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ObamaCare's Economic Flaws
IBD Editorials ^ | June 8, 2011 | DOUGLAS HOLTZ EAKIN

Posted on 06/08/2011 4:36:51 PM PDT by Kaslin

The Patient Protection and Affordable Care Act — better known to Americans as ObamaCare — hinges on a single provision known as the individual mandate. This mandate is a dramatic intrusion on individual liberty that requires virtually every American to buy a government-sanctioned health insurance policy.

Befitting its legacy of defending U.S. small business, entrepreneurs and the free market, the National Federation of Independent Business (NFIB) has challenged the constitutionality of the individual mandate. The lawsuit, which was argued Wednesday at the 11th U.S. Circuit Court of Appeals, is expected to reach the Supreme Court for its ultimate resolution.

Legally, the use of the Commerce Clause ("Congress shall have power ... to regulate commerce ... ") to compel individuals to participate in the market for health insurance is unprecedented.

Thus, in defending this unprecedented law, the Obama administration has significantly relied on the notion that the economics of heath care are so unique and different as to justify discarding established constitutional protections. But that economic contention is fundamentally flawed, as I, along with 104 other economists, explained in an amicus brief in the NFIB lawsuit.

Specifically, the government's position rests on two false economic claims. First, that an individual's decision not to buy health insurance substantially affects interstate commerce by increasing the costs of health insurance for all Americans.

Second, that the health care industry is "unique" because of its high rates of participation, high costs, federal mandates and the purported uncertainty surrounding when care will be required.

Let's consider these in turn.

(Excerpt) Read more at ...

TOPICS: Business/Economy; Culture/Society; Editorial; Government
KEYWORDS: bhofascism; liberalfascism; obama; obamacare; ppaca; socialistdemocrats; socialisthealthcare

1 posted on 06/08/2011 4:36:52 PM PDT by Kaslin
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To: Kaslin
There is a fact that is never mentioned when discussing Obamacare that I think needs a larger airing: much of "medical" costs have to do with the liability exposure that doctors face treating patients. The lawyers are the reason that doctors practice defensive medicine, preforming tests that fall in the realm of no-sparrow-shall-fall diagnostics and treatments. I witnessed this very thing when I had a heart attack -- my insurance company said that a good number of the tests done on me were "unnecessary". Right. The doctor thought they were necessary. And I never got to weigh in on the discussion. So I'm still paying off the uninsured portion of my treatment, which is 52 percent of the total.

There is a solution, but conservatives won't like it much: have the insurance company share the liability. If the insurance company refuses to cover a procedure, then that fact should be part of any litigation.

2 posted on 06/08/2011 4:46:59 PM PDT by asinclair ("Buy American" -- unless the other product is significantly superior)
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To: asinclair
There is a solution, but conservatives won't like it much: have the insurance company share the liability. If the insurance company refuses to cover a procedure, then that fact should be part of any litigation.

Part of the pharmaceutical promotion to medicine is because of the "sharing the blame" from doctors just to keep their financial heads above water IMO.

Freedom from Tort would be seen as a major step in improving health care.

3 posted on 06/08/2011 4:59:36 PM PDT by EGPWS (Trust in God, question everyone else)
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To: Kaslin
stupid people
4 posted on 06/08/2011 5:03:06 PM PDT by FrankR (A people that values its privileges above its principles will soon lose both.)
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To: FrankR
Language granting HHS that power was never in the original law. Instead, through new rules and regulations, HHS gave itself the power last summer using a broad interpretation of certain parts of the law.

Another problem.

5 posted on 06/08/2011 5:06:25 PM PDT by scooby321
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Obamacare desires to do away with the single practice doctor and merge them into AGO’s eventually becoming direct government employees with union benefits etc. Right now the doc pays rent, a nurse salary, health benefits and a front office person to keep his schedule. If he is a GP he gets $24 per visit. MediCal pays $18. He has to see an awful lot of people to keep his doors open. Surprise. He is a business! Now if we want our doctors to be union employees who can go on strike...

6 posted on 06/08/2011 6:04:04 PM PDT by Semperfiwife (Thank you veterans for keeping us free. Now we have to free ourselves from Obama tyranny)
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To: Kaslin

I came across a perfect example of the horrible flaws in the legislation. The mother of my daughter’s tennis opponent in a recent match engaged me about Obamacare. I did not bring up the subject. I had not met her before. She told me that her cardiologist husband was leaving private practice after 13 years because of Obamacare. I was surprisesd when she told me that she was a ardent Democrat. She was still not sure that she could vote against Obama even after her husband’s loss of practice. Obamacare has barely begun so if it is bad now, the situation will be much worse later. Her husband cannot keep his practice afloat with the low reimbursement rates and many onerous requirements in the law.

Obamacare is a disaster to its core. It is easy to get lost in all of the horrible details. I focus on the assumptions and basic aims of the law. The law codifies the misguided notion that someone else should pay for your health care. The rats call this scheme “health care rights”. The law uses the familiar tyranny of the majority to enforce this misguided notion. Individuals with incomes up to $90,000 will receive subsidized health insurance. Obamacare along with many other rat legislation try to establish legal right to confiscate property from others (the rich).

Beyond the assumptions of free loading and destruction of private property, Obamacare involves effective government control of an incredibly complex industry (a number of industries). Government control means mandated services, price controls, and rationing. Basic economics is clear about the results of central planning on this scale. There will be lots of unmet demand unless black and grey markets develop. You may have a right to health care but that right cannot force availability of competent health care services.

7 posted on 06/08/2011 6:18:52 PM PDT by businessprofessor
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