If conservatives don’t counter them, government-run health care will be here to stay.
With the fight over the future of the United States health care system now upon us, conservatives find themselves at a tremendous disadvantage. The Democrats are in control of the White House and Congress and they now count as allies many of the same special interest groups, such as insurers, who opposed the push for HillaryCare in 1993 and 1994. But the biggest obstacle conservatives face is that for decades they have allowed many myths and misleading facts about health care to permeate the national consciousness and rig the debate in the favor of those who want to expand the role of government. The only hope that conservatives have of winning the debate is to challenge fundamentally some of the leading assumptions people have about health care. While there is a lot of misinformation to parse, TAS has compiled a list of some of the most pernicious myths in need of debunking.
The Myth: The United States has a free market health care system.
Why It Matters: An April CBS News/New York Times poll found that 87 percent of Americans believe that the U.S. health care system needs to be fundamentally changed or completely rebuilt. While such numbers may differ depending on the poll, it’s clear that an overwhelming majority of the public believes the system requires substantial reform. Because Americans are given the false impression that the current health care system that they view as flawed is a free market, they are more open to remedies that involve an expanded role for government.
The Reality: Both in terms of direct spending and regulation, government plays a dominant role in health care and impedes the formation of a marketbased system in the U.S.
In 2007, the cost of all government health care programs at the federal, state, and local level added up to more than $1 trillion, representing 46 percent of the $2.4 trillion in total U.S. health care expenditures, according to the Centers for Medicare & Medicaid Services. That same year, an analysis of Kaiser Family Foundation data shows, 31 percent of those covered received their health insurance through the government. While the rest of the nation obtains its health care privately, government policies still distort the insurance market.
The most significant way the government meddles in the market is through the tax code, which discriminates against those who purchase insurance on their own to the benefit of those who are insured through their employers. The policy dates back to 1943, when the Internal Revenue Service ruled that workers did not have to pay taxes on health benefits purchased through their employers. With wage and price controls in place during World War II and labor scarce, many employers took advantage of the favorable tax status and offered health benefits to attract workers, and this later became enshrined in the tax code.
As a result, by 2007, 63 percent of the insured population was receiving their coverage through their employers. Having such a system restricts choice, because workers are limited to whatever health benefits are offered. It impedes mobility, because insurance cannot be taken from job to job. It compounds the problem of unemployment, because losing a job often means losing one’s health care. And ultimately, it drives up spending—since most Americans don’t have to pay the out-of-pocket costs for their medical care.
Roughly 6 percent of the covered population purchases its own insurance without the tax advantages enjoyed by those who obtain it through their employers, but even then they must navigate a highly regulated individual market that leaves them with few options. Many states impose onerous regulations on insurers requiring them to provide certain benefits. Some of the benefits insurance companies have been forced to cover include in vitro fertilization, morbid obesity treatment, and lockjaw disorders. Currently there are nearly 2,000 benefit mandates nationwide, according to the Council for Affordable Health Insurance, driving up the cost of polices by 20 to 50 percent, depending on the nature of the mandate.
That means that even if a person who is relatively healthy wants a cheaper, basic plan that would cover him in the event of a sudden catastrophic illness or freak accident, he’s still forced either to purchase expensive comprehensive coverage or go uninsured.
However one would describe the convoluted U.S. health care system, a free market it is not.
The Myth: 46 million Americans are without health care.
Why It Matters: Whether it’s in political speeches, commentary, newspaper features, or hard news stories, the statistic of 46 million uninsured is one of the most widely cited numbers in the health care debate. It promotes the idea that nearly one out of every six Americans does not have access to health care and it plays into the arguments of those calling for massive expansion of government to fix the problem.
The Reality: The ubiquitous statistic is not pulled out of thin air. It comes from an annual report by the Census Bureau, which most recently pegged the number of uninsured at 45.7 million for 2007. But the problem lies in the way the statistic is commonly cited and understood.
For starters, the statistic does not mean that there are 46 million uninsured Americans. Just a quick look inside the Census Bureau data shows that 9.7 million of the uninsured are not citizens of the United States. Liberals can argue that we still have a moral duty to cover non-citizens, but this doesn’t change the fact that as a matter of accuracy, the Census data only tells us that 36 million Americans are uninsured.
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