Worse, since patients do not negotiate price, they don't care what the price is and have no incentive to seek out a provider with a lower one. On the other hand, they have every incentive to take health risks they couldn't otherwise afford and use services they might not otherwise be willing to pay for. There is a similar incentive for providers to charge for things covered by Medicare and Medicaid and do those things as rapidly as possible, whether or not that is what the art of medicine indicates would be the best treatment. So price – the most effective way to allocate scarce resources - isn't determined by negotiation but rather by politics, (as has already been demonstrated by Obama’s back room deals) which invariably leads to shortages and rationing.
And what of the huge cost savings that Obama promises will magically appear under reform with the same perverse incentives?
According to the National Center for Policy Analysis, “Medicare's total unfunded liability is more than five times larger than that of Social Security.” In fact, the new Medicare prescription drug benefit enacted in 2006 (Part D) has proven to be twice as much as the original congressional budget office estimates and alone adds some $17 trillion to the projected Medicare shortfall - an amount greater than all of Social Security's unfunded obligations.” The liability for Medicaid is off the charts because unlike Medicare Medicaid has no “trust fund” but is paid for by the states with matching grants from the fed. I can’t speak for you, but I am overflowing with confidence that a government takeover of healthcare is just the ticket to solve our fiscal problems.
The reform the new left is attempting to force upon us is the wrong kind of reform. It will not bring down costs, it will not improve the overall health of Americans and it will not encourage innovation and entrepreneurship. What it will do is dramatically increase the number of Americans dependant upon government for their medical care and their livelihoods. That may be a good way to build a political base, but it ain’t reform.
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