National Health Care is not the Answer

It must be obvious by now to all reasonable observers that the Federal Government’s control of this nation’s senior citizen healthcare through the Medicare system, the care of the indigent by means of a state controlled Medicaid organization and the supervision of the remainder of healthcare recipients’ medical issues by numerous Managed Health Organizations (MHOs) have each been a dismal failure. They were experiments doomed to malfunction from the outset because their prospective success was based upon the faulty premise that cheap healthcare would be inexpensive healthcare; cheap, in some cases for the recipient yes, but not inexpensive for the nation’s economy, the federal budget or the business community. On the contrary, when one is offered any commodity at a reduced cost, the inevitable shortages produced by the enticing bargain price cause the ultimate costs to spiral out of control; for the less economically informed it’s called the law of supply and demand.

Supply and demand is perhaps one of the most fundamental concepts of economics and it is the backbone of a capitalistic, free market, consumer driven economy. Demand refers to how much of a product or service is desired by the buyers at any given time. In this case (I.e. the context of these essays) the product is medical care. The quantity demanded is that amount of a particular sort of medical care that people

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are willing to buy at an affordable price; the relationship between the fee for service and the quantity of medical service demanded is known as the demand relationship; unfortunately quality of care, as we have come to discover, does not necessarily enter into the equation. Supply represents how much the market can offer; in this case how many physicians are available and how many patients each one of those doctors can effectively see per day. The quantity supplied refers to the amount of medical care that certain physicians are willing to supply when receiving a certain amount of remuneration for their service. The direct correlation between the price (physician’s fee) and the amount of a good or service (medical care) that is supplied to the market is known as the supply relationship. Price, therefore, is a reflection of supply (in this case the number of physicians available) and demand (the number of patients seeking care in their community). The price is inversely proportional to the supply and directly proportional to the demand.

Barak O’Bama and his fellow, ideologically liberal cohorts currently employed by the government are admitting the conspicuous failure of the current systems that control (I.e. manage) our healthcare simply by their patently obvious desire to change the way healthcare is delivered and to create a national (I.e. socialistic) healthcare system. They want to turn 16% of our gross domestic product (GDP), the current dollars spent on providing healthcare to our citizens, over to the same kind of people who demonstrably missed the boat when they originally declared in 1965 that the 1990 bill for Medicare would be a “mere” 9 billion dollars, when in fact it turned out to be an exorbitant 66 billion of the hard earned dollars which the average, hard working citizen pays in taxes. Our average GDP for the year 2007 was approximately 14 trillion dollars. 16% of that is two and one quarter trillion dollars.

The late George Santayana (1863-1952) wisely said, “He who fails to learn from past history is doomed to repeat it.” The past history of every country that has previously nationalized its health care system has shown it to be a predictable, pathetic and expensive failure. Consider our neighbor to the north; Canada. Why do those who can afford to pay for health care out of their own wallets flock to bordering American cities like Buffalo and Detroit when they incur a serious illness? The answer is certainly not because it is less expensive. Canadian healthcare is “free.” That is, they have already paid for it with confiscatory taxation. For example, a citizen of British Columbia earning $97,600 pays 14.7% of his or her wages in provincial tax and 26% in federal income taxation. Add to that 40.7% income tax the further sales taxes they pay on necessary commodities; they forfeit two types of sales tax on every purchase: The PST (or provincial sales tax) which in British Columbia is 7% and the GST (a federal tax on goods and services) currently at 5%. The Canadians obviously pay dearly for their “free” healthcare and so will we if Senator O’Bama has his way.

The answer to the question regarding the reason for their exodus southward, when a medical problem arises, has nothing to do with what they don’t have to pay; it has everything to do with accessibility; and especially a timely accessibility of health care. For example, in a 1990 study of the comparative availability of MRI units in the United States compared to their relative convenience in Germany and Canada revealed the following statistics: US had 2,900 units or 11.2 per million population; Germany 3.7 units per million inhabitants; Canada 1.1 units per million of its citizens. It is little wonder that the waiting period for obtaining an MRI exam is far too excessive in Canada. Compare these other 2005 statistics chronicling the two country’s respective managements of our nation’s number one killer; coronary artery disease (CAD). The number of patients with CAD undergoing investigative, diagnostic angiography was 34.9% U.S. vs. 6.7% in Canada. Those CAD patients being treated with the less invasive percutaneous transluminal coronary angioplasty was 11.7% U.S. vs. 1.5% in Canada. The numbers of CAD patients going on to have coronary-artery bypass surgery was 10.6% U.S. vs. 1.4% Canada. Those statistics are not a reflection of the incidence of CAD in the two nations but instead would suggest that the procedures are being rationed in Canada, where the patient has no out of pocket expense. The qualifications for having those procedures (I.e. the screening by age, symptoms, etc.) have weeded out more people. Canadians certainly are at no less risk for developing CAD than are Americans.

Consider this conclusion from a 2004 study, reported in the popular medical journal Circulation on September 28, 2004, comparing the relative mortality from myocardial infarction (I.e. heart attacks) in the two countries. The article was published by a collaboration of investigators from the University of Alberta, Duke University, Toronto University and the Cleveland Clinic. The conclusions read as follows: “Our results suggest, for the first time, that the more conservative pattern of care with regard to early revascularization in Canada for ST-segment elevation acute myocardial infarction may have a detrimental effect on long-term survival. Our results have important policy implications for cardiac care in countries and healthcare systems wherein use of invasive procedures is similarly conservative.” The word conservative may be interpreted as being synonymous with rationing in a socialistic system such as that planned by Senator Barak H. O‘Bama.

The law of supply and demand states that, other factors being equal, the lower the price of a good, the more people will demand that good (in this case medical care). In other words, the lower the price (in national health care it is zero), the higher the quantity demanded. The amount of a good that buyers purchase (I.e. healthcare) at a lower price (or at no immediate cost to the patient in a national health care system) is more because as the price of a good goes down, the opportunity of buying that good increases. As a result, people will naturally overuse a product that is free and which will not force them to forgo the consumption of something else they value more; like food, recreation, clothes or entertainment. When the demand for medical care exceeds the medical community’s ability to provide it (I.e. the supply), shortages and rationing will inevitably occur; it‘s not rocket science. That has occurred in all socialistic economies that have provided the type of delivery system proposed by first term senator Barak O‘Bama. When fewer young Americans apply for medical school because of the institution of socialized medicine, shortages will inescapably occur, and with those predictable shortages rationing of health care is sure to follow.

Rationing can be implemented in numerous ways; by reducing the number of facilities performing a service (I.e. MRI units or heart labs, as in Canada), by placing an age limit on those who qualify (I.e. no renal dialysis or coronary artery bypass if you are over age 60), or by increasing the stipulations that qualify a person for a given treatment or diagnostic procedure, such as age, number of dependants relying on your employability or co-morbid diseases that might impact the success of the treatment being requested. That is the alleged “cure” that Sen. O’Bama is offering to reverse the sick, but not yet terminally ill, state of our medical system. If he has his way, the prognosis is not good.

Next week I will explain why HMOs are costing so much and explicitly elucidate their specific role in the soaring cost of medical care to both American based industry and the citizens of the United States. Thus we will examine another pathological process affecting the ill health of the medical care delivery system in the US. Remember, a correct diagnosis must always precede any reasonable hope for a cure. Trust me when I say that a cure is available and the patient (US Medicine as we have known it in the past) need not die.