Tuesday, August 18, 2009

An Important Issue - Health Care Reform - Obama's Deception.

I very rarely comment about politics or public policy. Though I am inundated with news all day, being on the Internet constantly at work and at home, I form a general opinion by assimilating information without paying attention to the details. In other words it is not a scientific but rather an intuitive process.

The current health care debate in congress and the approach of both sides to pinpoint where the problem is and how to solve it has been very disappointing. I expect politicians in congress to be cynical. I see congress as a necessary evil and I have very little respect for our senators and congressmen. The president on the other hand is another story. With few exceptions (Jimmy Carter for one), I believe they are patriotic leaders who try to do their best for the country as a whole. I may not agree with their policies but I do not see them as cynical self serving politicians. When President Obama came into office, I had a lot of foreboding because of his stance towards Israel and Iran. Though I did not vote for him because of that, I thought he probably would be good for the country. He looks intelligent, is eloquent and has the capability to be a good leader. His Op-Ed article this Sunday in the NY Times however dispelled all illusions and his dishonesty or worse for a leader, creating a straw man and blaming the innocent, comes through loud and clear. Here is the article.

The President has cynically set up the insurance companies as the scapegoat for all that is wrong with the current system. He pays lip service to the problem of rising health care costs and proposes to legislate some form of cost control. As we know all these approaches will not work. Every time the government tries to outsmart and set limits to the free market, it falls flat on its face. Legislators don't have a chance against businessmen who will eventually find a loophole to circumvent whatever restriction is imposed. After all they are there to make money. To control the insurance companies he proposes government competition. Good luck! When was the last time a government entity managed itself well enough to be a long term competition to private enterprise? Look at the post office!

The problem with the President is that for some reason, which I suspect is not innocent, he ignores one of the major contributors to the elevated cost of health care in our country and that is malpractice insurance. See here for an overview. The cost of malpractice is very insidious. Think about the doctors, the hospitals, the drug companies and every other entity that supplies or has anything to do with the health care industry. Think about the direct cost such as insurance and the indirect cost such as unnecessary procedures just to insure that the provider is not sued. Addressing that issue by changing the law and disallowing any punitive payments, limiting compensation for error to what is necessary for the recovery of the injured patient, would drastically reduce that cost. It would bring down doctors and hospital bills dramatically and thus insurance costs. The free market will make sure that all these costs will find a rational level. When we compare the cost of health care in the USA to that in other countries, our higher cost, I am convinced is directly attributable to our malpractice law. Approaching the problem from that point of view would not interfere with the free market and the open system we are used to. It would affect the judicial system, which is where the government should be active. Free market and a fair justice system foster great economies. Leave the markets to its participants and afford them an attractive playing field by putting in place fair laws.

Some will argue that reducing the threat of malpractice would foster negligence and carelessness by health care providers. That to me is nonsense. A free market will take care of it if the information channels are open. The government could play a role in monitoring and publicizing outcomes at each provider. A provider will not afford too many mistakes. He would have no patients very fast.

Once cost have been brought down and insurance rates are now affordable, a much larger portion of the population will be able to afford purchasing insurance. The government then can step in by providing a safety net for the few who could not for whatever legitimate reason, afford it. Medicare and Medicaid costs would rapidly decline and maybe some of the savings could go towards closing the social security gap.

There is another issue that makes health care costs stay high and that is corruption. Hospitals in general are not the most efficient organizations and corruption is more common there then in other private businesses. I suspect that it has to do with the way hospitals are reimbursed which feeds into this practice. I will hopefully address it in a separate post.

The fact that Obama and both his supporters and opponents in congress have not brought this out, makes one wonder how much the interest of the US population, their constituents who they are supposed to represent , is the underlying reason of this debate. I cannot but feel that they are all cynical politicians who hopefully will be voted out of office at next election together with the disappointing President Obama.


  1. Of course they don't want tort reform, the lawyers give them a lot of money. It is all the same political moves. Everyone knows that tort reform would vastly decrease the cost for insurance, but that would also take away a lot of money from lawyers. Who do you think runs our government?

    The best way to see how tort reform saves money is to look at california and texas. After their state legislature passed the reforms the insurance cost was literally cut in half. Just goes to show ya.

  2. Whoah, David Guttmnn commenting on politics! What does this have to do with the Rambam?!

    My own opinion has always been that the "extreme Capitalim" of the Americans is not as productive as they mak it seem. They bash European healthcae systems, but they are much more reasonable and ethical; I mean, how can running a hospital like a business be "ethical". I think any amount of "Socialism" the current president brings to America and it's healthcare sysetem is a good thing.

  3. Try living in one of these countries. The only people that are satisfied are the ones that never got sick. Anyone who unfortunately did have the worse kinds of horror stories.
    Capitalism might have its problems, but lets face it, where would you rather live?

  4. Israel has a slightly more socialist system and it works fine. Anyway, Amrica's system works, for those who have money; it lets poorer people dioe in it's waiting rooms. It's just one of the myriads of evils that extreme (Republican) Capitalism brings...

  5. I was in Israel and trust me you are off the wall.
    The system is terribly broken. If Israel followed America's lead things would be a whole lot better. Plus, people still get treated without coverage in America. You might have a horror story or two, but trust me, socialized medicine has many more. Let me ask you a question, did you ever need medical care in Israel? Be honest, and I dont mean a cold.