Healthcare: A Case Study in Free Market Solutions

In the 2016 presidential election, a variety of issues were highlighted by candidates, from combatting terrorism to bringing jobs back to America. One issue, health care, had one of the more varied sets of approaches proposed to fix it. On the left side of the aisle, Senator Bernie Sanders and former Secretary of State Hillary Clinton advocated for a totally new, government-run,  single payer health care system and a revised version of the system of the Affordable Care Act (Obamacare) respectively. To the right, Senators Rand Paul and Ted Cruz argued for a full repeal of Obamacare legislation whilst the now President Donald Trump advocated a repeal of most of the legislation while keeping the pre-existing conditions policy and changing some other insurance regulation. Out of these many proposals, the option most consistent with conservative thought and methodology is the complete repeal of the Affordable Care Act, accompanied by reforms to other regulations on the insurance industry. To fix the broken health care system in America, three things must be done. First, competition among doctors and insurance companies must be increased to decrease costs and increase quality. Second, insurance should be disconnected from employment to prevent issues with preexisting conditions when changing jobs. Finally, the government should play as little a part as possible in regulating and/or running health care and insurance to increase personal freedom and accessibility while decreasing taxation.

Arguably, the main issue with the implementation of the Affordable Care Act was the continual growth of the price of insurance premiums, as well as many insurance companies leaving partnerships with the program. The reason this phenomenon occurred before Obamacare and continued afterward is that there is simply nothing to keep the costs from going down. One basic principle of economics is that a product or service can only have beneficial values for two out of three factors: price, quality, and service. For example, a service widely provided for a low price will have a low quality, a high quality and widely available service will have a high price, and a high quality and low price service will not be widely available. Obamacare and other policies such as Medicaid and Medicare have increased the availability of the high-quality health care services of this country, resulting in skyrocketing prices. Unfortunately, these prices must be paid by not only the patients but also taxpayers whose money is the real capital funding the system. Since doctors have dedicated customers with essentially limitless funds, they are able to use extremely expensive procedures without much personal repercussion. However, this continual trend will make it impossible to fund these medical programs in the future, unless the government caps prices, which will cause a lowering in the quality or ready availability of medical procedures. For example, in the UK, their health system takes approximately 18 weeks to process treatment requests. In Canada, pets are treated with more urgency and more advanced procedures than people. Additionally, Leaders and other wealthy residents of countries with socialized medicine, from Italy to Spain, frequently travel to the United States to receive high-quality instantaneous care due to our system that is not yet devoid of free market competition.

To halt the rising costs of healthcare in the United States, there are a number of regulatory reforms that are necessary. First, repealing Obamacare is a must, as this would take care of the problem of forced insurance of all Americans that is funded by taxpayer money and results in skyrocketing costs. Additionally, a removal of the provisions preventing competition between insurance across state lines would lower rates. Currently, business group insurance coverage plans receive generous tax credits, and if these were removed and given instead to individual insurance or health savings plans, the patients will have more direct interactions with doctors, increasing price awareness and creating a climate to foster responsible medical spending decisions. Another action to be taken is to remove the restriction on what insurance companies must provide to patients, as this drives up costs by forcing the preparation of treatments and programs for people who most likely will never need them. The increase in private insurance plans and health savings accounts unconnected with employment also helps address the problem of pre-existing conditions. Today, if a person loses their job and insurance, develops an illness, and tries to get new insurance with new employment, they have no option but to pay exorbitant premiums. If private insurance or health savings were at a person’s disposal regardless of employment, this situation would never occur. To help protect those whose insurance providers seek to end their contract if they develop an illness, the laws regarding contract nullification should be toughened and people need to be educated about their rights regarding binding legal agreements.

A final point in favor of free-market instead of centrally planned health care is a philosophical one. Throughout his campaign, Senator Bernie Sanders frequently said that health care is a human right. This seemingly innocent and pragmatic statement oft-spoken by the more progressive members of society has grave implications. All other human rights in the U.S. Constitution, such as the right to bear arms, the right to property, and the right to religious freedom, entitle persons self-determination of their own behaviors, personal ownership, and afford them protection from government powers as long as their actions do not violate the rights of others. Health care is unlike any of these rights as it is necessarily a set of services provided by other free individuals. If it were to be considered as a “human right,” then this would imply that persons in medical distress are entitled to the assistance of doctors. This violates the freedom of medical practitioners, essentially binding them to a state of slavery to those who have the “right to health care.” To myself and other conservatives, the moral implications of a “right to health care”, the inefficiency of government health systems around the world, and the alarming increase of medical costs in the United States all point to free-market health care reform and the rejection of government controlled health care. It is difficult to reach this level of nuance in uninformed conversation about health policy that occurs far too often in politics, the media, and casual conversation. Only through thoughtful deliberation will the state of health care in the United States and the world improve.

Sources:

https://www.cato.org/publications/commentary/what-do-about-preexisting-conditions

http://reason.com/archives/2017/03/29/free-market-care/

Price, Quality, or Service: Pick Two

http://www.ncsl.org/research/health/health-insurance-premiums.aspx