Health Care Reform

Copyright  © 2009  CommStock Investments, Inc.
David Kruse
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The first three things that I want to see enacted in health care reform are competition, competition and more competition. I perceive the lack of competition as the root of all evil responsible for soaring health care costs.

     I think that we need to take our cue as to how to fix our health care system from the monkeys. National Public Radio (NPR) aired a story recently about how competition impacts the hierarchy in a community of monkeys. The pecking order is evident in the grooming practices of monkeys. The top monkeys of the clan are groomed by those at the bottom. The monkey at the bottom has to groom himself. Researchers taught the monkey at the bottom to open a jar of apples. That skill inflated his value within the clan sending his star soaring. He didn't have to groom other monkeys and other monkeys were grooming him. He had the monopoly on the skill of opening the jar of apples and the rest of the monkeys rewarded him for it. Researchers trained a second monkey to open the jar of apples which caused the group to revalue the skill of apple jar opening so that the first monkey's reward of grooming was reduced by half.

     Competition lowers the cost of what the group believed was a valuable skill. The health care industry operates as local and regional monopolies and their monopoly of something we value is making monkeys out of all of us. My family pays its own health insurance premiums which are extremely burdensome, providing coverage limited by waivers and exclusions. We have searched for other companies who could open apple jars for us but have found a resounding lack of competition severely limiting our options to health insurance to that mandated by the state. We are forced to keep grooming the monkey with the monopoly that's providing our health care.

     We need more monkeys that can provide health care competing with each other in order to bring the cost down. That condition and that condition alone, the lack of competition, is the primary reason the health care system is consuming our wealth. Universal health care coverage is an idealistic, lofty objective when the country can afford it. The U.S. has no cash. It will either pay for new health care spending by raising taxes or borrowing. Either will depress economic growth and further undermine economic stability which will soon become apparent as the economy weakens again in 2010. Restoring economic stability is a more important priority than universal health care coverage.

     Issues such as the number of uninsured, or the need to subsidize health care insurance are important to some but in my opinion, they are secondary. If competition brings down the cost of health care, the problems with access and affordability will ease, expanding the number of consumers that are covered. Health insurance companies should not like health care reform any more than the monkey who was benefiting from his monopoly opening the apple jar, liked seeing the level of grooming attention that he was receiving decline when other monkeys learned how to open apple jars too.

     The fact that the health insurance industry has not opposed the Democrats health care reform plan tells me that it's not the right plan. Obama simply taxes the wealthy to raise more money to groom the health insurance companies with. He increases their wealth so why would they oppose it. Health insurance companies are not struggling. They have become the 1000 pound gorilla that all the monkeys are lavishing their grooming attention upon.

     My health care reform bill would do two things. First, it would eliminate the anti-trust exemption given to the health care industry in 1945. I believe that anti-trust exemption is the root of all evil in the health care insurance market. "The McCarran-Ferguson Act gives states authority to regulate the insurance industry for anti-trust matters." There are states in which 90% of health insurance is controlled by one company. In other words, states aren't protecting competition between health insurance providers. They have been protecting a monopoly. Restricting the sale of health insurance across state lines has created regional monopolies that collectively create a grand health insurance monopoly. There is no justification for the health insurance industry anti-trust exemption. When my wife and I went out looking for competitive policies no wonder they didn't exist.

     Life insurance or property casualty insurance companies don't enjoy anti-trust exemptions. They compete. The only reason health insurance companies got this special treatment is that back in 1945 some lobbyist screwed the monkey stealing all the apples. The second part of my health care reform bill would be to create a public option that competes in the market the very same way the Farm Credit System (FCS) competes in the ag credit industry. I totally disagree with the contention of many that we are better off having some private health insurance lackey decide if they will insure me or cover my claim than a government health insurance administrator. Private health insurance workers deny coverage to make the most money for the company they can. They tell doctors what treatment that they can provide by limiting what they will cover. The idea that a government administrator will do worse is absurd.

     My experience with private health insurance companies is that they have no qualms killing you whatsoever. I'll take my chance with the public administrator whose primary concern is providing health care not boosting quarterly profits. I do business with the FCS and if they're socialists then I like their kind of socialism. I get competitive interest rates and a dividend if they make money. Commercial banks hate the FCS just like insurance companies do the concept of a public health insurance entity...but the customers are better served by the competition created. The private ag lending industry is still thriving despite the competition given it by the FCS. Fear mongering that a public option will break health insurance companies is bunk. The FCS is an excellent example of how a public option benefits consumers and I believe that a similar entity could do the same thing to help bring competition to the health care industry.

     The USDA Farm Service Agency is another example of a government program administration. I would rate the performance of my local FSA above any private health insurance company that I have ever dealt with hands down. I would also note that many who decry the government getting into health insurance administration as often first in line to pick up their farm subsidy check. My local FSA is run in a manner that serves farmers covered by the programs and is administered very well.

     With my current private health insurance policy, I exist to groom them. I am sick and tired of grooming the health care industry and this monkey wants change. It's the lack of competition that is the reason why we are bankrupting this country to pay for health care. It's time we learn from our primate friends what the value of competition is.