During his ABC infomercial last week, President Obama continued to insist that the type of reform he has in mind would reduce the cost of health care, improve its quality, and enable people to keep their current insurance policies and doctors. He is wrong on all counts.
Very little in the Democratic bills making their way through Congress would do anything to reduce costs, while the new subsidies their authors envision would increase costs. That is why the Democrats are talking about both explicit and disguised tax increases. During the ABC special, the president hinted that reform would give doctors and hospitals new incentives to avoid unnecessary care. But since government cannot reliably distinguish between the necessary and the unnecessary, all it can do is encourage less care — and leave it to doctors and other health-care workers to administer the rationing. Obama would be well-advised, for his political health, to do no more than hint at this prospect.
Obama wants to establish a government-run insurer. Because it could pass along its costs to its private-sector competitors, that insurer would quickly come to dominate the market, regardless of its quality. (All estimates agree that many millions of people would lose their existing coverage.) It would thus strengthen the government’s ability to reshape health care to its specifications. Obama seems entirely too confident that it could do so intelligently.
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The better course would be to make it easier for people to buy insurance policies for themselves and their families, so that they would not have to rely on either the government or their employers. Under such a system people would run less of a risk of being denied care that they want, and would also have an incentive to keep an eye on costs. And in a market less fragmented on the basis of employment status, individuals would be better able to buy renewable insurance policies that they could keep even after getting sick.
President Obama could easily get such a plan through Congress if he wanted it and were willing to face the wrath of the Left. By pursuing his political and ideological ambitions, he is risking getting no bill at all — or, worse, one that takes America in the wrong direction.
