Medicaid Expansion Is The Opposite of What We Should Do To Fix Healthcare
A major goal of national health care policy makers has been reducing the number of uninsured. This is why Obamacare began as single payer, moved to a public option, and finally settled on Medicaid expansion. This insurance-centric policy push is simply wrongheaded.
The biggest problem with our health care system is rapidly rising costs. Though it’s tailed off a bit the last few years, health care cost growth still outpaces inflation, and insurance premium cost growth far outpace wage increases, putting a major crimp on household budgets. But simply transforming the government into a giant insurance company doesn’t address those fundamental problems.
The transfer of who pays for health care, whether through private insurance or through government, has been a long process. In 1960 a health care consumer – you and I – paid 48% of our health care costs. Today, it’s just 12%. So who pays for it today? Private insurance picks up 30% of the tab. But the government has been the biggest mover, paying for only 24% in 1960 and rising all the way to 48% today.
Think about that. Government, with its price fixing and rigid treatment plans, accounts for almost half of all the health care purchased in this country. And yet policy makers would have us believe the “free market” is the problem.
Over the last 50 years we’ve flipped how health care is paid on its head, and have seen costs rise exponentially. Shouldn’t that set off alarm bells? At the very least a raised eyebrow?
Perhaps most frustrating is that we were warned. We had the data to predict this outcome years ago.
The largest health care study ever was conducted during the 1970s by the nonprofit RAND Corporation. Researchers studied health care outcomes and purchasing behavior of people with free health care and those who paid varying degrees of their health care out of pocket. What they found is equal parts astounding and quite obvious.
First, the obvious part. The group that paid 95% of their own health care costs spent 30% less than the group who got their health care for free. Which of course makes sense.
But what today’s policy makers would have you believe is that when people pay for their own health care they put off wellness check ups and preventative services which results in more serious illnesses and costs later on. But today’s policy makers are wrong.
Researchers found that the 95% health care payer group not only spent 30% less, but they were just as healthy as the people who had all their health care paid for. In fact, they were just as healthy, just as happy with their providers, used fewer services, and were actually less worried about their health than people who paid nothing.
Doesn’t that sound like a desirable health care policy outcome? Happy, healthy, stress free patients. And a 30% cost reduction to boot! Not to mention a whole lot less hassling with insurance companies.
Tragically, the ACA and its corresponding Medicaid expansion does the exact opposite. Its overriding goal is adding more layers of insurance companies and government sponsored free health care, locking in that needless, wasteful 30% spending increase.
We’ve spent the last five decades ignoring the science behind spending on medicine, and now we’re stuck swallowing the bitter pill of skyrocketing costs. But there is a cure. We need to refuse the ACA’s mandated Medicaid expansion, unwind the dizzying regulatory health care environment, and promote policies that simplify the relationship between you and your doctor.