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Health Care, the Jobless Recovery, and Rationed Care

Filed under: Economics,Health Care — DRJ @ 6:17 pm

[Guest post by DRJ]

William A. Jacobson convincingly argues Democratic health care legislation will raise costs for private health insurance (he explains why at the link) and make a jobless recovery more likely:

“The Democratic proposals seem designed to raise the cost of private insurance. This will have two effects. The first is job destruction. The proposals mandate that employers, other than the smallest employers, provide “acceptable” health coverage. In this one fell swoop, the Democrats have increased the cost of hiring or keeping employees. Anyone who has run a business (I have, Obama has not) will understand that raising the cost of an employee results in fewer employees.
The second effect of raising private health insurance costs will be to force companies to make the economic choice of paying the health care tax rather than providing private health coverage. This will mean pushing the nation towards a single-payer system (Obama’s stated goal) subsidized not by general tax revenues but by employer health care taxes.”

Jacobson concludes this will create even “greater incentives to shift employment resources to other countries, where there are no such costs.”

In addition, in the short-term, there will be more health care consumers but no comparable increase in health care providers. As a result, providers will be forced to ration health care. Physicians will have more demands and less time to spend with patients, so they will focus more on health care management instead of treatment. Physician’s assistants, nurse practitioners, and nurses will provide more screening, triage, and care. I’m not saying these are bad choices. My point is there won’t be a choice.

So Democratic health care means higher costs, fewer jobs and fewer choices, but we’ll all be in the same boat (except for some lawmakers). And that’s the point, isn’t it?


25 Responses to “Health Care, the Jobless Recovery, and Rationed Care”

  1. Higher prices, fewer choices, pressures on jobs, and rationing.

    Doesn’t sound like what Obama and the Democrats have been promising but it’s been there all along and they don’t want to face it or you to focus on it.

    Obama’s famous “Let’s have an honest debate” mantra means just swallow what he says without question. If you actually poke around, you’re going to notice things such as those pointed out in this post.

    daleyrocks (718861)

  2. Dr. John Ratey and Edward Hallowell talk about this in the final chapter of “Answers to Distraction”. The poison of trying to treat patients without connecting to them psychologically. They are addressing ADHD in particular, but I see no reason that it’s not a general poison. Trust is important to care, and being treated like an object doesn’t engender feelings of trust in me, at least.

    htom (412a17)

  3. All Obama’s dirty socialist plans for government encroachment into the private sector are just encouragement for more companies to redomesticate overseas. Fool does not see that.

    daleyrocks (718861)

  4. he’s no fool*: they are doing this on purpose.

    *he undoubtedly is, but the people controlling him aren’t.

    redc1c4 (fb8750)

  5. The problem with hi-tax/hi-regulatory environment is not only does it hurt incentive it increases the benefits to gaming the system.

    As a friend told me about accounting in South America — the number 1 profit center is tax cheating.

    As O’Lunatic keep heaping more junk on the trunk, medium to small businesses will simply “make the money disappear.”

    HeavenSent (01a566)

  6. Death panels anyone?

    My company would fold if it had to pay for the insurance of all employed there. Period.

    Jenn of the Jungle (1bc2c5)

  7. Heaven Sent said –

    “As a friend told me about accounting in South America — the number 1 profit center is tax cheating.”

    This bears repeating.

    How much of this bill did Rangle write?

    tyree (bf0ee2)

  8. I believe I said this before, but how can there not be “death panels?”

    I know, because they exist today. My mother was diagnosed with cancer and there was certainly a panel of cancer doctors who decided her treatment, along with her attending doctor.

    Fortunately, she was diagnosed early and, so far, her long-term prognosis is good.

    But, when my father had a stroke, there also was another panel of doctors who reviewed the case, with the attending physician, and their conclusion was he had no hope.

    And, they were right. He died under hospice care.

    Extraordinary treatments could have kept him alive for a few months in a coma state, but the result would have been the same. Again, a panel of doctors experienced in his condition, with his attending physician, consulted and provided my family with an informed recommendation.

    I know a little bit about “death panels.”

    And, I will tell you this: I do not want federal government intervention in this type of consideration.

    And, no matter how its couched, no matter the platitudes, I can tell you, if we have government-run, universal health care, the government will, indeed be a part of life-and-death issues. You can call it anything you want, but there will be, ultimately, a government “death panel.”

    Mock Palin all you like, but she hit upon an issue that’s important to everyone who has a child or a parent.

    And some will come back and say the government only wants to help in deciding how someone copes with terminal illness.

    I’m sorry, but deciding what’s best for the life or death of a family member is too important for the government to assist.

    Ag80 (2a7a2a)

  9. You can’t say “Jobless Recovery” because from what I read over at CNN Money, it’s not a recovery until the jobs start coming back. Not that CNN would move the goalposts to help a Democrat, would they?

    SomeOtherSteve (238ed0)

  10. A good example is the elimination of catastrophic coverage, which would not fit the definition of “acceptable” coverage under the pending proposals. This coverage provides for a high deductible so that the patient pays, say, the first $5000 of health care bills with the insurance kicking in after that point. The cost of this insurance is dramatically lower than coverage which kicks in at the first dollar, often in an amount greater than the deductible.

    This is particularly ironic, since this means that actual health “insurance” (a limitation on health costs, as opposed to prepaid health care) is now illegal.

    It is also exactly wrong. The solution to the medical cost spiral — which will NOT be solved by making it government run — is to return to the pure insurance model, with most all routine care out-of-pocket.

    Just imagine what car insurance would cost if all maintenance, repair and even detailing was covered. That’s where we are now with health care. And we are now about to outlaw the equivalent of car insurance that only covers accidents and liability.

    Kevin Murphy (3c3db0)

  11. Kevin, Thanks. The car insurance analogy is a good one.

    Gazzer (22ecdc)

  12. Jacobson’s is wrong to claim that “there could be innovative ways to make these provisions available as needed through national insurance markets with subsidized or pooled coverage for people with pre-existing medical conditions, without increasing the cost for everyone“.. and the proof is in the previous paragraph “There is no way to expand coverage provisions across the board without increasing costs“.

    No matter how creatively one tries, it is impossible to provide more services (whether it be through eliminating pre-existing conditions and lifetime coverage caps or providing coverage to the currently uninsured) at no extra charge… and the only question is whether those extra costs are going to be borne by higher premiums for those currently with coverage or through higher taxes paid by society as a whole.

    steve sturm (698d3f)

  13. It is also exactly wrong. The solution to the medical cost spiral — which will NOT be solved by making it government run — is to return to the pure insurance model, with most all routine care out-of-pocket.

    What about price controls?

    Would they not work as well?

    Michael Ejercito (6a1582)

  14. Is there any reason why none of the proposed reforms excludes sex offenders who are out of jail or prison?

    Michael Ejercito (6a1582)

  15. The next time that price controls work will be the first. IF you hold prices artificially low, at least one of two things happens: supply dries up, or everything goes to a black market. Usually both. Note that suppressing the black market does NOT increase supply at the state prices.

    See Soviet Union, Empty Stores of

    Kevin Murphy (3c3db0)

  16. Michael, are you proposing that paroled sex offenders not be allowed to get medical care? Are there any other groups you would deny care to?

    Note that the current system does not allow the State to prevent folks from getting care. Only their ability to pay does, and usually not even that. A state takeover of medial care would allow that, which is a MAIN REASON people oppose it.

    Do you view this as an upside?

    Kevin Murphy (3c3db0)

  17. It does seem like the administration is deliberatly killing the economy doesn’t it?
    I wonder why?
    What do they hope to gain?
    Certainly not a second term.

    firefirefire (81ecb9)

  18. Comment by firefirefire — 10/12/2009 @ 9:26 am
    I can answer that (he says as he dons his tinfoil hat):
    In the melieu inhabited by the LiC, the operating principle has always been
    “One Man, One Vote, One Time!”

    AD - RtR/OS! (f793c7)

  19. What about price controls?

    Would they not work as well?

    You could refer to Nixon’s experiment with price controls during the inflation – era 70’s, which were uniformly demonstrated to be absolutely disasterous for the economy. Simply put, they don’t work, and they never will.

    Dmac (5ddc52)

  20. Nor did they work in WW-2 (where RMN became familiar with them as a lawyer attached to the Navy with responsibility for overseeing price/wage controls on govt contractors); the explosion in inflation at the conclusion of the war as demand went through the roof way before manufacturers were able to switch back over to a civilian economy.
    As an aside: Just remember that the purpose of gasoline rationing during that war (America had abundant supplies of gasoline) was to cut-down the demand for tires (we had no natural supply of rubber) since virtually 100% of rubber supplies were soaked up by the war effort. Therefore, restrict driving, and the wear-and-tear upon tires, by restricting the supply of gasoline used to fuel automobiles.

    AD - RtR/OS! (f793c7)

  21. I was under the impression that another reason for the rubber shortage was that so much of the origination were in countries that were under the control of Japanese.

    Dmac (5ddc52)

  22. Michael, are you proposing that paroled sex offenders not be allowed to get medical care?

    They should be able to do so on their own dime .

    If they get sick, they should pay for their health care.

    If they get sick and can not pay for their health care, they should die.

    Michael Ejercito (6a1582)

  23. Add in the “cap and trade” legislation, and the bottom line is that the Democrats will destroy more jobs and keep unemployment at record high levels for years to come.

    SPQR (26be8b)

  24. Actually there have been studies of the various rationing and wage and price controls during WWII by economists that suggest that the controls were counter-productive and sapped America’s ability to produce war material significantly.

    SPQR (26be8b)

  25. Dmac…Yes, at the time synthetic rubber had not been developed to the point it could be used commercially, and the rubber in tires came mainly from Brazil, and the Dutch East-Indies and SE-Asia (those good old Michelin plantations in Laos, Cambodia, VietNam).
    So, what wasn’t cut off (Brazil and some sources in West Africa) was subject to interdiction by German subs. Rubber was a very scarce commodity – which, as always happens in war, spurred the chemists to new heights in developing synthetics to replace it.

    AD - RtR/OS! (48d3c8)

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