Ron Morley's Freedom Blog

A libertarian health care plan?

The debate over health care reform is ongoing and no one is sure what type of changes will be forced upon the people by our guardians in Washington. With all of the smoke and noise that has been generated around this issue there is still nothing which one can point at and say, “This is what the Congress will be voting on”. In a quick scan of the field of likely contenders one sees the so-called “compromise” bill that has been put together by Senator Max Baucas (D-MT), who spent many hours with Republican Senators Olympia Snowe (R-ME), Chuck Grassley (R-IA), and Mike Enzi (R-WY), in an attempt to craft a "bipartisan" bill, and HR 3200 – sponsored by Representatives John Dingell (D-MI), Charlie Rangel (D-NY), and Harry Waxman (D-CA) among others (which gives the Statists everything they want, such as mandating the purchase of health insurance) – together with any number of proposed amendments, and other possible bills. Conspicuous by its absence in the debate is anything resembling a libertarian alternative to the extension of Federal power envisioned by all of the bills that are currently being discussed. And that is a real shame because this type of legislation is one in which a libertarian plan could be put forward.

A libertarian bill could use reducing the cost of health care as its point of departure. The sponsors of the other bills that are being considered all claim to reduce costs, but the reality is that what they really control, if anything, is the rate of increase in cost. For instance, President Obama's plan doesn't actually lower the amount of money that will be spent by the Medicare system, it merely slows the rate of growth of this voracious monster of a Federal boondoggle. Yet, to hear the President and his supporters tell the tale, one could be forgiven for thinking that the amount of Federal money spent on Medicare will decline if the President's plan is adopted.

A truly libertarian bill would lower the amount of money the Federal government must allocate to Medicare by removing the question from the Federal realm entirely. Now is the time when we should be truly thinking “outside the box” as everyone seems to be ready to discuss the supposed health care emergency (as some Democrats are portraying it) and actually do something about it. So here is my proposal for a libertarian alternative to the proposals being put forth by the proponents of Big Government:

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  • allow individuals to opt out of the Medicare system entirely,

  • do not collect Medicare taxes from those who opt out and reduce their Federal income taxes by the proportion that Medicare represents of the entire Federal budget,

  • allow those who opt out to do whatever they wish with their money; buy health insurance, go on a vacation, save it, it doesn't matter as it's their money to start with,

  • eliminate the Federal government's power to determine what equipment your local hospital can purchase, what services it may provide, and how much it may charge for the service thus interjecting an element of competition into the medical marketplace,

  • remove the cap on the number of doctors which may be graduated each year from the nation's medical schools. Making more doctors available will also add to the marketplace competition that serves to drive costs down in every other area of life in which it is allowed to operate,

  • require doctors, hospitals, labs, etc. to post their charges for common procedures. This could be done on-line, by mail, or via local newspapers, preferably all three. If people can see how much it will cost them to have their MRI down at Hospital “X” as opposed to Hospital “Y” they'll probably choose whichever one is less,

  • jettison the idea that in order to be “adequate” health insurance must cover every service, office visit, and lab test that a person gets. When I was a young adult (more years ago than I like to think about) the health policy I had covered major surgery, truly unusual and expensive tests, and other “catastrophic” costs. Other than that I had to pay for routine office visits, lab tests, and so forth. This would have the effect of lowering the costs of health insurance as companies would no longer have to offer only policies that offer “soup to nuts” coverage with the only difference in cost being the amount of the yearly deductible.

Now, I'm not going to claim that this will save “X” number of dollars from the Federal budget or that it will solve every aspect of the supposed health care crisis. But guess what, neither will any of the plans being put forth by the advocates of ever-larger government. What it would do is set a precedent for reducing the power of the Federal government, increasing the liberty of individual citizens, and giving those citizens some of their own money back. The idea here is to take a bite out of the power of the Federal government and help reduce the cost of health care, while demonstrating that people are capable of managing their own lives.

Taking steps to reintroduce competition into the medical marketplace is long overdue. For too long the AMA and the Federal government have had a cozy relationship which allows American doctors to avoid having to really compete for patients while also allowing the Federal government far too much regulatory power. It's been convenient for the medical professionals to maintain that they like the idea of competition, while regretting that they can't openly compete because the nasty Federal government won't allow them to do that. The above scheme would greatly reduce the Federal government's involvement in the medical marketplace without reducing the safety of the drugs, etc. that people rely on.

Would my plan be perfect? No, nothing involving people is ever going to be. However, my scheme gets us moving back in the direction of increasing the freedom of action of citizens, rather than further circumscribing it as the plans but forth by the politicians in Washington and the professional lobbyists hired by the health care providers would do. In the long run that's more important than coming up with a “perfect” plan which satisfies no one except those with a vested interest in increasing their power over others.