G. Keith Smith, M.D.

Imagine that you own a company with 100 employees.  Your company has provided traditional health insurance to your employees at a cost of $45,000/month until about 3 years ago when you discovered that you could “self-insure.”  You made this move because for many years in a row, the dollar amount of the health claims submitted by your employees didn’t amount to the dollar amount of your insurance premiums.  You realized that had you paid for your employees’ health needs out of your operational revenue, you would have been financially better off.  Very simply, you now pay this $45,000/month to a fund/trust you set up within your company, out of which health related expenses for your employees are paid.  You back this “fund” up with insurance that kicks in for catastrophic claims.  

This catastrophic claim deductible (called an attachment point) amounts to your liability or exposure for any given employee’s health needs.  This catastrophic insurance is commonly referred to as “stop loss” insurance.  As a result of your decision to do this, you now have $1,000,000 in this “fund” or “trust” that would have otherwise been paid to an insurance company.  Rather than have an insurance company say what is or is not “covered” you can help your employees with their expenses more personally and more efficiently, having eliminated the insurance company middleman. 

Let’s say that your attachment point is $30,000.  This means that if an employee has $28,500 of health claims in a year, you pay every dime out of your “fund.”  If they have $90,000 of claims, you pay $30,000, the stop loss insurance paying the rest.  This is oversimplified, but you get the idea.

Actuaries make their living by applying mathematical models to help self-funded health plans “guess” what their loss experience will be.  This information helps determine what the attachment point should be and also helps determine what sort of cash reserves a company should keep on hand.  What is the statistical likelihood that one of your 100 employees will develop cancer?  What is the statistical likelihood that 5 of your 100 employees will incur claims of over $30,000?  These are the types of things that, although uncertain, are predictable within limits. 

Part of the problem that actuaries have with their calculations, however, is that one never knows what a cardiac surgery or a hip replacement or a gall bladder removal or a tonsillectomy will cost.  There has been simply no way for actuaries to get this information in advance.  You can see where this is going, can’t you?

The significance of transparent and upfront pricing that we have embraced and that more and more physicians and facilities are embracing is revolutionary for the self-funded plans, as employers taking this approach can now with much more certainty, ascertain the “risk” their plan must endure.  Furthermore, as the costs of healthcare have skyrocketed over the last few years, smaller and smaller companies are venturing down the “self-funded” path, making this decision based on cost savings and partly to maintain some autonomy. 

To quote Jim Epstein from Reason Magazine:  “Enter Obamacare!”  This central planner’s dream catcher has made the risk-benefit proposition of self-funding an even better decision, as self-funded plans are not subject to many of the provisions of this legislation.  I have maintained all along that Obamacare was meant to fail, a Trojan horse meant to introduce chaos and even higher prices into the medical economy, just the nightmare the state needs to justify rescuing us with the sequel…single payer. 

“That’s crazy,” many of you have said!  The Unaffordable Care Act was meant to reduce costs and protect patients and make sure that everyone had “coverage!”  Keep dreaming.  Uncle Sam doesn’t want you to have “coverage.”  Uncle Sam wants you to buy approved coverage, that is, coverage from their crony pals.  That is the purpose of the exchanges.  The price of insurance has already risen, with up to 100% increases in premiums expected (that’s right, doubling) for January renewals.  Residents of states that have embraced Medicaid expansion will (an expansion pushed for hard by none other than the big hospitals) soon hear these same hospitals whining about all of the new Medicaid patients that are not covering the costs of the care they receive and using this as their excuse to continue to aggressively “cost-shift” to others.  Translation?  The charges and costs everyone will see at these big “not for profit” hospitals will escalate, particularly in the states where Medicaid expansion and exchanges are embraced!

Back to the self-funded bunch.  The government can’t just let these businesses stay on the sidelines, refusing to wade into the price whirlpool, can they?  70% of private insurance claims are paid by these self-funded trusts.  The government has made promises to their crony buds in the hospital and insurance industry.  This self-funded bunch must be reigned in or the scheme to mandate the purchase of health insurance through exchanges that will operate under government oversight (rationing) will fail.  As a bureaucrat, how would you devise a plan to stop the growth in the number of companies “seceding” from the system by self-funding and possibly even bring some that are already self-funded into the drowning pool?

The answer is here, here and here.  If the National Association of Insurance Commissioners is successful in destroying the “stop loss” industry in each of the states, few-no companies will take the self-funded risk, as they have no effective “back-stop” for catastrophic losses.  Bingo!  Everyone is now drowning together!  Crisis complete.  There is no doubt whatsoever in my mind that this attempt to destroy or hamstring the stop-loss industry proves that a single payer system is the goal of the statists, a system that will allow the medical industrial complex to extract wealth even more directly from the taxpayers, rather than profit by providing a service to consumers/patients. 

If the state insurance commissioners move (some are already doing this) to raise attachment points or otherwise hamstring this stop-loss industry, you will know that those state commissioners are playing on Uncle Sam’s team.  This stop-loss industry represents the biggest obstacle in this country to a Soviet-style single payer system, in my opinion.  The efforts to crush this industry are not something the “state” wants you to know about, as this will make their ultimate goal even more ridiculously obvious. 

G. Keith Smith, M.D.

The market is in the tank the day after the so-called “election.”  Well…not for everyone.  HCA, Bill Frist’s hospital company, is up almost 10%!  No wonder he stated that had he still been in the senate he would have voted for the Unaffordable Care Act.  Other big hospital and health care stocks are up.  Way up.  Here’s a link to show you.  ”Wow.  This Obamacare must be really good for folks in health care,” you are thinking.  Well..not for everyone.  Wall Street has never cared about the end-user, in this case, the patient. 

Check out the board of directors for Tenet, one of the “winners” of Obamacare.  Jeb Bush?  The former CEO of Electronic Data Systems?  Venture capitalists.  Giant hospital corporate groups.  Sounds like a lot of money is going to go to their investors, diverted from patient care.  Nashville, Tennessee, home to both the giant HCA and Community Health Systems, is in no danger of seeing a free market medical practice there any time soon! 

Think about it.  The market was down at one point, a full 2%.  These healthcare stocks are up in one case about 10%.  That’s really bad news for anyone anticipating paying for healthcare in the near future.  And it is called the Affordable Care Act!  Ha!

The socialist John Boehner isn’t helping things by saying on TV just now that he’s in favor of tax increases if combined with “tax reform,” whatever that means.  Seriously, what’s the difference between any of these guys? 

The answer to Rothbard’s cui bono, who benefits from Obamacare, will become increasingly clear over the next few months.  Actually, it’s pretty clear now, isn’t it.  I know who won’t like it.  Almost anyone paying for health care and most folks on the receiving end of it. 

Pockets of resistance, “free trade” areas of healthcare are out there and will attract more and more patients and those paying for health care, as the system implodes.  I’ve written for some time now that this was the intention of this act, the implosion of the system, as this will usher in phase 2 of their plan, single payer.  Barney Frank, you’ll remember, let this slip during the debate about Obamacare during an interview. 

If you think the hospital stocks are high now, wait until single payer arrives.  That coupled with a dollar that will only buy a fraction tomorrow of what it buys today will render corporate hospital stocks that we’ll need a slide rule to keep up with.

G. Keith Smith, M.D.

Great Britain, just like the U.S., is going broke.  Entitlement spending will be their doom.  Their National Health Service costs 158 billion dollars a year to run.  ”But health care is free there!!”  These blokes have come up with an idea that might jolly well keep their system alive.  We bloody well can’t let the staff run out of the supplies necessary to euthanize the sick inpatients now can we?  Seriously.  The NHS admits that 1/3 of all patients that die in their hospitals are euthanized.  

So here’s their idea.  Public hospitals in England should set up profit-making branches in other countries!  Jill Lawless, writing for the Associated Press writes, “Officials said the country should capitalize on international respect for the British health care brand.”    Later, “Health Minister Anne Milton said that plan would create jobs and revenue, which would be channeled back into the health service.” 

Many of you are laughing right now.  Aren’t central planners fun?  Probably not when they deny you dialysis (remember it’s free) or murder a sick relative to free up a hospital bed.  I think they should give some thought to flying a “Jolly Roger” flag at each of these branch hospitals.  What a great logo for their “brand.”

Put yourself in the shoes of a patient walking in to one of these facilities.  However much you are charged, it will be too much, as the mission of this hospital will be to charge enough to cover the cost of your care and that of the folks back home.  Why would anyone patronize a facility with this mission?  Why wouldn’t someone else set up a hospital and charge a fair rate, charging only for your care?  How long would foreigners endure being overcharged to bail out the mother ship?

How will the NHS do a price calculation for their services?  I suggest that if they really want to make a profit they should contract with one of the “not for profit” hospital chains here in the states for a lesson in aggressive billing, or just sublet the facility out to them.  I suppose they will consider some “tax” like a VAT, added to the hospital bill but call it a TAB, for “thanks a bunch!”  

Will the British doctors operate in a for profit manner, or be salaried like back home, while the hospital acts in a “for profit” manner?  I’m thinking that if the doctors don’t care whether they are profitable, this hospital can call itself “for profit” all it wants….it will not make a dime!  On the other hand, if the doctors are offered a chance to work in a “for profit” fee for service manner in Dubai, there may not be any doctors left in England!  

What happens when a competitor hospital opens up, charging a fair rate, without the TAB?  If any talented British doctors go to Dubai, won’t they go to work for this facility not owned or operated by the NHS?  What sort of doctors would remain working in an NHS hospital when the competitor, charging probably half for better care, shows up, offering the doctors a fee for service setup?

Will they use the Liverpool Care Pathway to euthanize resource-intense patients who aren’t profitable in these new facilities?  Will they bring staff trained to simultaneously starve and sedate the sick?  Exporting these skills might actually be a good idea for the care of those remaining in England!

What does this arrangement say about the “free health care plan” back home in England?  What better evidence of failure could there be, that “for profit” hospitals need to be built all over the planet to support the bankrupt and failed system back on the home front?  Their socialism only works if allowed to piggyback onto a “for profit” system elsewhere.  What a message!

Or will the old British accent portray a higher IQ than justified, making this a brilliant marketing move, an unbeatable strategy?  Even so, what makes them think that the free market won’t create a better priced Harley Street in Dubai, as patients realize their scam? 

G. Keith Smith, M.D.

What will single payer health care look like?  There are so many places to look it’s a little confusing.  Here’s a partial list.

Canada

I pick on Canada a lot.  Why?  Lots of Canadians come to our facility for their health care.  Do I really need to say anything else?  These are people who have been told to wait for years before they can see a specialist (because there are budget “caps”).  When the money is gone, the doctor’s office is closed.  Surgeons are limited on the amount of operating room time they can have in a month.  When they have used up their time, they can do no more surgery.  Rather than have the market determine the allocation of resources, a Canadian bureaucrat creates a budget and that’s that.  Presto!  This is how the “right” to health care is born.  Doesn’t feel like a right to health care for those who come to the states for their care, though.  Probably doesn’t feel like that to the patients who die waiting in line for care, I’ll bet.  Imagine that the government guaranteed a “right” to blankets.  They then dictated how long the blanket makers could stay open manufacturing blankets.  Is it really that surprising that this approach would lead to lots of shivering blanket-less people waiting in line for their ration?  

Great Britain

I like to pick on the Brits because they harbor such nationalistic pride in regards to their health care system, even though it is based on the same faulty economic premise as their Canadian brethren.   I like to pick on the Brits because they not only euthanize their sick citizens to free up scarce hospital beds (duh…wonder how this shortage of beds came about?) they are proud of this and have even given this highway to the cemetery  a fancy name:  The Liverpool Care Pathway.  British patients that become extremely ill have a better chance of survival at home, surrounded by family and friends, as no one stands a chance once on the Pathway.  Recovery from severe illness can occur without the help of modern medicine, but recovery of the very sick isn’t likely when the hospital staff is actively murdering them.  

But there is no need to go outside of the U.S. to see the wonders of socialism in medicine.  The VA hospitals and the Indian hospitals provide examples of the wonders of efficiency brought to us in medicine from government bureaucrats.  

Our local paper’s lead article today informed us that the Department of Public Safety (office administering driver’s tests) was closing their offices for the day to participate in training their employees on how to be more efficient and friendly.  Zeke Campfield of “The Oklahoman” writes that the “operator of a local Chick-fil-A restaurant will teach examiners how to be patient and courteous.”  Wow.  That can be taught?  And in one day?  

What would happen to an employee at Chick-fil-A that was not patient with and courteous to customers?  What would a patron of Chick-fil-A do if they were not treated in a timely manner and with respect?  What would happen to Chick-fil-A if this treatment of customers were widespread?  

Campfield’s article also talks about a mother getting in to line outside of the testing center at 4:15 am, only to be turned away at the end of the day because there were simply not enough examiners to get to her son.  Three mornings in a row.  The spokesman for the Department of Public Safety muttered something about budget cuts so I’m guessing we’ll see government’s usual response, that of throwing even more money at failure.  

Try to imagine the Department of Public Safety in charge of your medical care.  Rude and inefficient staff.  No competitive fears.  Hospitals working together to institutionalize mediocrity so no one stands out as better, eliminating troublesome comparisons.  Long waiting lines.  Always blaming the lack of funding or budget caps.  

The efficiencies and quality of the private sector cannot be superimposed on government agencies for one simple reason:  without competitors, government doesn’t have to care.  Ever.  Our state government wants to introduce private sector ideas into a failed government organization.  Ironic, isn’t it, that nationally, health care bureaucrats are increasingly embracing the business plan of the Department of Public Safety (DPS), even as the DPS is looking for private sector answers?  At least the DPS hasn’t started euthanizing applicants waiting in line to free up examination spots.  

G. Keith Smith, M.D.

I noted in a previous blog that now that Medicare no longer pays for B 12 shots, their availability will become greater and their price will drop.  ”What about the poor,” you say.  Actually, the poor are the true beneficiaries as the price will drop to a range affordable for them.  In short, the price will become what the price should become, as sellers and buyers dance until equilibrium occurs, leaving neither surpluses or shortages, what economists call the “market clearing price.”  

I was asked earlier today in an interview about payment for dialysis and how that fit in to my “free market” medical ideas.  Dialysis is expensive.  I would argue, though, that its high price is primarily due to the presence of the mother of all third party distorters, Uncle Sam.  If dialysis were no longer covered by Medicare, what do you think would happen to its price?  Its availability?  Why should it be any different from B 12 shots?  Without government administered dialysis, the price would fall.  Charities would form to pick up the slack and would render more dialysis for far less money.  Bastiat’s dollars not wasted from the previously overpriced dialysis care could be used to purchase more dialysis, for someone who could otherwise not get it. 

Now let’s change gears.  Why wouldn’t physician services follow the same economic pattern?  They would and they do.  What would happen to physician fees in the absence of third parties?  If you said they would fall and become more available and abundant, you go to the head of the class.  Just as Medicare patients should celebrate the decision by Medicare to no longer pay for B 12 shots (prices will fall and the shots will be more available), these same patients should celebrate physician services no longer being paid for by Medicare.  Physicians who “opt out” of Medicare are a great example.  This is the only way these physicians will see patients “covered” by Medicare.  Their professional services would otherwise be unavailable to these patients.  Their fees are transparent and low after opting out.  This physician defection removes the scarcity-producing price controls and therefore improves access for the elderly.  This financial arrangement, limited to the patient and their doctor, also removes rationing influences like “best practices,” and results in care that is customized for each patient, not care that caters to a faceless Medicare bureaucrat.

Look at the prices on our website.  These prices have made surgery an affordable option for many who would never have been able to have access to this care, thanks to our friends at the “not for profit” hospitals.  These prices are contingent on the absence of a third party.  Lower prices, better access.  

The Unaffordable Care Act (UCA) institutionalizes the distortion of the government and third parties on health care costs, a situation that will drive prices through the roof and simultaneously create long waiting lines.  Higher prices, less access.  Once again, remember that this is intentional, as the crisis created by the UCA will lead to many begging for even more government “help” in the form of a bankrupting single payer system

Smart patients should be begging their doctors to get “off the grid,” to “opt out.”  Smart Medicare patients should be encouraging their doctors to do this, as this will mollify the physician’s fears of this bold move.  Smart patients should be asking their doctor to be thinking about how much they would charge if the patient paid cash.  

Many physicians have “opted out” of Medicare, thanks to the writings and advice of the Association of American Physicians and Surgeons.  As smart a move as this is for the doctors, their patients are the primary beneficiaries.  Lower price, improved access.  More and more doctors will make this move.  I think that many more would do it with the encouragement of patients who understand the basic economics of the distortions of third parties, which are nothing more than government charlatans masquerading as “protectors” of the people.

G. Keith Smith, M.D.

Several governors aren’t setting up the health exchanges mandated by the Unaffordable Care Act (UCA).  Either they see this as constructing their own gallows, or see it as an unnecessary expense if the election goes the way of the GOP.  Any honest governor knows that this is the tool that will be used to crush smaller competitors and stifle any innovation in the health insurance industry, both of these components intended to drive costs to levels never seen, levels that will bring people begging to the government on their knees for a single payer system.

My liberty-loving friend Jonathan Small at OCPA (Oklahoma Council of Public Affairs) thinks it’s time for the state government to get going and create an exchange, as Lord forbid the federal government sets one up for us.

He has a point.  But think about what he has said.  If you agree with him, then you share his fear of being subject to federal control.  But why do you fear this wonderful government that has come to our rescue and brought each of us everything we need, even free health care?  You know, they’ve done such a great job up to this point, why not just sit back and let them craft an exchange out of whatever mold they think is best for us?  Aren’t they there to help us and make our lives better, more secure?  

I don’t know the answer.  I think many don’t fear the government and are therefore, in my opinion, asleep.  The statists are counting on enough folks not waking up until it’s too late.  By then these big government types will be long gone with their loot, blaming whoever follows them of mismanagement of their ideas and policies if things aren’t going well. 

Maybe the answer is to let the feds set up all of the exchanges so people  can see first hand and soon what this bill was meant to accomplish.  Maybe the states and the governors shouldn’t soften the blow this health care law represents.  Maybe this approach will wake more up faster.  Or maybe Jonathan is right.  Who knows?

G. Keith Smith, M.D.

I anesthetized a 208 pound, eleven-year-old female recently.  Her parent’s combined weight was well over 700 pounds.  Both parents were smokers.  It occurred to me that the Unaffordable Care Act (UCA) guarantees that they will never be turned down for insurance.  What does that mean for you and me?  

If you think that including folks who engage in this level of self-abuse on your insurance plan will drive your premiums through the roof, you go to the head of the class.  If you believe that health care is a right and that these folks have a right to health care, you may think differently when their “right” to health insurance causes your premiums to skyrocket and you can no longer afford or obtain care.  What would happen to life insurance rates if skydiving and previous suicide attempts could not be considered for exclusion?

“But wait!”   “These folks are going to get care anyway and the hospitals charge us more now (because they don’t have insurance) to cover them!”  Right?  If you believe that the hospitals plan to lower their charges after implementation of the UCA, you go to the back of the class. 

Actually, community, not for profit hospitals made a deal years ago to deal with the charitable care issue.  These hospitals, having been required to care for the indigent, were relieved of any tax liability.  “Not for profit” really means “don’t pay tax.”  The value of this “tax free” condition is never discussed as this excessive number would make Donald Trump blush.  Not satisfied with this loot, the hospital lobby has successfully saddled us with the uncompensated care scam and convinced us all that “cost shifting” was necessary to avoid bankruptcy. 

What does the UCA do to address this?  Pour gas on the fire.  Anticipating the unmanageable increase in demand for the now “free” medical services, the authors of the UCA birthed the IPAB (independent payment advisory board), which puts price controls on….ready?….physicians.  In this stealthy way, physicians will become the de facto ration police of health care by avoiding patients whose care is intentionally “underpriced” by the IPAB. 

$15 payment to the physician for an evaluation of a morbidly obese, hypertensive diabetic with obstructive sleep apnea and coronary artery disease with a history of foot ulcers, is a price that will cause lines to form and doors to close.  If $15 dollars doesn’t close the doors, the IPAB will try $10.  These unfortunate patients will be armed with a worthless insurance card, one that ironically denies them access, like never before when they were uninsured.   Premiums will skyrocket to allow for inclusion of these patients who will be denied care, and more and more people will surrender to the ultimate goal of the state:  to control your health care with a  single payer system.  To control your health is to control your life.  While the current system is a government-created mess, most people I know would rather be bankrupt than dead. 

G. Keith Smith, M.D.

I told someone on a radio show the other day that I chose liberty because I want to be free.  I don’t choose liberty because it results in the best and most rational allocation of scarce resources.  This is simply a bonus. 

That’s the difference between the thought processes of the Austrian economists and those of other schools.  The Austrians say in essence that they don’t care what you do with money robbed from them.  All they care about is that they were robbed.  Any discussion distal to the robbery is superfluous. 

I like the Austrian’s approach.  This sounds very simple but is extremely powerful stuff.  When a statist is arguing about the superiority of their plan over that of another government plan, the simple answer is, “..but you have to rob me first, either way, no?” 

I have been interviewed a fair amount lately as a result of the court’s decision and due almost exclusively to the promotional efforts of my friend Dr. Jane Orient and the Association of American Physicians and Surgeons.  Prior to each interview I remind myself to keep my eye on the premise.  Discussions downstream of a rotten premise are at best a waste of time, at worst very distracting and destructive. 

Here are some of my “anchoring” thoughts/premises:

1)The consequences of the Unafforable Care Act (UCA) will be borne by patients.  Talk of how this negatively affects doctors bores me.  It may hurt physicians’ business, but that matters only in that patients will be denied, delayed and euthanized as a result.     

2)Almost anything that oozes out of Washington will line the pockets of those who wrote or promoted it. 

3)Coverage doesn’t mean care.  This is Jane Orient’s quote and I think sums things up. 

4)A single payer system is the ultimate goal of the statists and they hope to accomplish this by creating chaos in the medical economy with the UCA.  This plan is meant to fail.

5)The electronic medical record systems will serve as the KGB of medical intelligence.  Ironic that the propaganda surrounding this intrusion succeeded in getting physicians and facilities to provide the state with this information voluntarily, rather than hire goons to gather it!

6)Physicians working as employees of hospitals are key to the success of a state-run plan, as rather than work for their patients, these quasi-physicians will tow the line for their employer and the state

7)As the state becomes even more involved in medical care, people’s illnesses will represent a liability on the balance sheet.  Those with chronic illness will be targeted for neglect or extermination in order to save face for the increasingly bankrupt state health plan. 

8)Those physicians who brave this storm, stay dedicated to their patients, embrace and follow free market principles and eschew the leverage of third party payment will thrive as the distinction between the care they render and that of their employed counterparts will become even more stark as time goes by. 

G. Keith Smith, M.D.

Call a roofer and tell them your roof needs to be replaced.  “Who’s the insurance company,” they’ll ask.  Tell them there’s no insurance.  Compare that price to the one you get from another roofer who thinks insurance is involved. 

Take your car in for repair of hail damage.  “Who’s the insurance company,” they’ll ask.  Once again, tell them there is none.  Compare that price to the one you get from another body shop under the impression that insurance is involved. 

The presence of third party payment or guarantees distorts the marketplace.  The presence of third party insurance and its effect on the market is insignificant to the distortion created by Uncle Sam, however.  Guess what the presence of student loan guarantees by Uncle Sam did to tuition charged by colleges in the U.S.?  Guess what effect these guarantees had on the amount of consumer credit held by Uncle Sam?  Best of all, guess what happened to the delinquency rate when Uncle Sam took these over in 2010.  It’s all here if you’d like to see it.

So what will everyone having health “insurance” do to the cost of health care?  If you said DUH?! you go to the head of the class.  Yet that was the thrust of the Unaffordable Care Act (UCA).  Soaring costs were the point, the government’s goal.  This will give the big insurance companies their excuse for massive premium increases, creating wild profits for them.  People will scream for the government to rescue them.  Rather than accept the blame they will deserve, they will push further as part of their plan and usher in their single payer system.  The country will be carved up for the few remaining insurance wolves to devour.  They will receive their premiums and make even bigger profits from extreme rationing, unimpeded by any threat of competition.  

We will have an opportunity to discuss the costs of care.  It will be brief, however, as the push for this national plan will come close on the heels of this most recent act.  Look at what your hospital bill was if you have had surgery, then look at the prices on our site.  We are making money at these prices.  Hospitals down the street charge 10 times what we do many times yet claim to make no profit.  They want everyone to have insurance so they’ll make even more money.  Not satisfied with their untold billions in profits, the insurance companies, prime authors of the UCA, have now made it a crime to not purchase their scam.  

Libertarians often say that government has no money that it didn’t first take from you at the point of a gun.  I guess the same can be said about health insurance now.  The uninsured actually served to keep a lid on prices partly due to leaked stories of greedy hospitals bankrupting the sick.  Insurance for all will take the lid off, just as the authors of the UCA hoped. 

G. Keith Smith, M.D.

If you are paying $1000/mo in health insurance premiums now, that number will soon be much higher as a result of today’s court decision.  Premiums will increase because of the definition of “insurance” in this law.  The benefits that are mandated (breast cancer and pregnancy coverage for all, including males!) will result in these higher premiums, as none of these goodies will be free.  Mandated screening for bureaucrat approved procedures and other jewels will drive up the cost of insurance.  All of this is according to plan, as the statists know that unaffordable private insurance will necessarily usher in a single payer plan, their ultimate goal.  Once this goal has been attained, Uncle Sam will collect the money (on behalf of the 3 or 4 insurance companies that remain) and pay very little of it out, as care is denied on a widespread basis and profits of these companies go through the roof.  

Look for more and more physicians and medical facilities to post their prices.  As fewer and fewer deal with Medicare and Medicaid (due the price controls and costs and hassles of data reporting and electronic medical record keeping), this posting of prices will be less problematic and therefore more prevalent.  The low prices of care at physician-owned facilities will render the prospect of going without insurance much less scary, and will make payment of the FINE/TAX/WHATEVER? make more financial sense.  Patients who value their privacy, who don’t want every detail of their life sent electronically to Washington bureaucrats, will increasingly turn to these physicians and facilities that have shunned federal money.

Whatever you do, don’t count on the Republicans to overturn this any time soon.  Remember we got the Medicare, Part D legislation from the GOP when they were in control, the greatest gift to big pharma in history until the Unaffordable Care Act.  The insurance, pharmaceutical and big hospital lobbies will have even more profits to spread around Capitol Hill, making tough talking legislators, soft actors.  Also keep in mind that the GOP is hoping you’ll count on them to fight this rather than hold them accountable.  July 11th’s symbolic vote to repeal the Unaffordable Care Act is an attempt to prevent consequences from raining down on incumbent Republicans.  I predict that pleas for campaign contributions will be like never before the next several months.  If placed in power they probably won’t deal with this right away as removing a crisis deflates the pressure to send them more money.  

The free market will continue to work in medicine.  You will find it in the office of a physician who belongs to the Association of American Physicians and Surgeons.  You will find it in the office of a physician who has opted out of Medicare, providing care to the elderly but unwilling to deal with their government-issued insurance.  You will find it at surgery centers like ours and at physician-owned specialty hospitals, increasingly transparent with their pricing and unsurpassed in quality and patient satisfaction.  You will be able to find all of this but you will have to look a little harder after today.  Many of those who count today’s court ruling a victory will soon have a worthless insurance card in their pocket, one which certifies them as “insured,” but one which will gain them no access to a physician’s office.  They will, like the Canadians, have a right to hope for health care.  Solutions to the allocation of scarce resources never make sense or work unless they come from the unfettered and free market.  Some semblance of it will continue to operate and function, and will be responsible for the provision of the only care worth having.

G. Keith Smith, M.D.