Errors of Enchantment

I'll give him credit, John R. Hall, writing in today's Albuquerque Journal, knows how to push people's buttons in support of universal health care. His argument goes something like this: Obama supports it, doctors support it, the American people support it. The only ones who don't support "universal" health care are the big, nasty insurance and drug companies, not to mention the media. Oh, and by the way, our current health care system is killing us and our babies and free market capitalism is a failure.

Hall has his polling data correct as far as I can tell. Of course, if enough people sell a given product (even socialized health care!) as a cure for all our problems, large numbers of people will begin to believe. Especially when they never see the drawbacks to the system they are being sold. But, Hall is flat out wrong when he says "America's statistics on life expectancy and infant mortality are approaching Third World standards." According to this table, we are on par with Ireland, Denmark, Finland, and several other decidedly 1st world nations when it comes to life expectancy and our infant mortality is rate is far better than third world nations, especially when you account for the fact that there are significant differences in the way the nations collect this data which make the US look worse than it really is.

But these two data sets are largely irrelevant when it comes to socialized medicine and the system proposed by Mr. Hall. Can capitalism work in health care? Hall argues that it cannot, but he does not provide a single shred of data as to how socialized medicine will improve our current system. We at the Rio Grande Foundation always provide real, specific, market-based solutions to our problems.

Socialized medicine's advocates seem to think that the government has magical powers to allocate resources in an ideal manner that will make everyone happy and will do this all in a more efficient manner than exists now -- or could possibly exist were we to pursue market-based reforms. Fortunately, even Obama realizes that reality is in conflict with that fantasy. Hopefully political reality finishes the job in killing a drastic move towards further socialization of our health care.

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Professor Allen Parkman is a Professor of Management at University of New Mexico. In a recently-published opinion piece that appeared in the Albuquerque Journal, he explains in simple, clear detail, why health care costs have spiraled out of control over the years. As he puts it with regards to Obama's proposed reform of our health care sector, "History suggests that any cost reductions will be hard to obtain and expanded coverage will be very expensive."

Parkman rightly points to the tax treatment of health care and how it influences consumer behavior as the single most-important flaw with America's health care system:

On closer scrutiny, the problems with this industry should be viewed differently, as purchases of health care are often inefficient with unnecessary transaction costs. Let me explain. They can be inefficient because consumers are not exposed to the true cost of the services they are receiving and, consequently, the benefits may not justify the costs. In addition, there are unnecessary costs associated with each transaction. In contrast to a simple credit card purchase at a grocery store, health care expenses covered by insurance require additional paperwork for the provider and then administrative scrutiny from the insurance company.

Both of these problems exist because of the inappropriate use of insurance with regard to health care. Normally, we buy insurance to convert uncertainty into certainty. For example, we pay a predictable premium for fire insurance with the understanding that we will be reimbursed if our house burns down. We have converted an uncertain event (the burning of our house) into a predictable event (a premium and reimbursement if there is a fire). Fire insurance is fairly inexpensive — because it is seldom used.

As Parkman concludes, "With more realistic prices, some of the problems facing the working uninsured will be reduced. There still may be a role for the government providing catastrophic coverage for those individuals and families...real health care reform does not come from promising cost reductions and expanding coverage. It comes from making processes more efficient."

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All too often, those who want to increase the amount of regulations and level of government in the health care sector are considered to be "reformers," a term generally associated with improving on the flaws of a current, broken system. Several recent articles and letters appeared in the West Side edition of the Albuquerque Journal arguing on behalf of such policies. In my response to these big-government advocates, I argue that moving toward a free market in health care would represent a set of "reforms" that is far more likely to address the flaws inherent in our current system.

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There have been several opinion pieces in the Albuquerque Journal recently on the issue of health care (such as this one from New Mexico Sen. Jeff Bingaman or this one). That is why it was so refreshing to see this article in today's paper from a doctor who explains why nationalized health care is doomed to failure.

Writes Dr. Torre Near:

We, as individuals, can do more to improve our lives, but the way the current system is set-up, we have no incentive. The person who exercises every day, is in the normal weight range, doesn't smoke, has less than two drinks a day and sees a doctor once every two years pays the same as the person who is fat, smokes, drinks, (who's) exercise is working the remote and (who) sees the doctor every two weeks and is in the ER four times a year.

It doesn't make sense. We have to change the system, and a national health care plan won't do that. There have to be incentives to be healthy, just like there are incentives in car insurance to buy a lower cost car, avoid tickets and stay out of accidents.

While the specifics recommended by Dr. Near are somewhat lacking in specifics, there are plenty of ideas in New Mexico and nationally. Hopefully, Congress will kill proposals for government-run or socialized health care and then focus on recommendations that increase individual freedom and personal responsibility in health care.

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New Mexico Sen. Jeff Bingaman, the only member of the Senate who will have a seat on both committees that are dealing with President Obama's health care reform plan (Finance and Health, Education, Labor, and Pensions), had an article in Sunday's Albuquerque Journal in which he laid out what he sees as some of the problems of our current health care system and solutions that he and his Democratic allies in Washington would recommend. So, what of the Bingaman plan? I'll cite passages and analyze below:

1) "Health care costs are out of control because our system rewards more care, not better care." Sure, resources in our current system are not allocated in an optimal manner, but Hayek pointed out the information problem more than 60 years ago. Will government do a better job at allocating resources than our current system under which more than 50 percent of health care spending is already done by the government?

2) "Uninsured rates are high, especially in New Mexico." So, how about reducing mandates or allowing consumers to purchase care across state lines?

3) "We must clearly define what a basic insurance plan must cover. We must also end the practice of insurance companies denying coverage for pre-existing conditions." I'm not sure where Bingaman gets off telling the rest of us what kind of health insurance options we should be able to choose from, but that mentality seems to pervade Washington and has for years. If I'm a college kid who wants just a catastrophic policy, is that "acceptable?" How about health savings accounts? Also, "guaranteed issue" will dramatically increase prices.

4) "Part of reform is making sure younger and healthier people are buying coverage." Of course, guaranteed issue will force these younger, healthier people to subsidize those who take less good care of themselves and are older. How do you force these people into the system and is it really fair?

5) "The bill we send to Congress should shift us from a system that emphasizes 'sick care' to one that emphasizes prevention." Of course this is a good idea. Perhaps if we deregulated the system so doctors and patients could contract with each other as one doctor tried in New York, we could achieve some of these laudable goals, but with insurance companies playing such an outsized role, this is not going to happen under any of the plans now under consideration.

6) Bingaman then argues for "Evidence-Based Medicine" but Twila Brase has demolished the case for that particular form of social control under which doctors are nothing more than assembly-line workers taking orders from the state.

7) Lastly, Bingaman argues that we need a "public option" to compete with private health insurance. This simply means that we will move quickly to fully socialized medicine over time. After all, government, subsidized with taxpayer dollars, does not "compete" on an even playing field with industry. Like Fannie Mae and Freddie Mac, the taxpayer-subsidized option has many advantages and will ultimately "crowd out" the competition.

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Yesterday's Windsor Star (Canada) had this article about a young man with cancer and his struggle to get treatment. Among other problems, the patient, Mark Hunt, had to travel four hours to Buffalo rather than Detroit which is right across the river from Canada. Notice, of course, that his only treatment options are in the USA. Big surprise there since Canada's socialized medical system makes the cost of developing and offering innovative, high-cost treatments too high.

Hopefully our Congressional delegation takes stories like these into account when discussing and voting on President Obama's "public option" for government-run health care.

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It looks more and more likely every day that Obama will make a serious push this summer and fall for his government-managed health care "reforms." Recently, I blogged on health care as a pro-life issue. The powerpoint discussion I used during the presentation is now posted online.

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Despite the drumbeat out of Washington from the media and special interests, a recent poll conducted by NPR, the Kaiser Family Foundation and the Harvard School of Public Health, shows that Americans don't trust the federal government to improve America's health care system. An article about the poll results can be accessed here.

The most important finding is that 57% of Americans have little or no faith in "a panel of experts appointed by the federal government to make recommendations on which tests and treatments insurance should pay for." Given all the focus on the federal government as that solution to our problems, it is heartening to know that Americans are not blindly following those who would lead them down the primrose path towards socialized medicine.

In fact, many of the worst health care problems we face nationally and in New Mexico are the direct result of current government policies. Does anyone really think that the government which manages the Post Office, failing schools, and so many other areas of the economy that are not achieving their potential.

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Recently, I discussed health care policy at the statewide New Mexico Right to Life Meeting. While the Rio Grande Foundation does not take positions on abortion or other "life" issues, we are supportive of life broadly-speaking in the sense that socialists tend to view the earth's resources as being strictly limited with various groups battling over an ever-dwindling piece of the pie. Combining that attitude with the inevitable need to reduce costs in the ongoing push for socialized medicine, it is not a big leap to euthanasia and other anti-life policies.

Here are a few "pro-life" reasons to support free-market health care reform:

-- Government will control who lives/dies and who receives treatment. Decisions will be based on political calculations, not concern for human life;
-- It stifles innovation and the creation of new drugs and treatments, through the Food and Drug Administration “Evidence-based medicine;”
-- It sucks – and will suck even more – resources from all of us, thus taking more of your life from you and especially your children/grandchildren.

At the conference I presented this compilation of socialized medicine horror stories from around the world. Also, bioethicistWesley J. Smith presented his thoughts on the current debate over the push in some circles to blur the line between humans and animals. A fascinating day indeed.

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While some of Governor Richardson's harmful health care proposals -- guranteed issue and mandates that insurance companies spend 85 percent of their premiums on actual treatments -- to name just a few went nowhere once during this legislative session.

Thankfully, legislation passed and the governor has signed HB 438, legislation that demands co-pays from Medicaid recipients who have incomes above certain levels and use emergency room services unnecessarily. While the HB 438">fiscal impact report fails to come to a conclusion regarding the cost or cost savings associated with the legislation, it seems hard to believe that the effort will not save money. After all, emergency room trips are very expensive and if you are receiving taxpayer-financed care, these co-pays can at least cause people to think twice before an unnecessary emergency room visit.

Kudos to House Minority Whip Keith Gardner for this successful effort.

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In today's Albuquerque Journal, economist Micha Gisser (a senior fellow w/ RGF), discusses a few ways in which our health care system might be reformed with an emphasis on both free markets and "universal" health care. The basic idea of Swiss health care is to generally free Americans of some of the most absurd and silly regulations -- by allowing, for example, individuals to receive the same tax benefits as their employers do and by purchasing care across state lines -- and to demand that each American purchase a very basic plan to cover emergencies.

Gisser makes many good points in his column. Given the choice between the Swiss model and what Obama is proposing, I'd certainly go for the Swiss model. There are a few major questions before we impose the Swiss model here: 1) how do we ensure that everyone has health care and enforce that? After all America is a much bigger, more open society than Switzerland 2) How do we ensure that bureaucrats and politicians don't demand larger and more ambitious "basic" coverage as happened in Massachusetts with its "connector" plan?

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One of the most frustrating aspects of working in public policy is the vast number of policy advocates out there who advocate undertaking policies on behalf of some public good (like attracting more doctors to New Mexico), but fail to realize that their preferred policies, if enacted, would have the exact opposite effect from what they advocate and wish. One recent example of this is the policies advocated by Frank G. Hesse, M.D., Chairman of New Mexico's Health Policy Commission who wrote about the need for more doctors in New Mexico in the Albuquerque Journal.

While going through all the dire numbers about the absence of doctors, dentists, and other providers in New Mexico, he concludes saying, "There is a great hope that a universal health insurance program will be adopted, improving health care." This sentence certainly made me do a double take. As we pointed out in a policy paper, "Governor Richardson’s Health Care Plan:
Enslaving Physicians and Destroying Private Health Care" which analyzed Governor Richardson's original "universal" health care proposal, his plan contained price controls, including strict controls placed on doctors' salaries, which would simply chase more providers out of state.

It is true that a socialized health care scheme enacted on a national basis might not have the immediate impact such a plan would have were it enacted in New Mexico only, but it seems hard to believe that working for the federal government is an attractive option for most doctors and those students now exploring making a costly investment in medical school.

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It never ceases to amaze me how frequently articles get published in the Albuquerque Journal on particular issues with little or nothing in the way of empirical evidence for that particular point of view. You may disagree with the Rio Grande Foundation perspective, but at least we back up our arguments with facts and examples rather than mere conjecture. The article, "Health-Care Reform the Best Stimulus," which appeared in the paper on Monday is a perfect example.

The article approaches the health care issue in a rather conventional way talking about the cost of care and the number of uninsured, but that's about it as far as the problems and causes of our current health care system are concerned. A quote from President Obama is then trotted out:

"Obama himself has acknowledged the need to reform health care and invest in publicly funded programs to help alleviate the financial crisis. "The time has come — this year, in this new administration — to modernize our health-care system for the 21st century; to reduce costs for families and businesses; and to finally provide affordable, accessible health care for every American." He added that health reform, "has to be interwoven into our economic recovery program...This can't be put off because we're in an emergency. This is part of the emergency!"

But that's it. The authors recommend that New Mexico create a supposedly "independent" Health Care Authority as the solution, but make no mention of the exact policies that would save money and insure larger numbers of New Mexicans (or Americans for that matter). Rather than empowering an authority imbued with mythical powers and the ability to remain independent of political considerations despite the fact that literally billions of dollars are at stake, here are some real solutions for our health care problems that, if adopted, would improve our health care system.

Of course, the authors of the article give no specifics about how their plan would stimulate the economy, but at least our proposed solutions are limited to health care, not solving our entire economic situation.

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Recantly, the Albuquerque Journal, New Mexico's largest newspaper, included a letter to the editor from a reader who decried the "failure" of our "free market" health care system. To anyone famililar even in passing with American health care, this concept of a freewheeling, un-regulated health care marketplace might seem to be in stark contrast to the heavily-regulated system now in place.

I pointed out these simple facts in a published response to the letter which can be found below:

In a letter to the editor, Richard Mason recently labeled our health care system “an unregulated free market.” He argued that legislation introduced in the 2008 legislative session that would have created a New Mexico Health Care Authority that Mason argues would solve our problems. Unfortunately, he doesn’t explain exactly how this system would lower costs and improve access to care.

The assertion that our health care system is “free market” is baffling. I don’t have enough time and space to list all the ways in which government intervenes in health care, but here are a few of the big ones: Government spending via programs like Medicare and Medicaid to name just two, accounts for 46 percent of all health care spending. Federal tax policies favor third-party-purchased coverage by allowing employers to purchase coverage tax-free, thus taking cost decisions out of the hands of individuals. States also regulate care, thus piling on costly mandates. New Mexico has 51 of them.

On the supply side, licensing and other regulations enacted at the behest of the medical profession have constricted the supply of doctors and other health-care professionals. Many states also require “Certificate of Need” permission from the government prior to construction or expansion of certain health care facilities.

The fact is that while we don’t face a truly “socialized” health care system as seen in many other countries our health care system is not a “free” market. Before using government to “cure” our health care system, it would behoove all of us to become educated on the ways in which current government policies increase costs and reduce the availability of care.

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As I wrote about over the weekend, the so-called economic stimulus now being considered by the Senate is full of waste and pork. This kind of thing is to be expected any time Congress decides to start spending money on a wish list of projects that would otherwise not be funded. Of course, as the folks at the Cato Institute point out, most good economists will admit that artificial government-induced stimulus packages don't really work.

The stimulus bill would be bad enough if it just wasted money and stalled our economic recovery, but real, harmful policies are being foisted on the American people. One of the most troubling such policies is a provision that would essentially nationalize your medical records.(how this is an economic stimulus is beyond me, nevertheless...) According to the folks at the Institute for Health Freedom, the stimulus bill would require :

* "The utilization of an electronic health record for each person in the United States by 2014."

* "The National Coordinator shall perform the duties…consistent with the development of a nationwide health information technology infrastructure that allows for the electronic use and exchange of information and that…facilitates health and clinical research…"

The federal medical privacy rule promulgated under the Health Insurance Portability and Accountability Act of 1996 (HIPAA) already permits the disclosure of personal health information without patient consent for treatment, payment, and oversight of the healthcare system. The stimulus bill fails to restore patient consent, while at the same time, mandating electronic health records and facilitating the electronic exchange of every American's health information.

Regardless of the merits (or lack thereof) of electronic health records, your health information will no longer be your own under this plan. Since information is power, is it any stretch to say that this is the first step to nationalized health care?

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While much of the attention on health care has shifted to Washington and the Obama Administration, there is still action taking place in the states. Governor Richardson, having largely failed to impose his original vision of bureaucratically-managed health care on New Mexico, has revised his plans and come up with a new "streamlined" health care plan.

Richardson recently unveiled a series of health care bills that will be introduced during the 2009 session. Among the initiatives he has planned are:

It would require agencies that buy insurance for public employees and retirees to work more closely together to save money, but it would leave the agencies themselves in place;

Increase use of electronic medical records;

Require insurance companies to spend 85 percent of premiums on health care and restrict premium increases over time; and

implement "guaranteed issue" policies that would force insurance companies to insure individuals regardless of medical condition

First and foremost, while they sound like a great idea, forcing doctors to shift to electronic records is not a panacea for our health care system;

Unfortunately for us, Richardson seems hell-bent on increasing costs and degrading patients' ability to obtain coverage. Demanding that insurance companies spend 85 percent of their premium collections on patients simply reduces the incentives insurance companies have to appropriately administer coverage to their customers.

"Guaranteed issue" regulations are another bad idea. They have been found to increase the cost of insurance by 23 percent in the first year and 50 percent higher during the second. Increasing costs ultimately drive young and healthy people out of the marketplace.

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Rio Grande Foundation economists Brown and Gisser recently wrote an op-ed arguing that McCain's health care plan is superior to Obama's. That drew a swift response from a supporter of Obama who argued that McCain couldn't get health care under his own plan.

To sum up the author's arguments:

The real problem with the American health-care system is that it has become an industry designed primarily to profit the corporations who provide the "health-care" product. Some aspects of life are more important than profit — family, community and education, for example. Other aspects of life are actually necessities, health care being among them, and when it comes to necessities, profit has no place in the picture at all. Health care should be treated as a public service, not a for-profit business.

While it is certainly up for debate whether McCain has the plan we need to solve our health care problems, the idea that education and health care are "above profit" illustrates the basic ignorance of this argument. The fact is that in a world of scarce resources, the most efficient way to allocate them is through the profit motive. Under socialism, resources are simply allocated by the government, thus resulting in political allocation and greater scarcity (due to the lack of a profit motive).

Making a profit off of someone's misfortune or illness may sound like a dishonorable way to make a living, but this is what doctors do. It is also the best way to make people well.

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Recently, two Rio Grande Foundation economists, Ken Brown and Micha Gisser, had a column in the Albuquerque Journal discussing the health care plans of Obama and McCain. While Obama claims his plan will not lead to "socialized medicine," Gisser and Brown believe that his reliance on government will inevitably lead to a breakdown of the current system.

As far as McCain's plan is concerned, they say that it would:

McCain's plan is radical yet simple: It would offer every individual $2,500 and every family a $5,000 refundable tax credit to purchase health insurance. He would abolish the current tax code where employers purchase health insurance for their employees with pre-tax dollars. We can safely assume that his plan, while subsuming Medicaid, would leave Medicare intact.

For the poor, McCain's tax credit would be offered in the form of a negative income tax. Thus, McCain's plan is in fact a voucher extended to every citizen, from Bill Gates to the poorest person sleeping under a bridge. Allowing people to purchase health insurance across state lines, and overriding the hundreds of state-coverage mandates, will open up a huge national market for the tens of millions of voucher holders. At long last the spiraling cost of health care will level out.

McCain's plan likely is better, but I wonder, even if he gets elected, will Congressional Democrats go along? I don't think we'll get to find out.

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According to this recent report from the Albuquerque Journal's Business section (subscription required although a shorter free article is available here), New Mexico's State Coverage Insurance program has stopped enrolling new members at 40,000. This has occurred two years earlier than the government originally expected.

SCI is a funded through the federal SCHIP Program. The state pays $100 million per year on the program, approximately 1/4th of the total cost. New Mexico uses SCHIP, a program intended for children, to fund insurance for adults under a waiver that expires in 2010. Because New Mexico already has such generous Medicaid standards, the state couldn't find enough people to spend SCHIP money on, so, in their infinite wisdom, the program was expanded.

The result is that between an employer and employee, costs for insurance under SCI come to $110 per insured person, per month. The cost of the program to federal and state taxpayers is $400 million annually and $40,000 people are covered for a total cost of $10,000 per insured person. This leaves a total cost per insured person of $11,320 annually. Considering that my Health Savings account costs my employer a total of $3,600 annually, we the people are getting ripped off big-time. Don't you just love government programs? Couldn't we just give everyone who doesn't have insurance in New Mexico a fully-funded HSA and be done with it?

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With all the action and talk about the bailout, the health care issue has been moved off the front pages. Nonetheless, there is still discussion back and forth on the issue. Dr. Jim Tryon, a prominent New Mexico doctor who has advised Governor Richardson and others on health care reform, wrote on the topic in the Albuquerque Journal. In his article which can be found here he argues:

(Our) health care “system” is a non-system. Can you imagine running a $6 billion dollar enterprise without a chief executive and a board of directors? Without a governance structure there is no way to coordinate the business of health care. Without an empowered governance structure, special interests will continue to rule and protect their individual turf, and profit, at the expense of the whole.

Of course, the idea that health care should be a "system" seems like a fallacy to me. After all, a system sounds like something that the government would control from the top-down. Medicare and Medicaid are "systems," but those are not models we should adopt. We don't have a grocery system, but there is no problem getting food at your local supermarket.

Rather than creating a "system" -- even a more coherent one than exists now -- adopting reforms in order to free individuals and businesses from unwise government policies would be more sensible than forcing a top-down system on everyone. After all, the fact that so many involved in the health care debate exercise their power to say “No” is probably a good sign that widespread support for any single reform option is not there (thankfully). Maybe we can give greater freedom a try for a change?

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With Wall Street in crisis and so many issues sucking up airtime, health care as an issue has been pushed from the front pages of America's newspapers. Of course, Albuquerque's alternative weekly still has time to do a story about how our health care system is "poisoned." In fact, from the sound of things, American health care couldn't get any worse. But, if we've learned anything from the ongoing financial debacle, things can always get worse.

I point out as much in a follow-up letter to the editor. The fact is that our health care system does certain things very well:

Nearly 80 percent of global drug development occurs in the U.S., with only 16 percent coming from Europe. America also leads in high-tech treatments that draw people on waiting lists (or where treatments are simply unavailable) from Canada and the U.K. to get treatment in the U.S.

Before adopting policy changes for the simple sake of change, we need to carefully consider whether those changes will harm our ability to continue doing the things we do well and whether we'll really see improvements in those areas where our system struggles.

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After failing to gain either legislative or popular support for his ambitious, universal health care plan which would have relied heavily on government mandates, Governor Richardson has introduced a scaled-back health care reform proposal that will be considered in the upcoming special session.

The Governor’s plan would:

• Require all children through the age of 18 to have health care coverage from private or public sources. The bill contains no enforcement mechanism or penalty for parents who don’t secure coverage for their children.

• Appropriate $58 million to expand existing programs to reach an estimated 50,000 children who qualify for publicly funded coverage but don’t receive it. The additional spending would recur annually, Hyde said.

• Establish a new Health Care Benefits Administration to consolidate management of several existing public coverage programs, including state employee and public retiree insurance plans.

• Gradually limit premium increases insurance companies can charge small businesses from 20 percent today to 10 percent per year in five years.

• Require insurers to spend at least 85 percent of premiums on services and guarantee that anyone who needs insurance can get it regardless of health status.

• Establish privacy requirements for patients’ electronic medical records.

While this scaled-back proposal is a significant improvement over the Governor’s original if only because it is scaled back, legislators should still be skeptical as to whether the proposal, if passed, would result in any improvement in New Mexicans’ health care or uninsured rates.

Specifically, requiring that parents obtain health care for children through the age of 18 is bound to be ineffective as there is no enforcement mechanism, but this is actually a good thing. After all, responsible parents want their children to be covered, but not all parents are responsible and many others either can’t afford it or believe that putting food on the table and gas in their car to get to work is more important than health insurance for their children.

Spending $58 million to put more children who already qualify for government health care on government plans is also a poor option. Rather than spending $58 million every year for more welfare, how about giving parents an equivalent tax break to set up Health Savings Accounts for their children?

Regarding efforts to set up a Health Care Benefits Administration, limit premium increases, and set up arbitrary requirements for insurers, these are nothing more than means to further impose government control on the health care sector of New Mexico’s economy. New government agencies and micromanaging the insurance industry are not going to result in significant improvements in either the quality or availability of health care in this state.

The fact is that government policies are largely to blame for the current health care mess. Did you know that New Mexico charges the highest tax on insurance premiums in the nation (4.003%)? How about eliminating New Mexico’s gross receipts tax on deductibles and co-pays which are tax-exempt in almost all other states? This tax which in some places exceeds 8 percent in some areas of the state is applied to this ever-increasing area of health care expenses.

The aforementioned ideas are just a few ways in which the negative impact of current government policies could be mitigated. They would also be far more likely to succeed in expanding health care access to the greatest number of New Mexicans.

While the Governor should be applauded for scaling back his mandate-heavy original proposal, the Governor’s scaled-back proposal still moves us towards an increased government role in health care. Hopefully, legislators will again reject more government reliance and instead consider market-based reforms outlined above in the upcoming 2009 legislative session.

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Several months ago I wrote on this site about dog health care vs. human health care. John Goodman, one of the nation's free market health care analysts has picked up on that theme on his NCPA health blog. Check out his posting here.

As Goodman points out:

Why does the market for pet care seem to work so much better than the market for human care? Not that I pay a great deal of attention to such things, but I believe it's fair to say that:

* No one is saying the market for pet care is "broken" or in "crisis."
* No one is saying that the market cannot work for pet care.
* No one is calling for mandatory pet health insurance.
* No one is calling for single-payer health insurance for pets.

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"Universal," government-mandated health care may not become law in New Mexico during the upcoming special session, but that doesn't mean that it couldn't happen in the near future. Check out this video which illustrates in stark detail how health care might work if we put government in charge.

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A recent article from the Heartland Institute's Health Care News discusses a proposal by Rhode Island Gov. Don Carcieri (R) that would result in the state agreeing to a five-year federal spending cap on Medicaid in exchange for more autonomy over its Medicaid programs. The proposal is expected to save taxpayers $67 million.

Most states, like New Mexico, prefer to invest in creative ways to raid the federal treasury to fund their out-of-control Medicaid programs. Rhode Island is wisely attempting to take responsibility for managing a limited budget in the interests of their own citizens.

While it looks like Governor Richardson's health care plan will not progress in its entirety during the upcoming special session, his plan relies on a massive new Medicaid spending both nationally and by New Mexico. It would be nice if Richardson (or New Mexico's next governor) would take a close look at what Rhode Island is trying to do instead. After all, we can't live at others' expense forever.

Posted by Paul Gessing at 09:45 PM | Permalink | Comments (0) | TrackBacks (0)

In case you haven't heard, Governor Richardson has called for a special legislative session to begin on August 15. While the session was originally to be exclusively on the topic of health care, he has since broadened his agenda to include other issues including an economic stimulus known as the CARE Package.

It is certainly a good sign that the Governor seems to be backing off of imposing "universal" health care, but New Mexicans must be aware of the very real pitfalls associated with massive government intervention in the health care sector of our economy. Check out this informative website with interviews and discussion of some of the problems associated with government health care.

Posted by Paul Gessing at 05:21 PM | Permalink | Comments (0) | TrackBacks (0)

Japan has a single-payer health care system. While the Japanese people may be a healthy lot, they also must put up with some pretty absurd government rules and regulations. According to recent reports the Japanese government will now demand that people of that nation have their waists measured (the new state-prescribed limit for male waistlines is a strict 33 1/2 inches). If they are considered to be "too fat," the government will impose financial penalties on companies and local governments (and presumably people) that fail to meet specific targets.

As health care expert Paul Hsieh points out, such freedom-destroying regulations are the result of government payment for health care. After all:

Once a government starts violating individual rights by creating a "universal" health care system, this inevitably leads to further infringements of individual rights. This is not unique to Japan.

For instance, universal health care in Great Britain has led to infringements on the right to free speech. In 2007, the British government banned television stations from playing classic 1950's-era humorous advertisements encouraging people to have an egg for breakfast, on the grounds that "the ads do not encourage healthy eating".

When a government has to pay for everyone's health care, it will naturally demand a say in whether people are leading a "sufficiently healthy" lifestyle, as defined by the government.

If we allow the state of New Mexico or the federal government to control our health care, we will inevitably face similar intrusions on individual liberty. Bill Richardson of all people should be sensitive to this issue.

Posted by Paul Gessing at 04:02 PM | Permalink | Comments (0) | TrackBacks (0)

According to a story in this week's Albuquerque Alibi, UNM's Health Sciences Center which includes UNM Hospital and the medical school, has adopted new restrictions to eliminate drug advertising in the University's medical buildings. While those who see drug companies as evil subversives working to snooker doctors and their patients into purchasing their latest and greatest drug, it would seem that this is yet another effort by a University to stifle free speech.

After all, who is going to tell doctors what new drugs and treatment possibilities are out there? Are they supposed to hunt these treatments down on the internet? How about patients? Are drug companies' advertisements (also under attack by those who dislike the pharmaceuticals industry) now the only way they can find out about new treatments?

The fact is that if we had a health care system that functioned more like a market with consumers able to price various options (using a consumer-directed mechanism like an HSA) rather than being shielded from them by health insurance or government programs, the so-called "problem" with drug advertising would largely disappear. After all, if it is patients who decide whether to use a generic drug or the latest name brand drug, they should be able to use it since they are paying for it. In fact, opponents of drug advertising justify their position due to the higher cost associated with name-brand drugs.

Posted by Paul Gessing at 08:37 AM | Permalink | Comments (0) | TrackBacks (0)

As I've mentioned before on this blog, health care mandates are a big problem with increasing health care costs. Rarely is this issue discussed in the media, but George Will recently brought up the point with Stephen Colbert on health care and mandates (click here and fast-forward 2/3rds of the way through).

According to data compiled by the Council for Affordable Health Insurance, New Mexico has the 9th-highest mandate total (51) in the nation. Obviously, forcing people to buy a "premium" health insurance product if they are to buy any insurance at all is a big factor in giving the state the 2nd-highest-in-the-nation uninsured rate.

Posted by Paul Gessing at 04:19 PM | Permalink | Comments (0) | TrackBacks (0)

I wrote an article recently in the Albuquerque Journal about some important health care reforms taking place in Georgia. I love it when people respond to articles written by the Foundation because it shows we are having an impact and making people think.

Unfortunately, the response to my article came from Dan Davis of Los Lunas, a regular, left-wing letter-writer to the Journal. His response focuses on two points: 1) Georgia's law was passed by a Republican Legislature and signed by a Republican Governor 2) The American Cancer Society worries that high-deductible health plans make preventative treatment cost-prohibitive.

My response to Davis is two-fold: whether the law was passed by Republicans or Democrats is irrelevant. Political leaders of all stripes must be concerned with the state of American health care. Moving to a system under which costs are directly related to benefits is the only proven way to improve quality and cut costs simultaneously. Regarding the concerns expressed by the Cancer Society, consumer-driven health care plans have been on the cutting edge of efforts to improve patient quality. After all, it is much easier to convince the average person of the importance of their own health if you can attach dollar signs to healthier lifestyles.

Davis is a hard-core lefty and I don't expect to convince him, but hopefully other readers cut through his rhetoric.

Posted by Paul Gessing at 05:41 PM | Permalink | Comments (0) | TrackBacks (0)

This article appeared recently (May 28) in the Albuquerque Journal. The author's basic point is that Native Americans were promised health care paid for by the federal government and that the government has fallen short of its obligations. Of course, more money is essential (in the author's mind) to rectify this injustice.

This promise of a "right" to health care is strikingly similar to politicians' promise to "universal" health care and other plans to dramatically alter America's health care system. While more money may indeed be necessary to "fully" fund the Indian Health Care system, history has shown that government-run health services are very expensive and thus, by their nature, are ultimately "underfunded."

While the Indians undoubtedly had little choice in the wording of the "treaties" they signed with the US Government, their costly and ultimately sad experience with "free" health care should give so-called progressives pause when promoting the idea as a panacea for current problems.

Posted by Paul Gessing at 04:59 PM | Permalink | Comments (0) | TrackBacks (0)

A few weeks ago, I blogged on this page about the reforms Georgia has recently made to health care policies within its borders. Today, I wrote about these changes and urged New Mexico policymakers to follow suit, in the Business Journal section of the Albuquerque Journal. Check out the article here (no subscription required).

Posted by Paul Gessing at 08:25 PM | Permalink | Comments (0) | TrackBacks (0)

In 2006, Santa Fe County voters agreed to a tax increase to fund improved emergency medical services to outlying communities around the city of Santa Fe and throughout the county, according to Julie Ann Grimm of The Santa Fe New Mexican (911 Stretched Thin, May 20, 2008). So far, $6 million has been levied from county taxpayers and given to the county government for this purpose, but the county’s emergency needs still haven’t been met.

The county’s been having a problem with recruiting and retaining enough paramedics. If a county resident calls 911 because of a heart attack, there may not be enough county paramedics to respond. Odds are the city of Santa Fe, which has its own fire department and adequately staffed emergency response team, will have to send its own paramedic team to far off county lands, leaving the city more vulnerable to a shortage. The city and county medical employees try to work together to meet the needs of citizens.

Unfortunately, the city and county governments don’t cooperate in the same way. Santa Fe city residents (who are Santa Fe county residents as well) are helping to pay for services outside of the city, but their city government is actually contributing to the county shortage by offering more competitive wages to paramedics, leaving the county fire departments in need.

While this competition drives paramedic wages up, it almost seems that the County and City should combine rescue efforts so services do not overlay. Even better, the City and County would likely save even more up to 2/3rds of the money it spends now by privatizing some emergency medical services.

Posted by Corey Davis at 04:08 PM | Permalink | Comments (0) | TrackBacks (0)

You may have missed it unless you work in health care...in fact, I can almost guarantee it, but the State of New Mexico held a "Input Meeting" on New Mexico's Comprehensive Strategic Health Plan. Now, as an advocate of free markets and individual choice, the very concept of the government having a "comprehensive" plan for my health is distasteful and the idea that governments can even make decisions in a "strategic" fashion is a bad joke.

But, the meeting was held and I attended one of the panels on financing health care in Albuquerque. Not surprisingly, for a day-long meeting, nearly all of the attendees were either employed by government or work directly for a particular interest group. Average New Mexicans simply did not attend. More importantly -- and perhaps as a result of the self-interested attendees -- the primary topic of discussion was "what can government do for me?" Unfortunately, as long as the focus of health care reform is on government doing more rather than less, the problems in our health care "system" will worsen.

For a look at the framework on which discussion of the State's so-called strategic plan was based, check out the word document found here.

Posted by Paul Gessing at 12:29 PM | Permalink | Comments (0) | TrackBacks (0)

According to a new study, New Mexico ranks number one (worst in the nation) in deaths from falls for seniors. New Mexico ranked highest with 99.26 deaths per 100,000 people over the age of 65. Wisconsin was second at 87.35 deaths per 100,000 people over age 65 and Vermont came in third with 81.46. Alaska ranked the lowest, with 15.95 deaths. Medical treatment costs for falls involving people over age 65 were more than $19 billion in 2000, and that figure is projected to increase to more than $40 billion by 2020.

While the problem of seniors falling is certainly real and obviously expensive, the ability to prevent it and potential preventative measures are unclear. Certainly, it would seem that seniors should be aware of the problem and take steps to prevent or prepare for it.

Posted by Paul Gessing at 01:27 PM | Permalink | Comments (0) | TrackBacks (0)

Georgia Gov. Sonny Perdue recently signed legislation making High Deductible Health Plans paired (HDHP) with Health Savings Accounts (HSA) more affordable and available in that state.

An HDHP is a health insurance plan that offers consumers lower premiums and higher deductibles than a traditional health plan. HSAs allow consumers to set aside funds tax-free for future qualified medical health expenses.

The legislation exempts insurers from state premium taxes for the sale of high deductible health plans with a Health Savings Account, while allowing consumers to deduct from state income taxes an amount equal to premiums paid to a HSA plan. The new legislation will affect mostly the self-employed and small business employees by providing a $250 annual tax credit for small business employers that spend at least $250 annually to enroll their employers in an HSA plan.

If Governor Richardson and New Mexico's legislators are really concerned about reducing the number of uninsured in the state and improving access to health care, they should consider similar legislation.

Posted by Paul Gessing at 04:53 PM | Permalink | Comments (0) | TrackBacks (0)

Recently, the Albuquerque Journal contained a story with the headline "NM Ranks High on Health Care." Since I follow these issues closely and have a pretty good grasp on New Mexico's very real health care problems, I immediately took a closer look. What gave New Mexico such a positive ranking on health care?

The answer, if you can call it that, is contained in a recently-released study by the Trust for America's Health. According to this study, what New Mexico ranks high in is receiving funding from the federal Centers for Disease Control.

Of course, there is no correlation between CDC spending and health care outcomes, but as a Trust spokeswoman said, "New Mexico does well competing for federal health care dollars. Officials in New Mexico have been aggressive and successful in submitting grant requests."

So, while the Trust study claims that more federal funding is needed for disease prevention programs, New Mexico is having great success in accessing more than its share. Maybe the next time the Trust studies health care spending, it will take a look at whether all this money actually achieves intended results.

Posted by Paul Gessing at 09:22 AM | Permalink | Comments (0) | TrackBacks (0)

I have a great deal of respect for people who own and operate businesses in New Mexico. This a big-government state and the culture is not friendly to entrepreneurs. That said, a recent story (subscription required) from the Albuquerque Journal's Business Outlook section outlining a new health care plan being developed by business groups including the New Mexico Restaurant Association and the Association of Commerce and Industry.

Unfortunately, rather than supporting market-based reforms such as those proposed earlier this year by the Rio Grande Foundation, this supposedly "pro-business" coalition instead is arguing that the gross receipts tax (as opposed to taxes levied on employers) should fund the expansion of government health care plans. While the business coalition does at least stress the fact that, as Beverly McClure of ACI notes "about half of the state's uninsured already qualify for some kind of coverage or public program, and they still don't sign up." Nonetheless, if this coalition wanders down the path of higher taxation and bigger government, they are heading down the same path towards government-managed health care that Governor Richardson's failed plan did.

Rather than bigger government, New Mexico businesses must rally behind ideas like eliminating the gross receipts tax on health care, allowing individuals to purchase coverage across state lines, and reforming Medicaid (to name just a few ideas). These reforms -- unlike government programs -- will cut costs and increase coverage.

Posted by Paul Gessing at 09:50 AM | Permalink | Comments (0) | TrackBacks (0)

Socialists and government bureaucrats have a knack for framing policy discussions in terms of more or less socialism rather than emphasizing individual freedom. This has certainly been the case in the debate over health care. Now, the state wants input on a "Comprehensive Health Plan" and is holding meetings around the state to get public comments.

Certainly, those of us who understand how markets and individual freedom work will probably be turned off by the very concept of a "comprehensive" plan put forth with the state intimately involved in the process. After all, we'd rather have a dispersed and decentralized health care "system" in which individuals retain control over such important decisions. Nonetheless, if advocates of free markets and less government involvement in health care ignore such meetings, we have no excuse when the socialists make policies we don't like.

If you can't go to the meeting, you can offer your comments here.

Posted by Paul Gessing at 10:57 AM | Permalink | Comments (0) | TrackBacks (0)

The centerpiece of bureaucracy-based health care reform like the proposal Governor Richardson continues to push is "universal coverage." By this, advocates mean that if we all have health insurance then everyone will have access to health care. Sounds good enough even if the actual policy implications are a lot messier than they appear at first glance.

As I have written in the past, however, before governments embark upon dramatic "reforms," we should make sure that current policies are not unnecessarily hindering the ability of New Mexicans to access quality health care. One policy I just discovered that is undoubtedly making health insurance and health care less accessible than it should be is taxation. Specifically, taxation of insurance premiums. Simply put, if you tax something you get less of it; if you eliminate taxes on something, you'll get more of it.

Surprisingly enough, New Mexico levies a 4% tax on health insurance premiums! This means that for every $100 your employer or you pay for health insurance, the government gets $4. That doesn't seem very smart if "universal coverage" is the goal. Actually, the original tax was 3%, but back in 2004, the Legislature and Governor Richardson apparently decided that health insurance wasn't expensive enough, so they added a 1% surcharge.

Posted by Paul Gessing at 06:42 PM | Permalink | Comments (0) | TrackBacks (0)

In keeping with yesterday's posting on the abysmal state of education in this country, this story which discusses a poll on what "socialized medicine" means to a group of survey respondents caught my attention. Among the findings:

* 67% said they understood what "socialized medicine" meant;
* Of those, 79% said the term means that the government makes sure everyone has health insurance;
* Only 32% said it means that the government tells doctors what to do;
* Of those who said they understand the term, 45% said that if America had socialized medicine, the health care system would be better, while 39% said it would be worse.

The fact that 79% of those who thought they understood what "socialized medicine" means said that it meant that the government made sure everyone has health insurance is not unexpected, but the finding that only 32% understood that giving everyone health insurance also means that doctors would be forced to obey government dictates is unfortunate and a clear sign of economic ignorance.

Obviously, we at the Rio Grande Foundation oppose socialized medicine or anything like it with every fiber of our being, but if Americans are convinced to go along with such a scheme without understanding that government would quickly be inserted into every health care decision Americans make, they are buying a bill of goods. This is an educational burden and opportunity for free market advocates.

Posted by Paul Gessing at 04:12 PM | Permalink | Comments (0) | TrackBacks (0)

While most of the attention during New Mexico's recently-completed legislative session was on Governor Richardson's massive, government-managed health care proposal, apparently it wasn't the only health care reform considered during the session. In fact, Richardson just signed a new law that further regulates health insurance.

One provision in the law will make it more difficult for insurance companies to rescind coverage for people who develop serious medical conditions.

The cap on yearly medical services paid by health insurance policies offering certain minimum coverage also will increase from $50,000 to $100,000 under the new law. The higher limit starts next year.

Currently, an insurer can refuse to pay claims or rescind coverage if there were omissions or misstatements—sometimes even if inadvertent—about a person's medical condition or medical history in an insurance application.

That standard will change under the new law. Once a policy takes effect, insurers can deny claims or end coverage only if they show that an individual made "willful or fraudulent misstatements" in their application about a pre-existing medical condition.

Another change in the new law is to give people more time to obtain medical insurance after they lost coverage. It increases from 63 days to 95 days the "creditable coverage" period. That's the time in which a person without coverage receives credit for previously being insured.

While all of these policy matters may sound reasonable to the average citizen, each of these new regulations will further increase the cost of health insurance in New Mexico. Considering that Richardson is simultaneously working to mandate "universal coverage," it might seem odd that he would sign legislation to make insurance more costly. Unfortunately, it is perfectly consistent because the tendency is towards greater government involvement in all areas of health care.

Posted by Paul Gessing at 09:27 AM | Permalink | Comments (0) | TrackBacks (0)

New Mexico State Senator Dede Feldman (D-ABQ), one of the state's leaders on the health care issue, had an interesting opinion piece in the Albuquerque Journal on Thursday.

While her arguments don't necessarily hold together individually, she ultimately decides that "Democrats (who control the Legislature) should trust one another enough to roll up their sleeves...and draw on a basic common value: affordable, quality health-care should be accessible to everyone." Her arguments are worth analyzing.

1) Mandating that individuals purchase health care is key. While there will be "winners and losers in the short term, costs will ultimately be lowered for everyone." Unfortunately, the Senator is engaging in some wishful thinking here. Mitt Romney's reform in Massachusetts relied on an individual mandate that has failed to lower costs. Rather than winners and losers as Feldman hopes, we'll all lose with an individual mandate;

2) Regarding the concerns of other Democrats and their concerns about the ability of low-income New Mexicans to purchase insurance under an individual mandate, Feldman calls such questions "wonkish" and calls the loss of this mandate "regrettable." No solutions for this very real problem are offered;

3) Feldman's last important point is that there is "broad agreement among Democrats, but not Republicans" that health insurance companies should be forced to insure everyone and that 85 percent of insurance companies' revenues must be allocated to purchasing health care.

She credits the Richardson Administration for "getting the insurance companies to agree, at least partially," but she doesn't explain that the only reason the insurance companies are willing to go along with this in the first place is that since we'll all be forced to buy health insurance, those companies will have a captive market and will be able to charge whatever they wish. Since the insurance companies are "playing nice," they are assuming that they'll get favored treatment when it comes time for rate increases which will inevitably be subsidized heavily by taxpayers.

Feldman asks or at least mentions some of the key questions in the health care debate. Unfortunately, she seems to dismiss these concerns in an almost single-minded effort to obtain "universal coverage" for New Mexicans. If she gets her way, we'll not only be poorer, but we'll have fewer doctors in the state to treat us. We can't afford this "reform."

Posted by Paul Gessing at 10:37 AM | Permalink | Comments (0) | TrackBacks (0)

I recapped the results of Governor Richardson's efforts to impose a highly bureaucratized -- albeit not explicitly socialist -- health care proposal on New Mexico in National Review Online. While the story of the 2008 legislative session and the failure, at least to this point, of the Governor's proposal, is something that many New Mexicans are undoubtedly aware of, Richardson is still hoping to reappear on the national stage as a potential Vice Presidential candidate. The American (and New Mexicans who haven't been paying attention) people should at least be aware of what he's been up to recently.

Posted by Paul Gessing at 10:42 AM | Permalink | Comments (0) | TrackBacks (0)

By now, most of you are probably aware that Governor Richardson has called a special session in an attempt to get his health care bill passed. This was no surprise given the Governor's fixation on health care before the session began, but with little in the way of agreement on the issues, Richardson's move seems somewhat desperate. After all, even House Speaker Ben Lujan, D-Santa Fe, said of the prospects for a special session, "It won't be fruitful for the governor to call a special session if there is not mutual agreement."

This is the rub. The House which Richardson normally counts on for support didn't even go along with the Governor, but instead gutted the bill. The Senate is even further away from the Governor than that.

Crazy things can happen in a special session, but if legislators seemed skittish about reforming health care in a short, 30-day session, it seems even less likely that they'll go along with the Governor during a special session that is sure to be unpopular with legislators of both parties, particularly since they've already rejected his reforms once. Lashing out at those who don't go along with his wishes seems to be the Governor's current mode of operation. Only time will tell whether legislators cow-tow to the Governor.

Posted by Paul Gessing at 04:54 PM | Permalink | Comments (0) | TrackBacks (0)

Posted by Paul Gessing at 08:39 AM | Permalink | Comments (0) | TrackBacks (0)

As you probably know, the Rio Grande Foundation has been among the most prominent organizations opposed to more government intervention in the health care sector and supporting market-based reforms.

While most New Mexico businesses and business organizations have opposed Governor Richardson's plans for a massive new government-run health system, the Greater Albuquerque Chamber of Commerce came out in support of the Governor's plan. Recently, a group of businesses and other organizations including the Rio Grande Foundation sent a letter to the Chamber outlining concerns with the Chamber's support for even more government intervention in health care and the negative impact such policies would have on small businesses. Mario Burgos blogs about the issue here.

Posted by Paul Gessing at 11:30 AM | Permalink | Comments (0) | TrackBacks (0)

Way back when Congress was debating the tobacco settlement, opponents of the settlement, which amounted to government control over the tobacco industry, opponents argued that smokers saved governments money compared to what they would spend on end of life services for those who lived long, healthy lives.

That assertion has been borne out again in a recent study done in the UK which found that health care for those who are healthy and live the longest costs $417,000 from the age of 20 on while care for the obese was $371,000, and for smokers the cost was about $326,000. In other words, people with unhealthy habits actually consume less health care over their life-spans than those who are healthy. While this would be entirely irrelevant in a free country, government's massive role in health care makes it highly relevant.

The good news is that governments can no longer use taxpayers as an excuse for attempting to control our lives; it looks like some other excuses for the nanny-statists are in order.

Posted by Paul Gessing at 10:32 AM | Permalink | Comments (0) | TrackBacks (0)

Somewhat surprisingly given its usually reasonable editorial opinions, the Albuquerque Journal endorsed Governor Richardson's health care plan. After all, as the paper concluded, "New Mexico's condition can only get worse."

We've heard this before. Richardson, in his state of the state address, repeatedly implied that health care in New Mexico cannot get worse than it is now. For starters, he said, "the status quo is unacceptable" and he went on to state "The most expensive choice is to do nothing." While advocates of radical change in our health care system seem genuine in their conviction that things can get no worse, what are the facts?

Yes, New Mexico has a disproportionately high rate of uninsured with 400,000 out of 2 million (third highest in the nation). While it may seem plausible to state that health care could get no worse, how about for the rest of us? Richardson's plan would force doctors -- as a requirement for licensure -- to accept whatever the state or insurance companies provide them in the way of payment. Clearly, both the state and insurance companies will have tremendous incentives to cut costs at doctors' expense, thereby forcing doctors out of the state.

Obviously, if ever-greater numbers of doctors are forced out of New Mexico, we could end up with even less access to actual health care (as opposed to insurance) for the 1.6 million insured and the 400,000 uninsured alike. Before embarking on a massive government program that even supporters view as "imperfect," we need to take a clear-eyed look at whether this supposed "solution" might actually make the current situation even worse.

Posted by Paul Gessing at 09:54 AM | Permalink | Comments (0) | TrackBacks (0)

While the Rio Grande Foundation is often called a "conservative" think tank and Albuquerque's alternative news weekly would typically be called anything but, part of our charge is to reach out to those who may not necessarily share ideas -- at least normally. Nonetheless, when I read this article in the Alibi I felt that it was a perfect opportunity to weigh in on why all of us, no matter our political persuasion, should be concerned about government health care schemes. After all, if the state places the kind of controls on doctors that the Governor has proposed, New Mexico could see doctors leave the state in droves. This is not the favored outcome of liberals and conservatives alike.

Posted by Paul Gessing at 02:15 PM | Permalink | Comments (0) | TrackBacks (0)

Rio Grande Foundation President Paul Gessing recently appeared on Bob Clark's radio show to discuss Governor Richardson's health care reform plan and some free market alternatives. Listen to the show by clicking here. Fast forward almost one-third of the recording to get past the advertisements, etc.

Posted by Paul Gessing at 01:40 PM | Permalink | Comments (0) | TrackBacks (0)

You can tell Bill Richardson is no longer running for President (and that he is a lame-duck governor). After all, who in their right mind that is running for office would attack an entire interest group for no good reason. I'm referring to Richardson's comments that doctors are "greedy." Richardson said of doctors, "They're greedy. They shouldn't be so greedy. They should be part of the plan," in reference to his "Health Solutions New Mexico" plan.

Doctors oppose Richardson's plan in large part due to its reliance on price controls which would force doctors to take whatever payment is being offered by the government or insurance companies. This doesn't seem "greedy" to me, rather given doctors' experiences with Medicare and Medicaid, the prices of which are both determined by the federal government, doctors have a lot to worry about if they become even more beholden to the government for their daily bread.

Doctors spend a long time in medical school at great personal and financial cost to themselves. Most doctors I know are "greedy" only in the sense that they want to be fairly compensated for their work. In reality, Richardson is the greedy one because he wants to take credit for offering health care to more people with doctors, insurance companies, and businesses footing the bill. That's greedy.

Posted by Paul Gessing at 08:10 AM | Permalink | Comments (0) | TrackBacks (0)

Paul Gessing of the Rio Grande Foundation discussed Governor Bill Richardson's plans for socialized medicine in New Mexico on "Eye on New Mexico" this Sunday morning. Dennis Domrzalski hosted the program while Gessing's opponent was Charlotte Roybal of Health Care for All New Mexico. The video is now available online.

Posted by Paul Gessing at 08:20 AM | Permalink | Comments (0) | TrackBacks (0)

Those who understand economics understand that capitalism and free markets are the most efficient and fairest means of allocating resources in any society. Unfortunately, most people (including our elected officials) don't necessarily understand that. Thus, we fall prey to those who would lead us to believe that some central planning agency will allocate resources more effectively than individuals and companies interacting in a free market. This was the thinking among economic planners in the old Soviet Union and it is the thinking behind New Mexico Governor Bill Richardson's health care proposal.

In response to the Governor's government planning model, the Rio Grande Foundation recently released an issue brief, "Cutting Costs and Improving Health Care in New Mexico," that outlines several ways in which New Mexico could cut health care costs, improve quality, and improve upon its ranking as the state with the third-highest rate of uninsured in the nation.

Posted by Paul Gessing at 04:11 PM | Permalink | Comments (0) | TrackBacks (0)

No wonder the health care debate here in New Mexico has gotten so off track. The policymakers and advocates seem to have little or no understanding not just of markets, but of how bureaucracies actually operate. Two opinion pieces that somehow managed to get published in today's Albuquerque Journal are perfect examples.

The first article, "Start Health Care Reform in '08," by Charlotte Roybal of the Health Care for All campaign first discusses New Mexico's failure, despite reports to the otherwise, to reduce uninsured numbers. Fine, without reform, little change is to be expected.

Roybal then goes on to discuss the Governor's proposed Health Care Authority and how it would slash administrative costs and should generally be accountable. Of course, no specifics are offered, but plenty of buzzwords like "transparency", "meeting health care policy needs", and "clear balance of power." None of this actually gets to the heart of what the Authority will actually do and how it is supposed to control health care costs (in reality that will be rationing), but we'll just figure it all out after it passes I suppose.

The second article, Health Care Fixes Require Thought, by Dr. J. Deane Waldman at the University of New Mexico, starts out like the author is making a case for Evidence Based Medicine, a concept that would bring the scientific method to health care. The practice, while it sounds good, if imposed in a bureaucratic and governmentally-controlled system, would result in utter stagnation in innovation as doctors would be unable to offer new and patient-unique treatments.

Strangely, the author does not dwell on the topic and instead launches into the doctor and nurse shortage in New Mexico, all without mentioning that we are one of the only states nationwide that taxes health care services under the gross receipts/sales tax. There are many reasons that fewer Americans are studying to be doctors and nurses, but the most important one is socialism. We have a quasi-socialized system already and we are on the verge of going all the way. The only way to improve health care is by restoring the individual to the equation, not by adding more government on top of what we already have.

Posted by Paul Gessing at 03:42 PM | Permalink | Comments (0) | TrackBacks (0)

An editorial in today's Albuquerque Journal discusses ways in which the state can do a better job of attracting dentists. New Mexico has no dental school and I'm sure that is a hindrance on some level, thus measures have been taken to attract dentists to the state, but the Journal is not optimistic about one reform that would do more than others to attract dentists: stop charging them the state's gross receipts tax!

As the Foundation has pointed out on a number of occasions here, and here as well, New Mexico's gross receipts tax is economically-devastating with rates upwards of 8 percent in some areas. This would be bad enough if the tax were only applied to retail purchases, but the tax is also levied on services provided by dentists, doctors' co-pays, and deductibles, and all fee-for-service procedures.

Clearly, before we embark on a "universal coverage" scheme of indeterminate cost, we should enact simple reforms like eliminating unnecessary taxation, right?

Posted by Paul Gessing at 03:39 PM | Permalink | Comments (0) | TrackBacks (0)

Pam Hyde, New Mexico's Secretary of Human Services, wrote about Governor Richardson's health care proposal in today's Albuquerque Journal. The headline of the article "Health Plan no Burden on Business" summarizes Hyde's argument nicely. Unfortunately, it doesn't hold water.

Hyde states that because some employers offer their employees health care as a benefit that forcing businesses that do not offer coverage and thus would be forced under Richardson's proposal to pay into a special fund. Somehow, this is supposed to be good for business because it "evens the playing field" between those businesses that do and those that do not offer health insurance.

Hyde apparently believes that paying for an employee's health care should be yet another cost of doing business in New Mexico, even if that worker is part time. That is not "evening the playing field," it is a new tax that will chase businesses out of the state and make New Mexico even more unattractive to entrepreneurs.

Posted by Paul Gessing at 03:53 PM | Permalink | Comments (0) | TrackBacks (0)

Anyone who has taken a close look at Bill Richardson's plan to reform health care in New Mexico or the national health care system can see that our supposedly "market Democrat" Governor abandons all reliance on the marketplace when it comes to health care. That said, I was surprised to see that Richardson recently spoke in favor of abolishing health savings accounts.

His arguments, that “They (HSA's) are a step backward" and that "They put working families at risk because most families cannot afford to pay the … out of pocket costs" strike me as bizarre and uninformed. Now, HSA's are not the silver bullet for health care reform, but I don't really see how giving health care consumers more control over their care would be seen as a step backward or how they put families at risk.

More likely, it seems that Richardson doesn't like market-based approaches to health care because they make his efforts to put such decisions in the hands of government officials more difficult. That is unfortunate.

Posted by Paul Gessing at 05:18 PM | Permalink | Comments (0) | TrackBacks (0)

Long story short, New Mexico's doctors don't like Governor Richardson's health care proposal. Apparently, they don't like the idea of a government agency determining how much they can charge. The shocking thing to me isn't that the doctors have finally decided to oppose Richardson's plan, but that they supported it in the first place. Outside of the licensing issue -- a big deal -- doctors have historically been some of the strongest advocates for limited government involvement in health care.

Richardson's plan, like all government health care models, relies on the principle that someone else pays. Doctors of course are one of the major groups who face reduced payments under a government-run health care system. Perhaps New Mexico's doctors can become part of the free market solution instead of going along with the big-government problem.

Posted by Paul Gessing at 10:38 AM | Permalink | Comments (0) | TrackBacks (0)

Check out this hilarious video which hammers home the point that funding health care programs "for the children" by raising taxes on smokers is pretty ridiculous.

Posted by Paul Gessing at 10:04 PM | Permalink | Comments (0) | TrackBacks (0)

Governor Bill Richardson wants "universal coverage" passed in the upcoming legislative session. That is no secret. What has been secret up til now has been details of his plan. A broad outline was released this week and unfortunately although not unexpectedly, there is nothing new or innovative there and costs are unknown. According to an article in the Albuquerque Tribune

By 2010, everyone in the state would be required to have health insurance or show they have the means to fund their own care, under a four-phase plan Richardson will pitch to lawmakers in the 2008 legislative session. The governor today also is expected to say he wants the Legislature to mandate health insurance companies to spend 85 percent of premiums on direct services to patients, including disease prevention and management.

Officials were still working Wednesday night on the projected costs of the plan.

Richardson's plan also would require insurance carriers to offer coverage to anyone who wants it, and would prohibit them from excluding patients with pre-existing conditions.

In other words, everyone would have to have health insurance, just like in Massachusetts where Mitt Romney's similar mandate plan is failing. Is it any wonder that Richardson is postponing this mandate until 2010 when he'll safely be out of office? Since New Mexico has twice as many uninsured as Massachusetts, the task of insuring everyone will be even more difficult.

Also, insurance companies will be forced to offer insurance in a costly scheme known as "guaranteed issue."

In other words, there is no innovation, no outside the box thinking, just bigger government. The only thing to do now is to kill it.

Posted by Paul Gessing at 09:45 PM | Permalink | Comments (0) | TrackBacks (0)

Recently, I criticized Rep. Heather Wilson's support for a massive tax hike to expand SCHIP. What I didn't mention was that retiring New Mexico Sen. Pete Domenici supported the same plan to expand the program by raising taxes, despite President Bush's veto. Domenici argues his case here.

While Domenici is certainly more conservative than Wilson, this is not the first time he has been "off the reservation," especially on health care. In fact, it is particularly ironic that Domenici supported SCHIP expansion at the same time as he has finally succeeded in pushing his mental health parity legislation through the Senate.

For someone who claims not to support government-run health care, he sure likes to dabble in ways that are bound to make insurance and health care in general more expensive, thus forcing more and more Americans onto the government dole that he claims to abhor.

Posted by Paul Gessing at 09:04 PM | Permalink | Comments (1) | TrackBacks (0)

I was out of the office for a few days getting married in Algodones and have not been blogging for obvious reasons.

I was quoted in a recent story in the Santa Fe New Mexican that I think illustrates some of the problems in health care reporting specifically and economic reporting in general -- reporters focus only on the benefits of a proposed program and not on the drawbacks, nor do they question why people have the problems they do.

While I am quoted on behalf of the Rio Grande Foundation as a critic of the massive expansion of New Mexico's involvement in health care decisions, the author fails to discuss the personal decisions that allowed a 23 year old woman to become so obese that she can't work and requires oxygen at night. Why taxpayers must foot the bill for her health care is another question that goes unanswered.

Posted by Paul Gessing at 10:19 AM | Permalink | Comments (0) | TrackBacks (0)

It is no surprise that the Albuquerque Tribune, the city's left-leaning newspaper, slammed President Bush for vetoing SCHIP expansion. What is interesting is one of the arguments the paper uses in its rebuke:

It's a truly stunning action, when you consider that the federal debt has nearly doubled during Bush's deficit-spending tenure, which has been everything but fiscally responsible, let alone conservative. Now, when it comes to America's children, the federal government cannot afford to insure them against illness or death.

The president essentially decided last week that it was more important to stave off further government intervention in the nation's failing private health care system than to provide for the vital health care of 4 million more of America's children.

Obviously, we at the Rio Grande Foundation have a different perspective on the matter as do most free market health care analysts. That said, Bush's veto would have been far less of a political target if he'd maintained a consistent, fiscally-conservative stance throughout his presidency. Better late than never as far as we're concerned, but it is politically-difficult for the President.

Posted by Paul Gessing at 08:59 AM | Permalink | Comments (0) | TrackBacks (0)

As I reported here previously, New Mexico Representative Heather Wilson has been one of the ringleaders in the House in support of the massive Senate SCHIP expansion. She is now actively working to overturn Bush's veto.

This issue went from important to urgent with the news that Pete Domenici would retire and Wilson would be running for his Senate seat. As I point out in National Review Online, SCHIP is just the tip of the iceberg when it comes to Wilson's liberal record, but we need her to see the Senate race as a reason to move to the right, not the left on SCHIP and other tax and spending issues.

Posted by Paul Gessing at 03:42 PM | Permalink | Comments (3) | TrackBacks (0)

Is how we pay for health care important? A few weeks ago I skewered the Albuquerque Journal's health care columnist for arguing that how we pay for health care is irrelevant.

Needless to say, as an advocate of free markets and someone who is versed in economics, I had to respond to such a statement. This is my response (subscription required) which appeared in Thursday's paper. Basically, my argument is this:

Even avowed socialists like Michael Moore understand (to a point) that how we pay doctors is important. Insurance companies are taken to task in Moore's movie "Sicko" for denying patients necessary care. What Moore and other advocates for government-run health care fail to see is that replacing insurance companies with government bureaucrats will only make the current situation worse.

After all, someone has to control costs and that means making decisions about who receives treatment and who doesn't. Even in countries where the tolerance for high taxes is much higher than it is here, governments have imposed waiting periods and other mechanisms to deny care, thus keeping a lid on costs to taxpayers. (Of course, Michael Moore conveniently left these stories out of his movie.)

There are really only three cost-control options: individuals, insurance companies or the government. It only makes sense that individuals, particularly if they are armed with adequate information by their doctors, can obtain the best care for themselves for the lowest cost. After all, in a world of scarce resources where trade-offs are inevitable, wouldn't you rather decide how those trade-offs are made instead of having someone else decide for you?

That is the thinking behind Health Savings Accounts (HSAs). Rather than giving insurance companies or the government the final call over my health care needs, as the proud owner of an HSA, I am building money in a savings account and can use that money on the care I need. This includes "alternative" forms of medicine that are not always covered by traditional insurance policies.

HSAs or, better still, simply giving individuals the tax advantages that are now given to employers to pay for health care, will improve the quality of our health care while saving money at the same time. Any scheme that purports to "reform" health care without empowering patients must rely on someone else to contain costs and will only worsen the problems we now face.

How we pay doctors drives the incentives in the health care system. Restoring the relationship between doctors and their patients can only be done by returning patients to the rightful role of owning their own health care.

Posted by Paul Gessing at 09:59 AM | Permalink | Comments (0) | TrackBacks (0)

This is the net result of the ongoing war on politically-incorrect foods and fat people. Senior centers are now turning down donations of baked goods. Now, while I certainly don't want our seniors to turn into overweight couch potatoes, it would seem that they should probably be consulted on the matter rather than having "nanny-statists" make decisions for them. Unfortunately, the very organization that supposedly advocates for seniors' rights is one of the very groups pushing us towards socialized health care that will give the control-freaks more power over our dietary decisions.

Posted by Paul Gessing at 05:28 PM | Permalink | Comments (0) | TrackBacks (0)

It may not be the "be all, end all," health care solution, but given federal constraints placed upon the states, there is only so much that can be done without Congressional action. That said, one of the more interesting state-level approaches to health care reform comes from Missouri where the state is now allowing small business owners to contribute pre-tax health care dollars to their employees' individually selected policies.

Rather than "universal coverage," New Mexico and other states might want to consider following Missouri's example by helping to find ways to give individuals greater control over their own health care needs.

Posted by Paul Gessing at 09:08 AM | Permalink | Comments (0) | TrackBacks (0)

Heather Wilson strikes again. She has supported President Bush without fail on an unpopular Iraq War, but when it comes to fiscal issues, she is the first one to spend more money or expand government even more than Bush who has admittedly done a poor job of restraining government.

Now, it turns out that where President Bush is trying to restrain spending and stop a massive tax hike, it is New Mexico's Heather Wilson who is leading the charge for more spending. The program is SCHIP, a program that, if expanded, is a big, incremental step towards nationalized health care. David Hogberg and I discussed this and some of the many reasons expansion should be opposed a few weeks ago in the American Spectator.

No matter how "tough" Wilson's Congressional seat may be, voting for tax hikes and a massive expansion of government is inexcusable. Wilson is a prime example of a "big-government Republican."

Posted by Paul Gessing at 03:54 PM | Permalink | Comments (0) | TrackBacks (0)

With all of the focus on the newest edition of "Hillarycare," the media have largely ignored the latest mandate working its way through Congress. Unfortunately, our own Pete Domenici is riding shotgun with Ted Kennedy on this one and you just know that is not a good thing. The issue is the so-called Mental Health Parity Act and, if the House goes along with the Senate's plan, it would likely add between five and ten percent to the cost of a health insurance policy.

At a time when "universal coverage" is high on the political agenda, it would seem that policymakers would be working to make insurance less, not more, costly. Unfortunately, that will not be the case if the Mental Health Parity Act is adopted.

Posted by Paul Gessing at 08:37 AM | Permalink | Comments (0) | TrackBacks (0)

According to the Kaiser Family Foundation, the nationwide average premiums for employer-sponsored health insurance rose an average of 6.1 percent in 2007. While that is slower than in recent years, in New Mexico (according to the Albuquerque Journal subscription required), prices increased by about 8 percent.

Among the factors cited as raising prices in New Mexico is "upward price pressure from physicians" who are being squeezed by declining Medicare and other public-payer reimbursements. This is undoubtedly a big part of the problem, especially since New Mexico's reliance on public programs (table 1) for health insurance is the third-highest in the nation.

Of course, the state's high number of mandates -- New Mexico added four this year -- must take part of the blame as well.

With health insurance rates rising and Governor Richardson pushing for "universal" health care with little in the way of needed reforms, things don't seem likely to improve for New Mexico health care any time soon.

Posted by Paul Gessing at 11:19 AM | Permalink | Comments (0) | TrackBacks (0)

There are a number of major problems with American health care, but no single problem is bigger or more important than the destruction of the relationship between doctors and their patients. The latest example of this involves insurance companies paying doctors to switch their patients from brand name drugs to generics. A Boston news story on this can be found here.

While there is nothing inherently wrong with generics, there is no question that the fact that insurers stand between doctors and their patients is a big part of the problem here. As I discuss in this article for the Albuquerque Tribune,

Employers contribute no tangible benefit to their employees' health care that could not be provided without them, employers are little more than "middlemen" that stand between individuals and their insurance providers and doctors. Cutting out this unnecessary layer would give patients greater say over their insurance providers and plans, thus helping to restore the patient-doctor relationship that has become all-too-tenuous in recent years.

Adoption of President Bush's proposal to give individuals the same tax benefits for health care as their employers get would be good way to start restoring the doctor-patient relationship. Unfortunately, the left seems to be obsessed with replacing insurance companies with government bureaucrats, a "solution" that is destined to only widen the gap between doctors and their patients.

Posted by Paul Gessing at 11:05 AM | Permalink | Comments (0) | TrackBacks (0)

The fact that health care mandates drive up the costs of health care and help create larger numbers of uninsured is well-known and accepted. Before the 2007 legislative session, New Mexico had a relatively high number of mandates (45), but that was not enough for Governor Richardson and the Legislature. In fact, four new mandates were adopted this year and they are now in effect. The new mandates are as follows:

1) Hearing Aids/Related Services for Children Under Age 21 (SB 529);
2) General Anesthesia and Hospitalization for Dental Surgery (SB 776);
3) HPV vaccine for members aged 9 through 26 (SB 407);
4) Colorectal cancer screening tests (HB 510).

It would seem that driving up health care costs would be counterproductive as a means of achieving Richardson's goal of providing health care coverage for all New Mexicans, but logic does not always apply to health care policy, especially in New Mexico with one of the highest rates of uninsured in the nation.

Posted by Paul Gessing at 05:05 PM | Permalink | Comments (0) | TrackBacks (0)

Economic literacy is important. It is even more important when you cover one of the most controversial issues for the state's leading newspaper. Winthrop Quigley covers health care for the Albuquerque Journal and while I don't have a major problem with his reporting, a recent column (subscription required) of his stood out for its being based on a erroneous assumption.

Tthe headline -- which Quigley probably did not write -- provides a good summary of the article and my problem with it, "How we pay the doctor just coudn't matter less." This is simply absurd. How we pay doctors is actually the key to health care reform. If patients pay their doctors, then patients are viewed as the customer and will be treated as such. If it is insurance companies acting as the agent for employers or the government that has the relationship with doctors and ultimately pays them, then the doctors will respond to insurance companies or the government.

Quigley does point out in the article the problems associated with what he calls "health care's 19th century business model" and he notes the very real problems posed by a single-payer system, but his argument that how we pay for health care is irrelevant does not hold water.

The fact is that government regulations and cost-shifting have contributed greatly to the inefficiencies and lack of responsiveness we see in today's health care system. Giving individuals the same tax deduction now given to their employers would be a step in the right direction. So would allowing individuals to shop for health insurance across state lines as a means of avoiding state mandates that drive costs up significantly. Congressional action on market-based Medicaid and Medicare reforms would also help matters a great deal by limiting the problem of cost-shifting from Medicare and Medicaid users and on to paying customers.

Posted by Paul Gessing at 03:29 PM | Permalink | Comments (0) | TrackBacks (0)

Rio Grande Foundation scholar David Hogberg recently talked to Investors Business Daily about Rudy Giuliani's health care plan. In summary, it contains some nice reforms and it doesn't go down the dangerous road to "universal coverage," but "does nothing to cut down on burdensome regulations."

There is no doubt that health care will continue be a hot topic in legislatures and campaigns nationwide. Unfortunately, too many politicians -- including our own Bill Richardson -- see "universal care" as the be-all end-all for health care while the quality of Americans' health care is too often ignored.

Posted by Paul Gessing at 05:37 PM | Permalink | Comments (0) | TrackBacks (0)

Governor Richardson claims to be a "market Democrat," but the "universal" health care proposal that his campaign announced today can only be called a disappointment to believers in the free market.

Details of his plan are as follows:

* Coverage - Guaranteed Coverage for All Americans with Real Choices: Bill Richardson believes that there is no one-size-fits-all approach to providing affordable health coverage for all Americans.Nor does he believe in creating new bureaucracies. Under a Richardson administration all Americans will have affordable coverage choices through 1) the same plan as members of Congress; 2) Medicare for those 55-64; 3) Medicaid and SCHIP for lower income families; 4) existing family coverage for young adults up to age 25; and 5) a Heroes Health Card and stronger Veterans Administration for veterans;

* Costs - Making Health Care Affordable for All: Bill Richardson believes that everyone must share responsibility for making the system work. He believes that 1) All Americans should be required to have coverage; 2) Employers should be required to do their fair share to contribute to a healthy and covered work force; 3) A sliding-scale tax credit should be available for Americans who need help affording coverage; 4) American families should get immediate relief from high interest rates for medical debt placed on credit cards. As President, Richardson will save the government up to $110 billion per year to invest in quality, affordable health coverage for all Americans, by streamlining health care administration and investing in prevention;

* Care - Improving Quality of Care for All Americans: Bill Richardson believes that all Americans deserve access to affordable, high-quality health care. Richardson will work to improve quality of care for all Americans by: 1) Promoting evidence-based care and comparative effectiveness research; 2) Promoting transparency on price and quality of health care; 3) Restructuring incentives for high-quality care; 4) Improving patient safety; 5) Ensuring an adequate health care workforce; and 6) Reducing health disparities.

For starters, Richardson may not believe in "creating new bureaucracies," but that doesn't mean he won't dramatically-expand the current, broken bureaucracies. Medicaid, Medicare, SCHIP, and the Veterans Administration all face significant issues. I hardly think that expanding these programs/agencies is the answer to our health care problems.

Of course, Richardson is not the only Democrat heading down the misguided path to "universal coverage." The problem is that so-called universal coverage is likely to be a disaster no matter which party ultimately passes it.

Posted by Paul Gessing at 02:47 PM | Permalink | Comments (1) | TrackBacks (0)

Yesterday, David Hogberg and I wrote on the American Spectator website about some of the health care proposals being cooked up by the Democrats in Congress. Today, we discuss SCHIP and how that program is being used to create "universal health care" by making us all "children."

As I mentioned in my recent Wall Street Journal piece, New Mexico Governor Bill Richardson has been a national leader in expanding this program, thus putting more New Mexicans than ever on the government dole.

Congress may vote as early as today on expansion.

Posted by Paul Gessing at 10:33 AM | Permalink | Comments (1) | TrackBacks (0)

In today's edition of the American Spectator online David Hogberg and I take on the issue of health care in the current Democratic Congress. While the Republican Party's record on health care was no better (prescription drug bill, anyone?), other steps were taken in the right direction such as the move by John Shadegg (R-AZ) to allow individuals to purchase health insurance across state lines.

While health care certainly needs reform, adding new mandates like Mental Health Parity and allowing Medicare the authority to "negotiate" with drug companies for lower drug prices is a step towards Michael Moore's vision of socialized health care, not better health care.

Posted by Paul Gessing at 10:12 AM | Permalink | Comments (0) | TrackBacks (0)

While it generated a good deal of buzz on the left and in the media, relative to Farenheit 911, Michael Moore's "Sicko" seems to have been a dud. There may be any number of reasons for this relative lack of success, but I think the overtly-socialist message has a much narrower audience than a foreign policy flick that tears apart what we all know was a deeply-flawed foreign policy being propagated by the Bush Administration.

Of course, when Kurt Loder of MTV fame unloads a scathing review, it is a given that the rest of the mainstream, left-leaning media is not lined up in lock-step with your cause.

Posted by Paul Gessing at 11:32 AM | Permalink | Comments (0) | TrackBacks (0)

Micha Gisser, a senior fellow with the Rio Grande Foundation, had an excellent article on health care in the Albuquerque Journal last week. In his article, Gisser explained that despite a relatively widespread lack of insurance in New Mexico, no hospital denies patients essential coverage. And, while having large numbers of uninsured is less than ideal, nationalized healthcare is not needed to resolve this problem. In fact, Gisser points out, "President Bush's proposal to cap the tax deduction for employer-sponsored health insurance at $15,000 and give people the same tax break to buy insurance regardless of whether they get it from an employer or elsewhere," would have a tremendous impact on the ability of individuals to obtain health coverage.

Gisser clarifies once and for all that mandatory health care as Massachusetts has done is based on the absurd assumption that we will criminalize lack of insurance. Gisser writes, "Suppose New Mexico passes a law insisting that everyone purchase health insurance from any of the private insurance companies. Are we willing to enforce the law by sending the 'disobedient' head of a nonpoor household to prison?"

As I wrote a few weeks ago, there are no "easy" health care solutions.

Posted by Paul Gessing at 04:01 PM | Permalink | Comments (1) | TrackBacks (0)

New Mexico is so poor...how poor? It's so poor that the state's Human Services Department serves one out of three citizens of the state. You know the worst part of it is that they are so proud of that fact that they put that at the very top of the webpage for all to see. While serving one of three New Mexicans may seem like a lot, if the Legislature passes "universal health care" which Richardson has endorsed, one in three could be just the start.

Hat tip to John LaPlante, Managing editor of the blog State House Call.

Posted by Paul Gessing at 02:31 PM | Permalink | Comments (0) | TrackBacks (0)

Without a doubt, the biggest health care story of the next few weeks will be left-wing filmmaker Michael Moore's movie Sicko in which Moore lashes out against a variety of problems with the US health care system and makes the case for socialized health care.

Albuquerque hosted a "sneak preview" of the movie and since I was curious, I went over the weekend.

The beginning of the movie is a series of vignettes with people who have been left behind for whatever reason by the American health care system. Although little in the way of hard data are presented, given the role health insurance companies play in denying and limiting patients' access to health care, he certainly has a point. Unfortunately, rather than criticizing the fact that federal law places HMO's and other intermediaries between patients and doctors, Moore uses his examples to build the case for Hillary Clinton-style nationalized health care.

Moore then takes on the American Medical Association for their role in limiting the supply of doctors. On this point, although he'd probably be horrified, Moore is in agreement with none other than Milton Friedman. The very goal of professional licensing is to limit supply, thus increasing prices. Doctors are not the only ones who do this within the medical system, but the power of these professional organizations is one factor that drives health care costs up.

Moore then visits Canada, Britain, and France and interviews a number of people who rhapsodize about the wonders of their respective systems -- basically, health care is "free" and we can't imagine how it must feel to pay for health care. Of course, Moore glosses over the very real problems with both the costs and the long waits for service in these countries: Britain, France, and Canada.

Lastly, we embark upon the episode involving the 9/11 workers and the visit to Cuba that has made headlines. I do believe that it was a shame and a travesty that workers at Ground Zero have not received the health care they needed. Surprisingly, Moore did not specifically mention the Environmental Protection Agency's role in providing a false sense of security to workers and others who were exposed to the dust and rubble of the World Trade Center towers.

While even Moore admits that Cuba is a poor country, he fails to point out that it is the very socialist system that provides ridiculously cheap medical care that makes the place so un-livable. All the viewer sees is grateful Americans who have been ignored by their own government receiving "free " health care.

There is no doubt that Michael Moore's movie is part of a coordinated effort on behalf of socialized medicine. Bill Richardson will be making a big push for some kind of "universal" coverage in New Mexico next year and all of the Democrats running for President have proposed some kind of universal coverage.

Unfortunately, what we really need in health care is a good dose of capitalism and reforms that peel away the socialism that has built up over the years in our system. Seems that we need a libertarian/conservative version of Michael Moore to propagandize on behalf of limited government.

Posted by Paul Gessing at 03:59 PM | Permalink | Comments (1) | TrackBacks (0)

There is a heavy freight train rolling downhill and New Mexico's economic future is tied to the tracks. What am I talking about? Just the biggest, most expensive mandate to hit New Mexico businesses and taxpayers in a long, long time: universal insurance (subscription required).

I previously reported the fact that Mathematica, the firm analyzing three different proposals for New Mexico health care, had said that a single-payer system would be cheaper than the system now in place. Now, according to the Journal article today, it is said that all three proposals would save money compared to today's system. This, despite the fact that the single-payer and "voucher" systems would require new payroll taxes of between 4 and 8 percent!

I'm not buying it. How many times have well-paid consultants and analysts tried to tell us that down was up and 2 + 2 was 5 in order to sell some new government program? The truth is that government intervention in the market has caused most of the problems we are dealing with in health care today and bigger, more ambitous government programs will only multiply those woes.

Posted by Paul Gessing at 02:36 PM | Permalink | Comments (0) | TrackBacks (0)

A few weeks ago the Minnesota-based Center for the American Experiment published a symposium of views from various think tankers and economists on the topic "Should Medicare be Means Tested?"

Perhaps not surprisingly, I said "quite simply, yes." After all, it seems unfair from my perspective for middle and lower income Americans to pay for wealthy recipients of a federal entitlement program.

The fact is, despite legitimate differences of opinion among such free market and conservative luminaries as Grover Norquist of Americans for Tax Reform, John Berthoud of the National Taxpayers Union, and Congressman Tim Penny, something needs to be done to reform entitlements and soon.

Posted by Paul Gessing at 01:39 PM | Permalink | Comments (0) | TrackBacks (0)

Health care is going to be an extremely hot topic over the next 9 months or so (if not longer) here in New Mexico. A single payer bill is being pushed along with other "reforms." I wrote an opinion piece in the Albuquerque Journal recently explaining why, although not as complicated as the experts make them out to be, the solutions to our health care mess will not be found in more government programs and regulations, but in peeling back some of the absurd rules and regulations that have perverted the health care marketplace.

Posted by Paul Gessing at 05:28 PM | Permalink | Comments (0) | TrackBacks (0)

My six-month old Siberian Husky, Jack (click here for picture), recently had some health problems. Namely, He swallowed a hackeysack, one of those little bean-filled balls that kids kick around. After two trips to the vet and severy tests, the situation was resolved and the hackeysack removed.

But, the situation got me to thinking about health care and the ways in which human health care differs from veterinary care. First and foremost, Jack was "uninsured." I'm not sure about the number of "uninsured pets," in this country, but I am pretty sure that it is a national crisis of epic proportions and that some government solution is necessary.

Anyway, because Jack had no insurance, his bills were all paidout of pocket and upon completion of his treatment by me and my fiancee. To say the least, this is not common practice when it comes to human health care. In fact, a friend of mine was treated for a torn anterior cruciate ligament in Albuquerque and, after repeated requests for an itemized bill, the hospital simply refused to provide one.

It would seem obvious to me that if you don't provide consumers any information about their health care costs and the tradeoffs they create, you will continue to have costs spiral out of control. Perhaps we can take a lesson from the vet...now if I could only get Jack a Health Savings Account!

Posted by Paul Gessing at 02:41 PM | Permalink | Comments (0) | TrackBacks (0)

There has been a great deal of talk recently about health care reform in New Mexico, in part, because Governor Richardson is likely to dub the 2008 legislative session "the year of health care" and use the session to push for some kind of major health care reform.

The major proposals are known as the "Health Security Act" (single payer system), "New Mexico Health Choices" (taxpayer-subsidized vouchers), and the "Health Coverage Plan" (expansion of existing government programs like Medicaid). Specifics of all three are outlined on page 14 of this document.

With momentum building for some kind of reform, it was troubling to read that a firm known as Mathematica, which is studying each proposal, recently found that the single-payer plan would save taxpayers money. This drew a quick response.

I'm not going to judge the credibility of Mathematica before their final report is issued and I understand that the analyst made "heroic assumptions," but Canada's problems with single-payeer care are well-known and socialism has a rather poor track record in health care, not to mention the Soviet Union.

Rather than more government, what New Mexico needs is to peel back government involvement in health care. That may take more time than simply imposing a socialist model, but it is the only one that will work.

Posted by Paul Gessing at 10:54 PM | Permalink | Comments (0) | TrackBacks (0)

In something of a quick turnaround, Governor Richardson has vetoed a bill that would have put the state in charge of a system of mandatory vaccinations for all girls entering the 6th grade. As recently as 3 weeks ago,I'd blogged about the issue and mentioned that with Richardson having expressed support for the effort, the bill looked like "a slam dunk."

Apparently, he got cold feet. Wise move by the Governo, especially after the debacle over this issue in Texas. States should not be in the business of providing mandatory vaccinations unless the disease is highly communicable and dangerous.

Posted by Paul Gessing at 10:47 AM | Permalink | Comments (0) | TrackBacks (0)

Although it is not something the Foundation has worked on, it has been interesting to watch the debate over medical marijuana from the sidelines. Having failed in the first effort to pass a bill through the House, Governor Richardson did some arm-twisting behind the scenes and urged legislators to pass a bill...thus New Mexico becomes the 11th state in the nation to allow sick people the use of marijuana with a doctors' recommendation.

Although New Mexico is a poster child for ways in which the debate over drug policy can split otherwise amicable limited government types, it is hard to argue from a limited government perspective that allowing medical patients the freedom to use the treatments that work for them is a bad thing. Perhaps more importantly, as more and more states pass their own medical marijuana laws, pressure will increase on the federal government to give states more freedom to experiment with their own policies as opposed to running everything from Washington.

Posted by Paul Gessing at 08:37 PM | Permalink | Comments (0) | TrackBacks (0)

There is seemingly no area of our existence that can now escape the tentacles of government. Soon to be added to that list in New Mexico is mandatory vaccinations for HPV virus for all girls entering sixth grade unless their parents sign a waiver.

Governor Richardson has already said he'll sign the bill mandating the vaccine, but who will pick up the $400 tab for the shots? Presumably this will fall to taxpayers one way or the other.

We're all for preventing diseases -- that's one of the reasons we support Health Savings Accounts after all -- but governments that mandate you get a vaccine for the sole purpose of protecting yourself -- as opposed to vaccinating people in order to stop a disease to spread through the entire population -- seems a bit over the top.

Posted by Paul Gessing at 03:42 PM | Permalink | Comments (0) | TrackBacks (0)

If you've read the opinion pages of the Albuquerque Journal recently, you've probably noticed that health care has been discussed on an almost daily basis. Representative Dan Foley, for his part, had an article today that started off strong by explaining why government is not the best provider of health care. Foley is absolutely correct when he writes that "with a finite number of dollars available, the government will have to decide who gets how much health care and how much health care that should be."

Unfortunately, Foley then goes on to outline a plan to provide "universal coverage" that sounds suspiciously like the plan adopted by Massachusetts. Unfortunately, the plan adopted by Massachusetts is quickly turning out to be a costly failure.

Interestingly enough, in the Journal's business outlook section, another article called "Why Health Savings Accounts Save Money," appeared (subscriptinon required). This excellent article outlines the simplicity and relative ease with which consumer-driven health care can cure what ails our health care system. Rather than embarking on universal coverage boondoggles, Richardson and the Legislature should focus on ways to expand consumer-driven solutions like HSA's.

Posted by Paul Gessing at 10:22 PM | Permalink | Comments (0) | TrackBacks (0)

Stuff happens. It is part of life. But when you are a member of Congress, what happens to your family often colors your worldview to the point that rightly or wrongly you act in ways that are inconsistent with your beliefs. This is especially true for New Mexico Senator Pete Domenici and Senator Michael Enzi of Wyoming who are teaming up with Sen. Ted Kennedy in an effort to add mental health to the long list of mandates on your health insurance.

While the big-government mindset of Sen. Kennedy is widely known, Senators Domenici and Enzi are usually level-headed conservatives. Unfortunately, personal tragedy has led Domenici to support bad policy, but I'm not sure what happened to Enzi.

At a time when Congress and the states are fixated on reducing the costs of health care, it simply makes no sense for our elected representatives to force consumers to bear the costs of even more coverage they may not need.

Posted by Paul Gessing at 12:30 PM | Permalink | Comments (0) | TrackBacks (0)

While most free marketers did not support President Bush's massive expansion of Medicare, the introduction of Health Savings Accounts (I love my HSA!) was a positive outcome of the costly legislation. Curiously enough, as Investor's Business Daily points out, the percent of increase in health care costs has actually slowed down in recent years.

While this is something of a minor victory, it is a promising sign that increased reliance on consumer driven health care (HSA's are the best example) will slow the rapid increase in medical spending. This is something that Governor Richardson and Democrats in Congress may want to consider before they again expand government's role in health care.

Posted by Paul Gessing at 09:41 AM | Permalink | Comments (0) | TrackBacks (0)

Many Americans mistakenly believe that they are not getting what they pay for relative to health care consumers in nations with socialized medicine. Although there are indeed numerous problems with the provision of and payment for health care in this country, the problem is not that we are not getting our money's worth, rather it is misaligned incentives. As Investor's Business Daily points out, other nations also measure their health care outcomes rather differently than the US does, thus downplaying our successes and inflating their results. Given the momentum behind plans that would give government bureaucrats more power than they already have over the health care of New Mexicans and Americans alike, it is more important than ever to use accurate data.

Posted by Paul Gessing at 04:05 PM | Permalink | Comments (0) | TrackBacks (0)