people on the “government plan”, it will hurt people on private plans as well. Why? Because the more payers there are the more inefficient (and expensive) the system becomes. It is the complete opposite of how you’d expect capitalism to work because there’s no competition on price—only quality of care¹.

   Everything else regarding universal healthcare is a matter of, “What should we cover?” and “How much are we willing to pay?” Any government system will need to be tweaked and refined over time and I have no doubt that at its onset there will be problems with whatever is implemented. However, this should be expected and should not be used as a reason to do away with it.

   ¹ In order capitalism to work you must have businesses competing on both cost and quality. In the few choices that patients have regarding care, they will always choose the best available since the insurance will pay regardless of the price. Not only that, but information regarding care providers is extremely scarce and requires expertise of the highest level to discern who’s good and who’s bad at what.