Thursday, August 20, 2009

Stossel's Assumptions On Health care

John Stossel’s analysis of the president’s health care plan is missing some important concerns and his assumptions are incomplete.

I appreciate his acknowledgement of the scarcity of medical care. His basic economics is correct that as demand rises prices will likely rise as well. The assumption misses the possibility that there is already demand for and consumption of medical care by the currently uninsured that helps to drives medical cost up. It is not as if the uninsured will be entering the market for health care for the first time. They will enter it in a more efficient method as opposed to the emergency room door.

As Stossel agrees with most reasonable people that the government is not actively trying to kill people with “death panels” so why is rationing an issue. Why shouldn't scarce resources be rationed or prioritized? We currently try to ration medical resources such as vaccines. We prioritize older people and younger people to be vaccinated for flu primarily because we have a scarcity of vaccines and some people are more vulnerable.

As it has been pointed out before is insurance company rationing more desirable?

The market place for medical services for people with insurance is weird. Stossel is correct that there is a "principal-agent problem." As you enter the doctor’s examination room are you the consumer of the medical services. I don’t think so. You are the consumer of health insurance but the insurance company is the consumer of the health care since they are the ones paying the doctor. Or at least that is what Stossel leads to believe. I think he is correct but why would a government payer make this problem worse.

I now that Stossel’s concern is for self-determination. Does the current health insurance structure give people the opportunity for self-determination after the purchase of the policy? Does a public option do any less? For real self-determinative system we would need to undo all insurance and make health care fee for service. You only get it if you can pay for it.

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