Dr. Jack Cassell is a urologist in Florida. Just recently, he put the following notice on his Mount Dora practice:
“If you voted for Obama, seek urologic care elsewhere. Changes to your healthcare begin right now, not in four years.”
Cassell told reporters that he wasn’t refusing care to patients; he wanted only to educate them on how the new healthcare takeover would affect them:
I came across the timeline for implementation of Obamacare and I got a little discouraged when I got to next year when I found that most of the ancillary services and nursing homes and diagnostic imaging, all these things start to fade away,” he told Fox News’ Neil Cavuto. “And I felt that my patients really need to know about this. And the more I thought about it, the angrier I got until I finally felt like I’m going to put a little splash page on my front door and just get people thinking a little bit.
As it turns out, Doctor Cassell — and I applaud you for your efforts and think that every doctor in the country should go on strike right now, this very moment, to show that their lives and their labor are their own and do not in any belong to the state or to other people — there’s a painfully simple way to demonstrate how and why urologic care, like all healthcare, is not a right:
Rights by definition are immutable and timeless. They apply as much to humans now — and for the same reasons — as they did to humans five or ten thousand years ago. If healthcare is a right, then, where was your right to a heart transplant 200 years ago?
Where is your right to be completely cured of cancer today?
Where is your right to kidney dialysis if there are no kidney dialysis machines?
Where is your right to medical care if there are no doctors anywhere near you because young people are no longer studying the science of medicine, since to be a doctor means to be a slave to the state?
The 2000-plus-page ObamaCare legislation would of course obliterate any remnants of free-market medicine that still exists in this country, and in so doing it would not lower the cost of medicine, nor would it improve medical quality, nor would it ultimately insure more people, as the democrats themselves admit. The reason American medicine is so expensive in the first place is because of the massive bureaucratic apparatus that has gripped the American medical industry — an apparatus that was initially put in place in the mid-1930’s, under FDR and his horrific tax discrimination laws (which created employer-sponsored healthcare), and then expanded drastically in the 1960’s under LBJ.
The obvious question, then, is this: if government intervention created the problem, how is more government intervention going to help?
Answer: it’s not.
In fact, it’s going to compound the problem astronomically.
The following, however, which comes to us via Richard E. Ralston, Executive Director of Americans for Free Choice in Medicine, would help solve the problem, and it would do so without the unconstitutional coercive measures ObamaCare explicitly endorses.
Seven Simple Rules for Health Care Reform
The first simple rule: Make all medical services, insurance and personal savings for such expenses exempt from all federal, state and local income and payroll taxes. Those who complain about the cost of medical care and insurance must be confronted with the fact that if we cannot afford medical care, we surely cannot afford to pay taxes on the money we set aside for it.
The second simple rule: Allow an individual or corporate tax deduction equal to double the value of the service for all charity care by medical care providers. At one time America had a vigorous network of private charity care, which was largely destroyed by the government barging in. We need to restore that environment of private charity, which was more efficient, effective and compassionate.
The third simple rule: Pass legislation now proposed in the U.S. Congress that would give every individual or business the ability to purchase insurance in a national market, from insurance companies in any state. That would allow for ownership of health insurance that is more affordable and can follow individuals from job to job and state to state. The increased competition between insurance companies would restrain the cost of insurance.
The fourth simple rule: Allow the purchase of basic health insurance with high deductibles and low premiums that covers major illness or injury and annual exams, in conjunction with tax-free accounts for out-of-pocket expenses, such as deductibles. That, more than anything, would make insurance premiums more affordable for Americans who fear the financial consequences of health misfortune.
The fifth simple rule: Broaden the availability of optional coverage provided by Medicare Advantage, but allow for additional tax-deductible premiums to be paid by those seniors who elect such options. More choices from more options should be available to retirees—but not paid for by taxpayers. This would allow for expanded and more efficient coverage, and reintroduce an element of competition to those who seek to provide health care to seniors.
The sixth simple rule: Allow Medicare patients to utilize their Health Savings Accounts to pay for services from their Medicare physicians. This could bring thousands of doctors back into the Medicare program overnight and eliminate the ridiculous and unjust prohibition on those who want to spend their own money on their medical care.
The seventh simple rule: Limit non-economic or punitive damages in all malpractice or other litigation against medical providers or drug and medical equipment firms to a maximum of $250,000 (indexed for inflation). This would wring the bonanza for a few law firms out of the current ocean of litigation—and the high cost of “defensive medicine” now practiced by providers as protection against such legal extortion. The effect would be a reduction in the cost of medical care and insurance for everyone.
For more on the atrocity exhibition of cradle-to-grave healthcare, please read Dr. Yuri N. Maltsev’s account of socialized medicine in Russia. Dr. Maltsev was for many years an economist for Mikhail Gorbachev’s economic reform team. He now teaches economics at Carthage College, in Kenosha, Wisconsin.
Read also medical doctor Paul Hsieh’s limpid explanation of how ObamaCare will prevent good doctors like him from upholding their Hippocratic Oath.
What is now termed modern medicine actually began in the early 1920s when science — in particular, germ theory — culminated to a point that sickness and disease were at last being treated reliably.
It was then that doctors and hospitals got much better at the business of saving lives. This more highly developed service and expertise raised the value of their work, and they charged accordingly for their increased skill and labor.
And that, really, is when the situation started: when lives can be saved and health can be gained because of developments in technology, everyone suddenly believes that it’s his or her right to have that thing.
We see the same principle at work in, for example, the platitude “No one should go hungry when Americans are throwing away food.”
The error in both cases is the fraudulent notion that survival should be assured. This notion neglects the singular fact that abundance and technology are produced — and produced, moreover, by individuals.
No one has the right to the life and labor (i.e. production) of any individual, including the life and labor of doctors.
An easy way to demonstrate this truth is by asking the following: where was that right before these goods and services were produced or invented?
It is a fact that American medicine is already 50 percent socialized.
It is also a fact that there’s a clear correlation between rising healthcare costs and the socialization of medicine in this country. More government intervention will only compound the problem.
In the 1920s, when advancing healthcare became more expensive (though still very reasonable), the administrator of Baylor Hospital in Dallas, one Dr. Justin Ford Kimball, created a system called Blue Cross. The Blues (so-called) were nonprofit health insurers. They served local organizations like the Rebeccas and the Elks Club, and — please pay attention — they kept their premiums low in exchange for tax breaks.
Tax breaks are one of the main components to our current healthcare crisis. They’re what initially created the problem.
Blue Cross, you see, was successful only because of these tax breaks. Up until then, commercial insurers had always regarded medicine as a mediocre market, and therefore commercial insurers didn’t deal too much in medicine. But when commercial insurers saw that the Blues were making money, it convinced them to enter the medical field. This was not a problem, at first — until the 1940s, when private insurers increased their efforts to get around wartime wage controls, thus:
During World War II, Franklin Delano Roosevelt’s price-and-wage people, who didn’t generally permit wage increases or price increases (regardless of market forces) sanctioned a form of tax discrimination: specifically, they allowed employers to pay for employee medical insurance with pretax dollars.
This quickly became one of the few ways employers could attract new and better employees, since FDR had actually mandated that employers were no longer permitted to pay out higher wages. (How this ridiculous idea came about is another story, for another time.)
To this day, those who get employer-financed healthcare are purchasing their healthcare coverage with pretax dollars. On the other hand, those who buy their own healthcare are purchasing it with after-tax dollars.
This is a much bigger issue than you might at first realize.
As far as the employer was (initially) concerned, this wasn’t any different from additional labor costs — which is to say, medical insurance was not, from the employers perspective, any different from a rise in wages, and yet FDR’s price-and-wage control people did not at all see it as a wage increase. They therefore allowed it, which may seem surprising in light of FDR’s desire to control the entire economy.
Likewise, the IRS bureaucrats under FDR did not regard this maneuver as a wage increase, and for this reason they didn’t slap a tax on it. Neither did the employees see it as a real raise in wages — a fact that is singular to how this whole horrible precedent was set — because these costs are what economists call hidden costs.
The upshot: people didn’t and very often still don’t know that it is, after all, their own money paying for this prepaid medical coverage, and that medical coverage isn’t free.
In fact, health insurance today isn’t even really health insurance. It’s more properly called prepaid healthcare. But — and this is an another crux — it gives the appearance of being free or substantially free to the user, and it therefore substantially increases the demand for it and therefore its cost.
Of course, the root of this whole problem is the misbegotten notion that healthcare is not a good and service to be traded on the open market, but a right.
Let us remember what insurance actually is:
Insurance, properly defined, is what you purchase in order to avoid financial ruin in the case of a rare emergency.
Under the dangerous system FDR created, employees came to regard their healthcare coverage as a kind of blessed phenomena which came without cause or consequence. Quickly, this phenomena was absorbed into the working culture and as quickly was taken for granted: employees got used to receiving free goods, which goods, however, were not actually free. Employees just could not see that they were paying for them, and paying for them, furthermore, with pretax dollars.
A family in the bottom fifth of the income distribution pays about $450 more in taxes than insured families at the same income level. For families in the top fifth of the income distribution, the tax penalty is $1,780. On average, uninsured families pay about $1,018 more in federal taxes each year because they do not have employer-provided insurance. Collectively, the uninsured pay about $17.1 billion in extra taxes each year because they do not receive the same tax break as insured people with similar income. If state and local taxes are included, the extra taxes paid by the uninsured exceed $19 billion per year (“Are the uninsured freeloaders?” National Center for Policy Analysis, Brief Analysis No. 120).
Among other things, this illustrates again why entitlements are such a deadly precedent: once they’re entrenched, it’s virtually impossible to retrogress. Why? Because people acclimate to entitlements and in no time cannot imagine life without them.
Dr. Yuri Maltsev
Dr. Yuri N. Maltsev is an economist who teaches at Carthage College, Kenosha, Wisconsin. Prior to that, for many years, he was an economist for Mikhail Gorbachev’s economic reform team. In 1989, he defected to the United States of America. Dr. Maltsev, having lived the opposite, is now among the most articulate defenders of laissez-faire.
Just recently, Dr. Maltsev wrote a searing essay on socialized medicine Soviet style. He lived it firsthand for a number of years. His essay is an eye-popping read that’s liable to make you sick to your stomach.
Here’s an excerpt:
In 1918, the Soviet Union became the first country to promise universal “cradle-to-grave” healthcare coverage, to be accomplished through the complete socialization of medicine. The “right to health” became a “constitutional right” of Soviet citizens.
The proclaimed advantages of this system were that it would “reduce costs” and eliminate the “waste” that stemmed from “unnecessary duplication and parallelism” — i.e., competition.
These goals were similar to the ones declared by Mr. Obama and Ms. Pelosi — attractive and humane goals of universal coverage and low costs. What’s not to like?
The system had many decades to work, but widespread apathy and low quality of work paralyzed the healthcare system. In the depths of the socialist experiment, healthcare institutions in Russia were at least a hundred years behind the average US level. Moreover, the filth, odors, cats roaming the halls, drunken medical personnel, and absence of soap and cleaning supplies added to an overall impression of hopelessness and frustration that paralyzed the system. According to official Russian estimates, 78 percent of all AIDS victims in Russia contracted the virus through dirty needles or HIV-tainted blood in the state-run hospitals.
Irresponsibility, expressed by the popular Russian saying “They pretend they are paying us and we pretend we are working,” resulted in appalling quality of service, widespread corruption, and extensive loss of life. My friend, a famous neurosurgeon in today’s Russia, received a monthly salary of 150 rubles — one third of the average bus driver’s salary.
In order to receive minimal attention by doctors and nursing personnel, patients had to pay bribes. I even witnessed a case of a “nonpaying” patient who died trying to reach a lavatory at the end of the long corridor after brain surgery. Anesthesia was usually “not available” for abortions or minor ear, nose, throat, and skin surgeries. This was used as a means of extortion by unscrupulous medical bureaucrats.
“Slavery certainly ‘reduced costs’ of labor, ‘eliminated the waste’ of bargaining for wages, and avoided ‘unnecessary duplication and parallelism’.”
To improve the statistics concerning the numbers of people dying within the system, patients were routinely shoved out the door before taking their last breath.
Being a People’s Deputy in the Moscow region from 1987 to 1989, I received many complaints about criminal negligence, bribes taken by medical apparatchiks, drunken ambulance crews, and food poisoning in hospitals and child-care facilities. I recall the case of a fourteen-year-old girl from my district who died of acute nephritis in a Moscow hospital. She died because a doctor decided that it was better to save “precious” X-ray film (imported by the Soviets for hard currency) instead of double-checking his diagnosis. These X-rays would have disproven his diagnosis of neuropathic pain.
