Another article against nationalized health care

A Health Care Model For Failure

By INVESTOR'S BUSINESS DAILY | Posted Tuesday, January 27, 2009 4:20 PM PT

Socialized Medicine: Anyone who thinks a national single-payer system would be an improvement isn't paying attention. Medicare, which provides coverage for less than 15% of the population, can't get it right.

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The federal government seems to always be in a hurry to dole out pork, but it has problems reimbursing doctors who see Medicare patients.

Payments have been so late in some cases that doctors from New York to California have had little choice but to take out loans — some as large as $3 million — to bridge the gap.

The late payments, which can be over $100,000, are only part of the problem for doctors.

In too many instances, the compensation that is eventually provided by Medicare — an amount determined by bureaucrats, not the market, and is therefore subject to error — is simply not enough to cover the physicians' costs.

"When I saw a Medicare patient with pneumonia and they needed a shot that cost $30, and Medicare would reimburse only $21, I gave him the shot," Eugene Wood, a recently retired Jackson physician, told the Mississippi Business Journal last fall.

"I went ahead and practiced good medicine. But I just kept going in the hole."

The trend toward late and below-cost reimbursements creates trouble at two levels.

First, some doctors are cutting back on the number of Medicare patients they see — limiting medical care access for the elderly who rely on Medicare and have paid into it for 40 years or more.

Still others found that they have had to lay off staff and trim their own salaries to continue their practices.

Second, the arrangement kills incentives for medical school students to practice family medicine, which already seems to be a dying art, as only 8% of 2006 U.S. medical school graduates opted for family practices. That's about half the number of graduates who were choosing to go into family practice in the early 1990s.

Making $150,000 a year right out of school might sound like a dream to many, but when doctors owe a year's salary and often more in medical school student loans, their handsome incomes don't look as attractive. A family physician has to be as good a businessman as a doctor if he is to keep his practice above water.

If this is the mess that Medicare is producing, imagine the intractable complications that a universal government system would bring.

Who would want to practice medicine under those conditions? Where will sick Americans go when doctors are fleeing practices and the demand for care under a "free" system outstrips supply?

Medicare and Medicaid, the program for low-income Americans, cover a quarter of the U.S. population and will account for a fourth of federal outlays this year.

No matter how much a Washington player promises that he or she can bring health care costs down through a national system, the numbers say that under a universal program, the entire federal budget will be dedicated to providing health care.

Like it or not — and we don't — Medicare and Medicaid, both established in 1965, have become deeply embedded in the American fabric. They will not go away. The best we can hope for is some sort of reform that lessens the taxpayers' liabilities and increases the responsibility of individuals.

What the country doesn't need is universal care. If universal care is the only alternative, we'd prefer the status quo.

But even that's trouble. Already Medicare's Hospital Insurance is paying out more in benefits than it takes in from tax revenues. By next year, outlays for the entire program will exceed income. The Hospital Insurance Trust Fund will be exhausted by 2019.

System trustees estimate that over the long term, Medicare will have $36 trillion in obligations that aren't funded under the current setup. That, according to analysts at the Heritage Foundation, means "every American household's share of Medicare's unfunded obligation is like a $320,000 IOU."

If Washington can't run a program for 44.1 million people without bankrupting the nation, how can it possibly operate a national health care system for more than 300 million?

But unless Republicans resolve to stop the movement for good, Washington will surely try — and fail.