Recently, I heard someone say,
"I’d rather trust the "Free Market" to make health care rationing decisions, rather than some government bureaucrat, like they do in Canada and Great Britain."
Yes, the "Free Market" has worked so well for us in these last 8 years.
What if Bush had been able to get Social Security privatization passed like he and Wall Street wanted? And then we found out we lost it all because of deregulation and "imprudent" investments in securities that had been rated falsely as good investments?
Wall Street and the "Free Market" gave us the financial meltdown that began in 2008, and it is ongoing. When one of the dominoes fell, they all fell, just like in any Ponzi scheme.
If Social Security had been privatized, there would have been riots in the streets when the citizens without Social Security after the crash learned who was responsible. The AIG building would have had no exterior glass panels intact.
Alan Greenspan actually admitted that the "Free Market" theory was flawed:
Former Federal Reserve Chairman Alan Greenspan said a "once-in-a-century credit tsunami" has engulfed financial markets and conceded that his free-market ideology shunning regulation was flawed.
Yes, I found a flaw, Greenspan said in response to grilling from the House Committee on Oversight and Government Reform. "That is precisely the reason I was shocked because I'd been going for 40 years or more with very considerable evidence that it was working exceptionally well."
Greenspan said he was "partially" wrong in opposing regulation of derivatives and acknowledged that financial institutions didn't protect shareholders and investments as well as he expected.
Our health care system is in a shambles, and we are paying a larger percentage of our earnings every year for less coverage. We are worse off because of "Free Market" theories being applied by private insurance companies to something that is not a commodity: health care.
In reality, I am not against "Free Market" concepts when applying them to most goods and services. The problem is that for the "Free Market" to work, it must not allow fraudulent activities. The rules must not be broken. There must be a level-playing field for the market to reward good products and services.
However, businesses hunt day and night for opportunities to get around laws and regulations in the hope of gaining an unfair advantage. Without strict regulation, the "Free Market" cannot operate efficiently. Law-breaking and bribes to government officials (see Jack Abramoff) provide one company with a competitive advantage over another. The company with the poorer product makes it while the company making high quality products goes under.
When CEO’s are talking about "Free Markets", you should think "unregulated markets". Regulations threaten to keep CEO’s from maximizing their profits. If regulations are followed, CEO’s may not receive their huge performance bonuses, as reflected in the stock share price. For this reason, corporations try to either get the regulations relaxed, or find ways around them.
When economists are talking about "Free Markets" they are talking about unfettered, legal business activity. They assume a certain amount of self-regulation and integrity. The economist Greenspan was "shocked" to find out that CEO’s were not self-regulating:
Greenspan reiterated his "shocked disbelief" that financial companies failed to execute sufficient "surveillance" on their trading counterparties to prevent surging losses. The "breakdown"' was clearest in the market where securities firms packaged home mortgages into debt sold on to other investors, he said.
Ever wonder why the mavens on Wall Street have to be paid retention money of tens or hundreds of millions of dollar in bonuses each year? It’s not because someone else cannot do their job. It is because the company cannot afford to lose all of the skills and connections gained over years of underhanded dealings.
These Wall Street prima donna’s command such high salaries because they can commit crime like no one else can. Of course, it is not even a crime if there are no regulations placed on the industry. Lack of regulation, and lack of enforcement allow certain individuals and corporations to prosper far beyond their competitors, thus destroying the true "Free Market" nature of a line of business.
Regarding the myths about long lines in Canada and the U.K., there is no "wait-time" for critical or necessary procedures in Canada and Great Britain. They use a process called "triage", and it works quite well.
I don’t like the word "rationing", because it always evokes the fear that some will not get enough of something. "Rationing" would really amount to "triage" under health care reform and this would occur for medical reasons, if at all. In other words, some people without pressing needs might have to wait while others with critical health problems are tended to first. That’s what takes place in every Emergency Department in the country now.
Rationing would be rational under a government plan. However, with private insurers, denial of treatment occurs in order to ensure that corporate earnings are 7% more than the company earned in this quarter compared to the same quarter last year. The CEO must have his performance bonuses. This is not an acceptable reason to ration health care.
The insurance term for any money the insurance company pays out is a "medical loss". That means it's a zero-sum game to them. Either the insurance company wins or the patient wins. If health care reform were passed, doctors and clerks working for the insurance company would not be promoted as a reward for denying citizens health care.
I'll take Medicare's 3 to 4% overhead any day compared to 20% (and growing) for the private insurance company. Nearly all doctors take Medicare and it works just fine.
As a physician myself, I’d like for you to ask any private practice physician what he thinks about private insurance reimbursement. Here’s how it usually goes: First the insurance company holds the payment for three months. When the physician’s billing staff calls, they say that the "claim has been misplaced. Would you please resubmit the claim?".
The physician resubmits, and waits. When his staff calls again, a month later, the insurance company says that they are working on it. They are really just now pulling up the claim out of their files. Then the insurance company sends the physician additional forms to fill out to justify the medical procedure.
After that, the insurance company tells the doctor’ staff that the doctors who are billing the insurance are not actually in the insurance company network and to submit it as an "out of network" claim.
The doctor’s staff has to fax papers and call the insurance company several times to verify that the doctors are in the network. The insurance company’s response? "Oops, sorry. Our fault".
Then one year later, the physician is paid for the services he or she rendered a long time ago. Meanwhile, the insurance company has invested the money not paid out, and made a year’s worth of interest on the physician’s money. By doing so, they are actually taking a loan from the physician’s banking account and then paying it back (finally), a year later, without interest.
Not only does a physician have to earn the money in the first place by taking care of the patient, he or she has to earn their money again trying to collect payment from private insurers, many of whom have been sued by the Federal government for delaying payment to doctors.
Give me Medicare or a Public Option any day over private health insurers. The health insurance industry is to health care what Enron was to affordable energy.