The American Spectator

In an era when health care policy is increasingly framed as an intractable labyrinth only Father Government and Mother Bureaucracy can lead us out of, it is a bold move to publish a book entitled America’s Health Care Crisis Solved. To the credit of authors J. Patrick Rooney and Dan Perrin, however, the title becomes less audacious and more persuasive with each ensuing chapter. This book may very well be the best single volume primer on modern health care policy currently in existence, covering both the challenges — abuse, graft, pure immorality, much of it enabled by past ill-advised “reform” efforts — as well as potential free-market fixes that could help avoid a disastrous government takeover. For a myriad of converging reasons, none of this will be painless or simple. Dan Perrin was nevertheless kind enough to recently sort a bit of the mess out for TAS recently.

TAS: You argue in America’s Health Care Crisis Solved that a Just Say No approach in the near future could land conservatives with the national health care policy they’re ostensibly attempting to avoid.

Dan Perrin: The political system in the United States is reacting to real and serious health care issues that need to be addressed, cost and affordability chief among them. The average family plan in the U.S., just for the premium, not counting deductibles or co-insurance, costs $12,106 a year. How unaffordable must health insurance become before everyone just can’t afford it, and want a Canadian-style system? We must make health care affordable for everyone to avoid this result. Political battles, especially ones involving nearly 20 percent of the Gross National Product of the U.S., can’t be won by saying no with a system so clearly in need of reform. It is like standing up in public and saying the laws of gravity have been repealed. The coming fight on health care must be won with positive ideas that will reform health care and make it better for everyone.

TAS: What is the biggest mistake the conservative movement is making in regard to formulating workable health care policy?

DP: Successful Republicans — Speakers Gingrich and Hastert, President Bush and Senator McCain — have all made health care reform a big part of their election campaigns and legislative agendas. Health care can be a winning issue for Republicans. Karl Rove, for example, made a point of making Education and Health Care reform central to the two campaigns Bush ran and won. Health care reform is not a universal winner for the Democrats. The Clinton Health Care Plan failed, and cost the Democrats control of the U.S. House. Their next big health care legislative initiative, the Patients Bill of Rights, also failed. In fact, the two biggest pieces of health care reform legislation that has become law is the HIPAA legislation that contained the Medical Savings Account pilot plan, and the Medicare Prescription Drug bill that had the Health Savings Account provision. Republicans have successfully reformed health care twice, while the Democrats have failed twice on their biggest initiatives. Why are Republicans gun-shy on an issue they have a record of success on? Why is the perception that the Democrats can only reform health care, when, in fact, the reverse is true?

TAS: The history you sketch of the development of health insurance in the United States is incredibly enlightening. How did we get to where we are?

DP: The current tax break for employer-provided health insurance is rooted in the wage and price controls implemented during World War II. In order to attract and keep workers, companies had to offer something other than a higher salary to be competitive. Health insurance soon became the currency of a raise, and higher premium plan was a bigger raise. A higher premium had a lower deductible, and therein is the birth of the love affair with low deductible, high premium plan.

TAS:One of the things you and your co-author advocate is allowing patients to go directly to a specialist without passing Primary Care Physician. You call this, Get it right the first time. Could you just as easily apply the same phrase to free-market heath care reforms?

DP: Your question assumes that reforming health care is easy — it is not. Of all political and legislative action, health care reform [must contend with] the inherent American cultural problems faced by any government control of health care; lack of most Americans’ desire to take risks or innovate with their health care; gun-shyness of both political parties when it comes to health care reform; $1 trillion worth of influence and power of the special interests arrayed around U.S. government health care spending; tensions within the Democratic Party between the 90 Medicare for All U.S. House co-sponsors, and those Democrats who would rather do something else; and the massive growth in the current health care spending by the U.S. government on Medicare, Medicaid and the employer provided tax break — leaving little new money to work with for any reform plan.

Each of these represents a high degree of difficulty for any reforms to overcome and be passed into law. Taken together, there is an extremely high level of difficulty. Add into the above that changing the tax code is the most difficult of all types of legislative action to achieve, and the level of difficulty of health care reform just became the most difficult type of legislation to pass of any kind in the United States.

TAS: Some religious institutions, you note, have been behaving very badly, using a supposed biblical mission to avoid gargantuan tax bills but doing absolutely nothing charitable for the poor or needy. The rot here is fundamental. How will health care institutions regain people’s trust?

DP: Public humiliation and self-flagellation work well, and so does threatening to take away their charity tax break, in terms of forcing behavior modification. Pinning health care inflation on the hospitals, which is where it belongs, will also help. But the final solution is to make hospital prices transparent to foster competition on price, just like there is for Lasik eye surgery, which has resulted in better results at much lower costs.

TAS: One of the most shocking things revealed in your book is how much more the uninsured are billed than Medicaid or private insurance for identical procedures.

DP: President Clinton gave the hospitals a waiver on the anti-trust laws, and the health inflation we have experienced over the last decade is the direct result.

TAS: What can individuals do to help prod sane reform along?