Not buy­ing what Obama’s ped­dling

The Covington News - - Front page -

More pre­scient words were never spo­ken by a politi­cian than Barack Obama’s to the Amer­i­can peo­ple Wed­nes­day evening on the is­sue of health care re­form: “I am not the first pres­i­dent to take up this cause, but I am de­ter­mined to be the last.” For 60 years, Democrats have been try­ing to force a gov­ern­ment health care sys­tem on a deeply skep­ti­cal Amer­i­can pub­lic, without suc­cess. And if Pres­i­dent Obama fails this time, it’s un­likely we’ll see an­other at­tempt any­time soon. But de­spite the pres­i­dent’s re­crim­i­na­tions, he has only him­self to blame.

The pres­i­dent could have used his primetime pub­lic ad­dress to search for a moderate com­pro­mise. In­stead, he chose to call those who dis­agree with him liars and to warn that if Congress fails to pass his plan “more (peo­ple) will die as a re­sult.” And to make mat­ters worse, he claimed he could ex­pand cov­er­age to 30 mil­lion peo­ple who don’t have it now, pay for higher drug cov­er­age for se­niors, guar­an­tee that no one be de­nied health cov­er­age for any rea­son or have their life­time ben­e­fits capped — all without adding “one dime to our deficits — ei­ther now or in the fu­ture. Pe­riod.”

The pres­i­dent ad­mit­ted the pro­gram he’s pro­pos- ing will cost $900 bil­lion (down from over a tril­lion for his orig­i­nal pro­posal) over 10 years. So how will he pay for it without in­creas­ing the deficit? For starters, he claims he can pay for ex­panded health care ben­e­fits for the el­derly by elim­i­nat­ing waste, fraud and abuse — but if it were that sim­ple, why do we need ma­jor new leg­is­la­tion? Why not just sic the Jus­tice Depart­ment or the in­spec­tor gen­eral at Health and Hu­man Ser­vices on Medi­care providers who are cheat­ing the gov­ern­ment now?

And what about the other costs in his plan? Who will pay for guar­an­teed mam­mo­grams, rou­tine phys­i­cals, and colono­scopies that he says in­sur­ance com­pa­nies will now have to of­fer “with no ex­tra charge”? Does he ex­pect doc­tors or med­i­cal tech­ni­cians to work for free or med­i­cal equip­ment com­pa­nies to do­nate their ma­chines? Ap­par­ently he be­lieves it will all come from sav­ings from the ex­ces­sive prof­its in­sur­ance com­pa­nies take un­der the cur­rent sys­tem. But, ac­cord­ing to the Wall Street re­search and rat­ings firm Morn­ingstar, for-profit health care com­pa­nies had an av­er­age 3.4 per­cent profit mar­gin over the last year — rank­ing 87th out of 215 in­dus­tries.

The pres­i­dent claims he has “no in­ter­est in putting in­sur­ance com­pa­nies out of busi­ness,” but that is ex­actly what will hap­pen if the gov­ern­ment forces them to ex­pand the ser­vices they cover while si­mul­ta­ne­ously pre­vent­ing them from charg­ing higher fees, es­pe­cially if the ex­panded pool of ben­e­fi­cia­ries in­cludes many of the least healthy in­di­vid­u­als.

But maybe Pres­i­dent Obama thinks in­sur­ance com­pa­nies will sur­vive sim­ply be­cause he’ll force a whole new group of Amer­i­cans to be­come cus­tomers. The pres­i­dent now says he’ll re­quire all Amer­i­cans to carry health in­sur­ance — some­thing he said he was op­posed to dur­ing the pres­i­den­tial cam­paign. He im­plic­itly ad­mits that many peo­ple who don’t have in­sur­ance at the present time could af­ford to buy it if they chose; but for those who can’t af­ford it, he still in­sists on a “pub­lic op­tion.” But de­spite the pres­i­dent’s as­sur­ances that “the pub­lic in­sur­ance op­tion would have to be self-suf­fi­cient and rely on the pre­mi­ums it col­lects,” there is no way those pre­mi­ums could pay for the level of care he is in­sist­ing be pro­vided.

He claims that “by avoid­ing some of the over­head that gets eaten up at pri­vate com­pa­nies by prof­its, ex­ces­sive ad­min­is­tra­tive costs and ex­ec­u­tive salaries, it could pro­vide a good deal for con­sumers.” Putting aside the pres­i­dent’s ap­par­ent mis­un­der­stand­ing of the con­cepts of over­head and profit (the lat­ter is what’s left over af­ter de­duct­ing all ex­penses, in­clud­ing over­head and salaries, from rev­enues), what gov­ern­ment sub­si­dized or quasi-gov­ern­men­trun agency has man­aged to keep costs down while pro­vid­ing im­proved ser­vices? The U.S. Postal Ser­vice? Am­trak?

The pres­i­dent is beginning to sound like one of those late-night TV ad pitch­men. But no mat­ter how many times he tries to repack­age his prod­uct or prom­ises the whole thing comes free, Amer­i­cans aren’t buy­ing what he has to sell.

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