There are a few important points to take from this Wall Street Journal article.
1. Sebelius says, “In many areas in the country, the private market is monopolized by one carrier.” This is misleading. The McCarran-Ferguson Act of 1945 allows state governments to regulate the business of health insurance. While “monopolies” may exist in many markets, it is not because of lack of competition; in actuality, the over regulation of an industry prevents small start-up firms from competing. Instead of implementing a massive new government program which will cost billions, if not trillions of dollars, law-makers could rescind the McCarran-Ferguson act and open up markets to free-market competition.
2. Ms. Sebelius says “A new public health insurance plan would benefit consumers by …holding down costs.” Historically, public health insurance has failed to curb cost growth. Both federal health plans–Medicaid and Medicare–experience cost growth similar to private sector cost growth.
Over 16% of the U.S. GDP is spent on health care, double the amount of other industrialized countries. Implementing a new government health insurance program does not seem like a viable method of providing health care. A new insurance program would likely result in healthy individuals–the majority of the population–paying for the less healthy. Additionally, if an individual is not responsible for their own health care costs–i.e. they get free health care on tax-payer’s dollars–there is little incentive to use services wisely.
Fooling citizens into believing the only avenue for health care reform is through the federal government is treacherous policy. There are many free-market options which promise to lower costs; Health Savings Accounts, HMOs, and Regulatory reform are a few such solutions. Additionally, America needs to rethink the way it provides care. Reform focused on preventive medicine and public health campaigns could reduce unnecessary surgeries.
The problems are many, but the best course is to engage in a robust discussion about all the options. Misleading the public into expanding the federal bureaucracy unnecessarily is dishonest.