The Upcoming Healthcare Debacle


The Supremes are scheduled to rule before the end of the month on Obamacare.  If you read the punditry, the expectations are that some or all of it will be struck as unconstitutional.  That would not surprise.

But what also does not surprise is the duplicity of everyone in the political sphere on the actual root cause of the problems in the medical system, and our refusal to address them.  Witness this from the WSJ over the weekend:

In short, the GOP may be positioning itself to become the dog that caught the car. Political and policy uncertainty is perhaps inevitable given the range of what the Court could do. But the Republicans need a more coherent strategy, and more credible alternatives, to avoid reprising the payroll tax holiday debacle of last Christmas, except with generational consequences.

Republicans are down the line opposed to the individual mandate, but there’s an internal debate about what to do if the Court also overturns the main insurance regulations. A sizable cargo cult within the GOP wants to preserve some Affordable Care Act provisions and favors passing stand-alone bills reinstating them if necessary. The idea circulating is that the Republican Party should consider a “keep the good stuff” approach.

Uh, yeah.

Nobody (except for a few like myself) are talking about what really happened with Medical Care and why we’re here.  In brief (which I’ve explained at great length) the mess began with EMTALA, the Reagan-era law mandating that anyone who shows up with an “emergent” condition be treated irrespective of ability to pay, and we compounded the errors up and down the line by providing the medical industry in all its forms with “protections” that allow it to behave in ways that are unacceptable in any other line of business (and in many are flatly felonious.)


You can be provided a service without any idea what you will pay for it until after the fact.  This is especially true if you’re in duress (e.g. unconscious); in such a circumstance you will be later billed the maximum they think they can extract, sometimes 10, 20 or even 100 times what they would pay a government insurer for the same thing.

If your “debt” (after being billed 10x the rate paid by some other person) is then “forgiven”, you will be 1099’d for the difference as taxable income on an amount that the other party would have never paid in the first place.

You cannot buy a service that is billable only if the person alleging to provide you with help succeeds in doing so (would you accept a mechanic working on your car billing you if he failed to fix it?)

The medical industry has lobbied for and received “protection” from you going across a border and buying the very same drug or device made in an authentic manufacturer’s factory and bringing it back here for resale, thereby enforcing an artificial 2, 3 or 10-tier pricing mechanism that effectively forces you to pay 90% of the cost of a Canadian’s access to the same therapy.

The medical industry is “encouraged” to develop therapies for which there is no rational cost justification; as an example Dendreon’s Provenge provides an average 4.1 months of additional life to recipients yet it costs nearly $100,000.  That is, for every additional statistical year of life the price is $250,000 — to someone.  Were the “someone” each individual who received it there would likely be no market for this drug.  Yet it was developed “on the come” with the premise that government would pay (a large percentage of prostate cancer patients are Medicare) — that is, government would force everyone to fork up that which the average senior citizen would refuse to pay for himself.

The market is an excellent arbitrer of what is an “acceptable” cost for a given thing.  I would love to drive a Lamborghini.  I cannot rationally justify buying one, as the price does not convey to me sufficient value, in my view, to purchase, own and insure one.  Therefore I do not buy one and the market is constrained — there are few produced, as there are few people who have both the means and ability to purchase one.

But with health care it’s different.  The demand for “every breath I can draw” is of course nearly infinite.  Most people, if there is no material bar to the lengths they can go to extend their life, will spend as much of other people’s money as is possible.

The only means to stop this sort of thing is to bring back the market and accept mortality.  That is, we must accept that we are all born with a unique genetic make-up and some of us drew longer straws in that department than others.  We did so in intellectual capacity and, of course, health.  We are able to influence but not guarantee outcomes through our behavior.  All of this makes each of us unique.

The only sustainable position is that one’s unique gifts — or curses — when it comes to medical matters are things that one must deal with through their own resources.  This does not mean that we cannot help others through voluntary compassion; we both can and should.  But it does mean that “equality of result”, which in fact is the goal of socialization of medicine no matter how it is couched, is both doomed to failure and a relentless cause of ratcheting costs far beyond our ability to pay.

We have taken medical spending at the federal level alone from $53 billion in 1980 to $820 billion last year.  This is a 9.3% approximate rate of compounding.  At this rate of increase within 15 years medical spending will rise to $3.28 trillion 15 years from now — a time when most people who are 65 years and younger will live to see. 

The government cannot spend that amount of money as it doesn’t have it and can’t acquire it.  If we do not stop this here and now both government and private industry will collapse attempting to provide cost-shifted medical care “from cradle to grave, on demand, in any amount demanded” to everyone in the country.

We must both tell the truth about the lies we have put into the public sphere on this matter in the past and accept or mortality in the present and future.  There is, quite literally, no other choice.

I have written repeatedly on the specifics of how to address these problems in the health industry; you can find the compendium here— start with the oldest articles first.  Or, alternatively, pick up a copy of Leverage — the medical industry figures large within the book both in problems and solutions as it is one of the largest areas of distortion in our economy and one of the first and most-important we must address.

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