A Whimper, Not a Bang

Carol Platt Liebau
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Posted: Jun 25, 2009 12:09 PM

ABC's infomercial for Obamacare drew only anemic ratings; that could have been either because the American public knows a fixed game when it sees one (no opposing points of view allowed!), or because there is growing fatigue with "all Obama, all the time."

One falsehood that should be quickly contradicted is Obama's misleading statements about a government option's ability to "cut costs," reported by ABC as follows:

The president rebuffed [the argument that a government plan would have an unfair competitive advantage against the private sector], arguing that "we can set up a public option where they're collecting premiums just like any private insurer and doctors can collect rates," but because the public plan will have lower administrative costs "we can keep them [private insurance companies] honest."

Obama said he didn't understand those advocates of the free market who constantly say the private sector can do things better and are yet worried about this plan.

Question: When, ever, did the government -- unionized and upwardly funded into perpetuity -- ever have lower administrative costs than the private sector?  Please.  If you believe that, I'll best you're also best friends with the Tooth Fairy.

But Obama's answer is disingenuous more generally. 

Government does have an unfair advantage over the private sector -- Medicare and Medicaid don't pay health costs as dictated by the market.  Rather, the government arbitrarily sets the rates at which health care providers will be reimbursed by the government.  Those rates regularly fall short of the actual cost of the services provided -- and the difference is made up in part by those of us with private insurance paying a little more.

As a recent column of mine noted, if an under-paying government option is created, it will kill private competitors because it won't have truly have to compete; it will simply pay what it wants -- a luxury private insurers won't have.  Costs for those of us with private insurance will grow so prohibitive that pretty soon, private options will be gone.

And once a government program -- not paying what it costs -- exists but there are no more Americans covered by private insurance to help subsidize it, there will only be one way left to balance the demand for services and the supply of them: Government-mandated (and controlled) rationing.

Interestingly, the President declined to commit himself and his own family to the tender care of the government option.  No doubt many will criticize him for that.  But I don't fault him for that at all; like him, I would do whatever I could to get the best care for myself or my family.  Furthermore, in the real world (as opposed to utopia), it's naive to believe that there will ever be true levelling to the point where everyone will receive the same quality of care no matter who they are.

The question is by what criteria will one's quality of care be determined.  And what I do fault the President for is trying to take away a system that, at least, lets those who can pay to secure better care to do so.  If a "government option" is all there is, the health care market won't run on free enterprise principles.  It will run on government principles -- where only the politicians will get the kind of care that regular Americans, who are willing and able to pay for it, are now able to receive.

In short, the President's response made it clear that Obamacare will not end the reality that some will receive better health care than others.  Rather, it will simply mean that the politically connected -- rather than those able and willing to pay -- will have the advantage.  And that, to me, sounds more like a Soviet model than -- to use the President's own words -- a "uniquely American" one.