The Free Market CAN Fix Health Care

Yes, Mr. President: A Free Market Can Fix Health Care

In March 2009, President Barack Obama said, "If there is a way of getting this done where we're driving down costs and people are getting health insurance at an affordable rate, and have choice of doctor, have flexibility in terms of their plans, and we could do that entirely through the market, I'd be happy to do it that way." This paper explains how letting workers control their health care dollars and tearing down regulatory barriers to competition would control costs, expand choice, improve health care quality, and make health coverage more secure.

First, Congress should give Medicare enrollees a voucher and the freedom to choose any health plan on the market. Vouchers would be means-tested, would contain Medicare spending, and are the only way to protect seniors from government rationing.

Second, to give workers control over their health care dollars, Congress should reform the tax treatment of health care with "large" health savings accounts. Large HSAs would reduce the number of uninsured Americans, would free workers to purchase secure health coverage from any source, and would effectively give workers a $9.7 trillion tax cut without increasing the federal budget deficit.

Third, Congress should break up state monopolies on insurance and clinician licensing. Allowing consumers to purchase health insurance licensed by other states could cover one-third of the uninsured without any new taxes or government subsidies.

Finally, Congress should reform Medicaid and the State Children's Health Insurance Program the way it reformed welfare in 1996. Block-granting those programs would reduce the deficit and encourage states to target resources to the truly needy.

The great advantage of a free market is that innovation and more prudent decisionmaking means that fewer patients will fall through the cracks. [...]

Precisely! The current healthcare system is hamstrug with government regulations that prohibit the free market from working. The free market hasn't failed healthcare; it hasn't had a free hand to work.

The part of the article I've quoted here is just the beginning. If you follow the link, there is a PDF file with the entire policy analysis in detail.

All this could be done without creating TRILLIONS of dollars of debt, and without creating new government programs that can't be sustained.
     

Enlightened, affordable healthcare, that works

Whole Foods-Style Health Care

[...] Whole Foods has always had a philosophy of treating its employees as intelligent human beings, empowering them to made decisions not normally delegated to people who might otherwise be seen as unskilled labor, and giving them significant incentives to improve their performance and productivity. Part of his formula for treating employees well has been the company's approach to health-care benefits.

He talked about it in a commentary in the Wall Street Journal last week. Here's the essence of it:

Whole Foods Market pays 100% of the premiums for all our team members …for our high-deductible health-insurance plan. We also provide up to $1,800 per year in additional health-care dollars through deposits into employees' Personal Wellness Accounts to spend as they choose on their own health and wellness.

And then later on:

Our team members therefore spend their own health-care dollars until the annual deductible is covered (about $2,500) and the insurance plan kicks in. This creates incentives to spend the first $2,500 more carefully.

Do you see the essence of what he has done? First, by offering high-deductible insurance, he has returned the whole concept of health insurance back to what it should have been all along -- a safety net against the really bad health catastrophes. Second, by giving employees the funding to pay for their own care when they just get the sniffles, he returns health care to the discipline that all other markets for any other kind of service have to face -- consumers making careful decisions about how to spend their own money. [...]

The article goes on to explain how the Obamacare approach is the exact opposite of what whole foods has done, and what it will mean in practical terms if it's forced on us:

[...] If Whole Foods had to switch over to an Obamacare-style approach, its costs of doing business would rise. And his employees would not be pleased, either, because under his enlightened approach to management he's already crafted his company's health benefits to reflect his employees' stated wishes. As he puts it, "Our plan's costs are much lower than typical health insurance, while providing a very high degree of worker satisfaction."

Labor is the largest cost for most companies. Benefits are the fastest-growing component of labor costs. And health-care insurance is the fastest-growing component of benefits. If Obamacare is enacted, labor costs are only going to go higher -- which means that corporate profits will have to go lower, unless companies pass the costs on to consumers.

Any company CEO -- and all the more so, people who run small businesses where labor costs are high and profit margins are already slim -- needs to be concerned about this. But Mackey is coming from another place, as well.

He's pointing out the very good news that corporate profits and providing generous health benefits don't need to be at odds. He's already found the way -- he just needs to keep government from messing it up for him and his workers.

And yet Mackey has been demonized for expressing these views in print. Left-leaning bloggers have tried to organize a boycott of Whole Foods to punish Mackey. [...]

It's scary how they are gong after Mackey to silence him. The article goes on to say how the people who think health care is a right, seem to think that free speech isn't. It also says we have a chance for REAL healthcare reforms that WORK, if people like John Mackey persist in speaking out, and don't cave in to the pressure of threats to silence them.

Be sure to read Mackey's brilliant piece in the WSJ:

The Whole Foods Alternative to ObamaCare
Eight things we can do to improve health care without adding to the deficit.

Yes, eight things that will work, without raising the deficit, that the Obama Administration doesn't want you to hear about.


Also see:
Healthcare debate: "Bring your ideas to the table?" or “Agree with us, or we’ll crush you?”

UPDATE: The union fatcats behind the Whole Foods boycott
     

Healthcare debate: "Bring your ideas to the table?" or “Agree with us, or we’ll crush you?”

The latter seems to be the message for John Mackey, CEO for Whole Foods, who dared add his voice to the healthcare debate by offering his ideas:

The Left boycotts Whole Foods...

[...] In short, Whole Foods is everything leftists talk about when they talk about “corporate responsibility.”

And yet lefties want to boycott the company because CEO John Mackey wrote an op-ed that suggests alternatives to single payer health care? It wasn’t even a nasty or mean-spirited op-ed. Mackey didn’t spread misinformation about death panels, call anyone names, or use ad hominem attacks. He put forth actual ideas and policy proposals, many of them tested and proven during his own experience running a large company. Is this really the state of debate on the left, now? “Agree with us, or we’ll crush you?”

These people don’t want a dicussion. They don’t want to hear ideas. They want you to shut up and do what they say, or they’re going to punish you. [...]

Letter from a Whole Foods worker
Follow the link for the letter, and a copy of the flyer that picketers from the UFCW are passing around in an effort to damage and silence Mackey. But this following bit is taken from a post on the Whole Foods Forum:

[...] Do You Know Who You Are Boycotting?
posted at 8/21/2009 7:05 AM CDT

* Mackey lectures at Universities about the horrors of factory farming

* He says “Right now, Americans have to pretend factory farms don’t exist. They turn their eyes away, because there’s no alternative, there’s no choice. Once there is a choice, we will allow ourselves to be outraged.”

* He makes $1 a year and donates his stock portfolio to charity.

* He set up a $100,00 fund to help his employees with personal problems.

* He’s a vegetarian and his company will not buy from producers that treat their animals unethically.

* He flies commercial, rents the smallest cars, and stays in the cheapest hotel rooms - not because he’s cheap, but because he has no need for largesse

* He and his wife participate in yoga

* He gives over $1 million a year to animal welfare groups, education, relief work, and spiritual movements.

* Employees have full say in who they work with - a new employee must receive a 2/3 vote in order to make it past probation.

* Employees also vote on all company-wide initiatives

* There’s a salary book in every store - “no secrets” management believes everyone should know how much everyone else is making

* Executive salaries are capped at 14 times the lowest workers salary - If they want more money, everyone else has to get more money first

* Non-executive employees hold 94% of company stock options

* Pay is linked to team performance - profit sharing

* At least 5% of annual profits go to local charities

* Full-timers get 100% of their health care costs paid for - under plans the employees have selected

* “They just have a lot more respect for you as a person here” says an employee

And because he had a different idea about how the United States can fix it health care situation, none of this matters? He’s a caring person and many of you want to treat him like a monster. Why? Not because he opposes reform, but because he’s bringing more ideas to the table.

You people are despicable. If the country had more CEO’s like Mackey, this country would be a greater place.

I remember when health care savings accounts were first created, Whole Foods offered to contribute matching funds to their employees who would open one. They were thrilled, because they could use those funds to buy alternative medical treatments like acupuncture and chiropractic etc., that conventional insurance often would not cover. They were thrilled, because they now had more choices available to them.

It was exactly the opposite of “Agree with us, or we’ll crush you”, which seems to be increasingly the mode of operation that the Democrat Party is preferring to use. It's unbelievably ugly.
     

Health care solutions without Socialism

If you listen to the MSM, you would think that socialism is the only solution available for fixing health care in the USA. It's a ridiculous assumption, when you consider how many people DIE while waiting for treatment in countries where the government controls health care. If America embraces socialist medicine, where will the Canadians go for their health care? We need to fix what we have, not copy an inferior system.

During World War II, wage controls in the US prohibited cash raises, so employers started giving non cash benefits, like health insurance, to attract workers. After the war, the practice continued. Now decades later, many Americans have unfortunately gotten the idea into their heads that their employer is responsible for providing their health care. There is an assumption that it's someone else's responsibility to provide it for us, instead of providing it for ourselves.

If employers stopped providing health insurance, and we were allowed to shop around and buy our own insurance across state lines from whoever we chose, the free market would sort it out, competition would drive prices down making insurance rates much more affordable. Why should it be forbidden to us to buy health insurance from an insurer in another state? Restricting competition is keeping prices so high; the free market isn't given a chance.

The Democrats keep advocating "Socialized" Medicine, more government, as the answer, despite it's abysmal record elsewhere. What are conservatives offering? Not enough, it would seem. I think that is why we are seeing Socialist "Republicans" like Mike Huckabee gaining popularity. People want affordable health care. Conservatives have ideas for achieving that, but are they doing enough to bring it about? Unless costs are brought down, the answer from most people would probably be "no".

Yet there are non-socialist solutions to be found. Republican Mitt Romney, while Governor of Massachusetts, tackled the problem by creating universal health insurance without new taxes or government agencies:

Romney to the Rescue

[...] As the new governor, Romney consolidated state agencies, cut employees, and closed what he called loopholes in the corporate tax code. He also tackled the most difficult public policy issue of all, health insurance.

With input from the Heritage Foundation, Romney came up with a way to provide universal health insurance by requiring that everyone buy coverage, just as drivers are required to buy car insurance. If they don't, they lose their personal exemption on their state income taxes and part of their state tax refund. The idea was that in a reformed marketplace, everyone has the responsibility to have health insurance - no more free riders.

For those who cannot afford coverage, Romney cobbled together funds from Medicaid and the state's free-care pool to make sure everyone is covered.

By merging individual and group plans, Romney covered more healthy individuals, lowering prices.

[...]

Romney likes to contrast his health-care plan with the one proposed by Sen. Hillary Rodham Clinton, D-N.Y. "My plan is based on personal responsibility and allowing the free market to work in a more effective manner," he says. "Her approach was to build a large government bureaucracy and provide more controls to help the health-care system work."

He adds with a smile: "Perhaps the biggest difference between our two plans was that mine got passed, and hers didn't."

States such as Iowa, California, and New Jersey are looking into adopting the Massachusetts approach, and Bush is pushing other states to look into it. To conservatives who bristle at the idea of an imposed plan, Romney says, "The key factor that some of my libertarian friends forget is that today, everybody who doesn't have insurance is getting free coverage from government." [... ]

I'd like to see more ideas like this from Republicans, more private sector and free-market solutions. That is an arena in which Romney excels, and hopefully we will be hearing more from him on this important issue. Here is another solution without government involvement. From Nealz Nuze:

PRIVATE HEALTHCARE ... SAY IT AIN'T SO!

Somewhere across the country, a Hillary staffer is having a breakdown ... private healthcare offered directly from doctors? This is going backwards for the universal healthcare nuts. We need more government, not less! But now we have this program in Rhode Island called HealthAccessRI. You pay $30 for a "membership" in a primary care doctor's practice and you get 24-hour telephone access, sick visits, well child care, check-ups, school and sports physicals, family planning and yearly physicals. Each office visit is just $10. Thirty dollars! That's less than a cell phone bill or one tank of gas. Now this is not an insurance program – and politicians are already quick to point that out – but it offers an affordable solution for primary care. And it didn't take government to do it! All it took was a group of doctors. The private sector! There are now 21 participating doctors, brought together by Michael D. Fine who is taking the program statewide. [...]

Why can't we have more solutions like this from the private sector, that cut out insurance completely? Affordable pay-as-you-go treatment?


Related Links:

How to fix healthcare

Lowering Health Care Costs for Everyone

Health Insurance and Medical Expenses

There's No Place Like Home:
What I learned from my wife's month in the British medical system.

Lowering Health Care Costs for Everyone

From In order to bring health care costs down, it's important to understand what makes them so artificially high. John Stossel at Real Clear Politics sheds some light on this important issue:

Control Your Own Health Care

Candidates for president have plans to get more people health insurance. Some would compel us to buy it; others would use the tax code to encourage that. Regardless, insurance is the magic that will solve our health-care problems.

But contrary to conventional wisdom, it's not those without health insurance who are the problem, but rather those with it. They make medical care more expensive for everyone.

We'd each be better off if we paid all but the biggest medical bills out of pocket and saved insurance for catastrophic events. Truly needy people would rely on charity, not government, because once government gets involved, unintended bad consequences abound.

If people paid their own bills, they would likely buy high-deductible insurance (roughly $1,000 for individuals, $2,100 for families) because on average, the premium is $1,300 cheaper. But people are so conditioned to expect others to pay their medical bills that they hate high deductibles: They feel ripped off if they must pay a thousand dollars before the insurance company starts paying.

But high deductibles may be the key to lowering costs and putting you in charge of your health care.

Five years ago, the Whole Foods grocery chain switched to a high-deductible plan. If an employee has a sore throat or a sprained ankle, he pays. But if he gets cancer or heart disease, his insurance covers it.

Whole Foods puts around $1,500 a year into an account for each employee. It's not charity but part of the employee's compensation. It's money Whole Foods would have otherwise spent on more-expensive insurance. Here's the good part for employees: If they don't spend the money on medical care this year, they keep it, and the company adds more next year.

It's called a health savings account, or HSA.

CEO John Mackey told me that when he went to the new system, "Our costs went way down." [...]

(bold emphasis mine) The article goes on to describe the many ways this plan has worked out to benefit both the employer and the employees. I have high deductible health insurance, and a Health Savings Account. All my deductible medical expenses can be paid out of that account; Dentist, Optometrist, Doctor, Chiropractor, even Acupuncture if I want it. With insurance, I'd have to have separate Dental insurance. Eyeglasses or contacts are not always covered. Alternative medicine like Chiropractic and Acupuncture are often not covered by insurance. The HSA account allows ME to choose the kind of care I want, and how much I want to spend on it.

Last year I had a severe gall bladder attack; before the year was over, I had surgery to have it removed.

I used up all the money in my HSA account, but not long after that, my high deductible insurance kicked in, so I didn't end up spending a lot out of pocket. But I was also in charge; I wasn't sure I wanted the surgery, and was able to explore options and have addition tests, because I was paying for them, not the insurance company. That experience has made me a BIG believer in HSA accounts.

Read the rest of Stossel's article to see the affect this freedom has had on Whole Foods Employees. The freedom to choose works out best for everyone.


Related Link:

The Democrats corrupt use of children; lying to promote government sponsored health care:

Graeme Frost and the perils of Democrat poster child abuse
I feel sorry for the kids; it's not their fault that their parents couldn't be bothered to buy health insurance, but spent their money instead on things like business real estate and private school tuition for their kids, among other thingsWhat a sham. It would seem the parents feel entitled to spend their money on luxuries, while the rest of us pay for their insurance.

This isn't the first time Democrats have used children falsely to promote government health care. Remember what Hillary Clinton did in 1994:

Hillary's poisoned poster child

The Media was there while Hillary was using this child as a prop, but where were they when the real sordid story broke out?