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Does health reform mean a “government take-over” AND WHAT ROLE DOES GOVERNMENT PLAY IN HEALTHCARE TODAY? 

Neither the current Democrat’s Affordable Health Choice Act, HR 3200, nor the single-payer bill, HR-676, involve a “government take-over” of health care. In either case, care will be delivered by the private sector. However, any form of insurance requires regulations to protect the consumer and the public in general. 

It is important to understand that we, all of us as a community, already are involved in the funding of health care to a greater extent than any other “consumer commodity.” Currently, over 65% of the cost of health care in the U.S. is paid for by taxes, e.g. Medicare, Medicaid, VA, Indian Health Service, all city, county, state, and federal employees, and any businesses contracted with various levels of government who supply their workers with health care (any contract includes total wage packet costs).[1] 

Almost all of the basic scientific research that forms the foundation for medical advances is paid for by the taxpayer (National Institutes of Health and research grants to universities). No private for-profit company is going to invest 10s of billions of dollars over 20 – 30 years with no guarantee of success. In addition, over half of all breakthrough drugs are funded by the taxpayers as well as innovative new medical procedures. Medical education is highly subsidized (tuition and fees comprise only about 10% of actual costs) and medical residencies are funded by Medicare. Many hospitals were either built or renovated through taxpayer monies starting with the Hill-Burton Act of 1946 and for many years Medicare built into their fee schedule to hospitals the cost of new equipment acquisitions so that many of the CAT scans, MRIs, etc. were funded by Medicare.[2] 

It challenges credibility to claim that anything mainly funded by taxes would fit a free-market model. F.A. Hayek, founding gestalt of Libertarian free-market economics, whose seminal book, “The Road to Serfdom,” is a continuous screed against government as the ultimate threat to freedom and free markets freedom’s guarantor, writes: “Nor is there any reason why the state should not assist the individuals in providing for those common hazards of life against which, because of their uncertainty, few individuals can make adequate provision. Where, as in the case of sickness and accident, neither the desire to avoid such calamities nor the efforts to overcome their consequences are as a rule weakened by the provision of assistance—where, in short, we deal with genuinely insurable risks—the case for the state’s helping to organize a comprehensive system of social insurance is very strong [my emphasis].”[3] 

Joel A. Harrison, PhD, MPH 

REFERENCES

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[1] Harrison, Joel A. “Paying More, Getting Less: How Much is Our Sick Health Care System Costing You?” Dollars and Sense Magazine, May/June 2008. http://www.dollarsandsense.org/archives/2008/0508harrison.html

[2] Public Citizen. “Rx R&D Myths: The Case Against the Drug Industry’s R&D ‘Scare Card,’” July 2001. http://www.citizen.org/documents/ACFDC.PDF; William Shonick. “Government and Health Services: Government’s Role in the Development of U.S. Health Services 1930-1980,” Oxford University Press, 1995.

[3] F. A. Hayek. “The Road to Serfdom (Fiftieth Anniversary Edition),” Chapter 9: Security and Freedom, page 133. The University of Chicago Press, 1994.