The Congressional Research Service, the non-partisan research arm of Congress, recently released a report showing government already controls approximately 60% of all health care spending. It was also revealed that Medicare, the government-run health insurance program for seniors, is the most frequent denier of medical claims, denying up to twice as many claims as private insurers. Also, due to their low reimbursement rate compared to private plans, nearly 30% of Medicare beneficiaries had trouble finding a primary care physician (PCP) to treat them. These facts call into question Democrat claims that government needs a greater role in the health care industry to reduce costs. In fact, one of the primary reasons health care spending and costs have risen so rapidly is because of sweeping government control that prevents competition and consumer choice.
Responding to this finding by CRS, Oklahoma Senator Tom Coburn said, “Defenders of the Reid bill say we need ‘reform’ to keep insurance companies honest. A better question should be: ‘Who’s going to keep the government honest?’”
In government there is no competition and there is no incentive to lower costs, hence the rapidly rising Medicare spending and the program’s impending bankruptcy within the decade. Congress could increase competition and immediately lower health care costs for the American people by doing two simple things, none of which require spending a single taxpayer dime: 1) allow consumers to purchase a health insurance plan across state lines, from anywhere in the United States; and 2) require medical care providers (e.g., hospitals, urgent care clinics, doctors, surgical centers, etc.) to post their prices online.
As it stands now, many health insurance companies benefit from a state-sponsored monopoly or oligopoly in several states. This limits competition among the insurers and limits consumer choice. Furthermore, and perhaps most detrimentally of all, patients have no idea what the cost of their medical treatment is until they receive the bill. It’s like going to Best Buy and purchasing a flat panel HD television without knowing the price, only to receive a bill from Best Buy two months later for $12,000. No market can work efficiently in such a manner. If health providers are forced to post their prices like almost every other industry does, health consumers can shop around and choose the cheapest, highest quality option available to them. This competition will serve to lower prices and enhance affordability, thereby allowing more low income Americans to obtain the medical care they need.
Of course those two measures won’t solve everything wrong with our health system, such as our perverse fee-for-service payment structure. It will, however, go a long way in lowering costs. But if government keeps intruding into the market, after already gaining a 60% market share with wasteful programs, the problems of health spending and inflationary costs will only worsen as consumer choice is sacrificed on the altar of political survival.
