Lets Look At Government Run Health Care
In this article from economicpolicyjournal titled, An Obamacare Designer Confesses: “How I Was Wrong About Obamacare”, we get to look into the mind of a bureaucratic central planner. Dr. Bob Kocher advised the President on Obamacare. In the article he said, “I was deeply committed to developing the best health-care reform we could to expand coverage, improve quality and bring down costs.”
Central planners think they can ignore the laws of economics by simple decree. Economic forces don’t listen to planners. These forces are consistently working trying to correct the plans of planners. How could the Dr. think you could expand coverage, improve quality and bring down costs? Increasing demand without increasing supply makes it impossible to lower costs. It’s simple economics.
THE ANSWER IS MORE CENTRAL PLANNING
Excerpt from the article: “Dr. Kocher, admits that he and the other central planners did not understand the market correctly. Despite Obamacare doing everything possible to push medical care in the direction of mega-operations, the small operators have proven to be most efficient and with the best quality service.”
So what is Dr. Kocher’s remedy to the problem? More central planning of the sector that is working. Excerpt from the article: “The man doesn’t get it. The hampered by regulation free market out did his planned medical care but instead of rejecting central planning of healthcare altogether and allow care to develop on its own on a free market, he wants to use a failed methodology, central planning, and apply it to the one sector that is succeeding because it has been free of such planning, with all sorts of new micromanaging of small providers.”
The Doctor is essentially telling his patient, the remedy for your concussion is to allow yourself to get hit in the head harder.
ANOTHER ONE BITES THE DUST
Who would have thought that when health insurance companies started to sell a product that was not insurance they would go bust? Obamacare wasn’t meant to succeed, it was meant to fail. Politicians figured insurance companies would get blamed which would pave the way for a Government single payer healthcare system.
In this article, Aetna Latest Insurer To Question Obamacare’s Future, we see the consequences of calling something insurance when it isn’t. Aetna will show a $3oo million loss this year on its Obamacare business. Economics tells us losses are bad and profits are good. These sustained losses tell the business owner his business isn’t viable. He should cut his losses and move on to something else. Profits tell the business owner that people value his activity and it should be continued.
Health insurance companies loosing money in Obamacare means the activity should be discontinued in order to stop wasting of resources. It’s that simple.
LETS LOOK AT THE CENTRALLY PLANNED V.A. HEALTHCARE SYSTEM
Two years ago Obama got rid of General Eric Shinseky as Secretary of Veterans Affairs. Bob McDonald replaced him. Problem solved, let’s move on to the next problem. Unfortunately they didn’t change the incentives the new Secretary had to make decisions under. If incentives didn’t change, the results won’t change.
Read this article titled, V.A. Spent Millions On Costly Art As Veterans Waited For Care. This headline doesn’t surprise us because we understand “incentives matter”. The underlying incentive for every government agency is to expand its power. Government agencies shouldn’t be judge by the goals they wish to achieve. They have to be judged by the results they produce.
When Senator Joni Ernst offered an amendment to the Military Construction and Veterans Affairs and Related Agencies Appropriations Act (this makes a terrible acronym MCAVARAAA) to specifically prohibit funding for art work (click on article here), it wasn’t even taken up, let alone adopted. This went down to defeat with a Republican controlled Senate!
The V.A. is an example of government run healthcare that has been around longer than Obamacare. If our Republican politicians won’t even change the incentives for something this obvious, what makes us think they will change or repeal Obamcare if they control the House, the Senate and the Presidency?
Related Article – Incentives Matter, at austrianaddict.com.
Related Article – The Economics of Healthcare vs. The Right to Healthcare, at austrianaddict.com.
Related Article – The Reality Of Obamacare, Socialism in Installments, at austrianaddict.com.
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