Presidential Speech on Health Care

He may not be succinct, but The President does deliver a good speech. As was true for his campaign for office, he articulated many positions most Americans can agree with. Who wants to see a woman denied coverage in the middle of her cancer treatments? Who doesn't agree that everybody should be able to obtain affordable health care? Who would object to a government run health plan that was completely self-funding, did not compete unfairly with the private sector, and only covered the poorest 5% among us? Who would not want all of those things and have it not cost any money? Who doesn't want there to be a Santa Clause?

The goals the President laid out Wednesday night are accepted by Democrats, Republicans and independents. The debate has always been about how to get there from here. He threw in something of an olive branch on torte reform, though it was either so vague, or I was so stupid that I'm not sure what exactly was being offered.

To continue to demand a government option in the face of the public opposition to it is either dogmatism, arrogance, or political expediency. Expediency being the least objectionable of the three. After all, if he can't get enough votes in his own party to support a bill without a public option, he can't get the bill. He did leave a crack in the door but it is a narrow one. Some think he insisted on the public option then threw it out. That is not the way it sounded to me, but we will see.

Libertarians will have a difficult time with the idea of compelling people to buy insurance. I am among them, but I am a libertarian with a small "L". I am practical too. There are likely three purposes for the mandatory insurance.

First of all, in practical terms everybody is insured now, since it is illegal to deny medical care to those in need. So those who are uninsured can show up in an emergency room and get taken care of without paying for it. So even these people are receiving a minimal level of care now and paying no premiums. Although they may see the doctor less often, when they do see one, it is under the most expensive circumstances.


The second purpose is likely the fact that in order to prohibit insurance companies from denying or canceling coverage, you have to deal with something called adverse selection. That is the tendency of healthy people to postpone buying insurance until they need it. That gaming of the system destroys the concept of insurance as a risk pool, where we all contribute now because we don't know who will need the pooled money (premiums) we have all contributed or when that money may be needed. If we allow people to do that I don't know how we are going to be able to keep premiums at an affordable level.

The third reason is related. That is the additional healthy insureds are a carrot to get the insurance companies to support the program. Thus, this provision may actually be a means to keep the government option out of the final bill because insuring everbody means lower premiums for everybody, thus keeping down health care costs. So I am conflicted about this provision of the plan. There are practical reasons to support it, but their are philosophical reasons to oppose it.



For the sake of brevity, I will only deal with these items for now, but there will be more to come.