What's Wrong With This Picture?
By Harris Sherline
July 23, 2009
The arguments for and against a national health care plan continue to rage back and forth, left, right and center. We are being told it's an emergency, that if we don't act now, the economy will be devastated by out-of-control health care costs.
One of the most important lessons I learned in a business career that spanned over 50 years is when someone attempts to pressure you to buy or agree to something immediately, it is invariably the wrong thing to do. And, that's exactly what we have been getting from the Obama administration and those Congressional leaders or others who have been trying to push nationalized health care on the American people.
As the debate heated up, a stream of claims and counter-claims has been beamed at the public 24/7: It's "socialized medicine," it's government-run health care and that doesn't work wherever it's adopted, private health insurance will be forced out of the market, 47 million American's without health insurance can't wait any longer, people are dying, a "national health insurance exchange" is the only way to contain costs and improve the quality of care, people can keep the insurance they currently have if they prefer.
In a July 12 editorial, the Palm Beach Post noted that a study by the Commonwealth Fund concluded that a public plan that paid the same rates as Medicare would save $3 trillion in the decade from 2010 to 2020 compared with $1.2 trillion savings under a private-only plan. They also estimated that a public plan that pays Medicare rates would save $3 trillion in the decade from 2010 and 2020 compared with $1.2 trillion from the private-only plan. Commonwealth's projections indicated that a public plan also would reduce the number of uninsured from 48 million in 2009 to 4 million by 2012 and that without reform the number of uninsured would rise to at least 61 million by 2020.
Unfortunately, such projections invariably have a way of being wrong, no matter who makes them. Starting with Social Security in the 30s, every social program that has ever been adopted has ultimately cost far more than the estimates that were made when they were first proposed.
Is it any different today? That is, are the cost and savings projections that are being made to "sell" national health care to the public realistic or reliable? I think we can assume that without doubt they will prove to be wrong. The costs will be far greater than current projections and the savings we are being told can be achieved to pay for the program will prove to be grossly overstated or will never happen at all.
How about federal employees? How does their health insurance plan work? The Federal Employee Health Benefits Plan (FEHBP) is a private insurance program that is offered to all federal employees, including the President and members of Congress.
FEHBP is a system of "managed competition," through which more than 100 private insurance plans compete to insure federal employees. The plans stipulate which physicians the insured can see, which drugs can be prescribed, whether the insured can see a specialist, and when and where the insured can be hospitalized.
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