Competing visions on taxes, policing define race

State Sen. Alex Kasser has voiced her support for the “public option” as a means of providing affordable health care. Although it sounds appealing to allow private citizens and small businesses to purchase health insurance through the government at a discounted rate there are problems with this idea. The obvious appeal is that because the government purchases health insurance for a large number of people and spreads the risk over a large number of members health premiums are lower.

Sounds good so far, but there is far more to the picture that is not. Because the government is a nontaxed, nonprofit entity in the short run it can offer insurance at a lower price than private insurance companies. This would be true until the time when insurance companies could no longer compete with the government plan and go out of business. We would be then left with a totally government run health care system. When the government no longer has to compete with insurance companies its inefficiencies, bureaucracy and politically driven agenda will take over healthcare. Costs would rise, choices would be eliminated and budgetary issues would determine how health care would be rationed.

The reimbursement to hospitals, physicians, and other providers would fall and access to care would decline. Years ago for example I was told by a reliable source that Montefiore Hospital in the Bronx, New York, lost $6,000 on every Medicaid delivery. Private insurance and charitable contributions had to pick up the slack. When there is nobody to pick up the slack, which is what happens in a government run system, hospitals especially in our poorest cities and neighborhoods, will continue to hemorrhage money and without massive state subsidies be forced to close.

Beyond any doubt we need to fix our health care system. We need to enable small businesses and individuals to join forces and purchase healthcare as larger entities to get economies of scale, spread risk and not penalize individuals with pre-existing conditions. This is best done by creating the flexibility in our health care system that encourages innovative healthcare solutions.

Our regulatory system at the state and federal levels stifles competition. increases regulatory costs and has led to health care consolidation and higher costs. Connecticut needs to create an innovation and competition friendly health care environment. The first steps to lower health care costs are intelligent deregulation and the encouragement of innovation in health care.

Because our tech industries have had the flexibility to innovate and constantly change amazing things have happened. Let’s do the same with health care.

Michael T. Goldstein, M.D., J.D. Greenwich