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I have learned to be patient over the last 8 years , attempting to restore to a public discussion common sense and sound economic reasoning , battling at every turn what is often emotionally charged rants from folks who struggle to comprehend basic math. Comments this week in response to an earlier article I had wrote for VaRight however have necessitated I take the time to walk ( slowly ) through some facts for folks who consumed lead based paint chips as children.
The possibility that the Affordable Care Act ( just love the name ) will be repealed/replaced has brought some defenders of this legislation ( shoved down our throats by a democrat vote—exclusively democrat ) to critique alternative proposals that might be more market based and ultimately allow free market competition to actually deliver a better mouse-trap for a lower cost. The example I have often used in groups I speak to is the Pizza example. If one buys a pizza almost anywhere these days, one can get an edible pizza , ranging in costs of $5—$20. Imagine for the sake of this discussion the government took over the pizza industry. You would have 1-2 choices, might get it if you were lucky by next week, and in all probability contract some sort of intestinal distress should you be bold enough to eat it when it arrives. Oh…..and by the way, the pizza now costs $40 ,command and control central planned economies at their very best. Did the U.S Postal service improve after Fed-Ex and U.P.S came into the picture………………” you betcha” ( feeling my Sarah Palin this week )
The example, cited again in my earlier responses of Lasik Eye Surgery apparently didn’t register with the folks who suffer cognitive declines from eating said paint chips, because this person never refuted or offered an explanation for why free market forces in the example cited in Lasik Eye Surgery wouldn’t work with health insurance costs in general . Lasik , if you recall wasn’t covered by any form of insurance, one had to pay the $15,000 it costs in the mid 90’s out of their own pocket, yet now can be had for around $300 per eye. Free Market based competition drove the costs down. Don’t confound these type folks with facts or logic, keep the train going with emotional ranting. As for auto insurance……perhaps young people pay higher premiums because they generate HUGE CLAIMS, particularly young males…..but again I digress.
This person has insisted that my Health Savings Account ( H.S.A ) contributions are being “ subsidized”, via the tax deduction I take for both health insurance premiums and contributions to the H.S.A . This person compares this to the “ subsidies” of the folks who participate in the health care exchanges set up ,now collapsing by the day. Belying this premise is an economic ignorance that lays bare the foundational roots of the faulty premise. Allow me if you will patient reader to explain.
Progressives start with the premise that all money is equal and BELONGS TO THE GOVERNMENT IN THE FIRST PLACE. Premiums for my health insurance and contributions for my H.S.A come from my earnings. Money/Income is property —–OR IT IS NOT. I happen to subscribe to the belief that money/income is the property of those that earn it , it is my property. The point missed by my critic is in his comparison , and his faulty premise is in concluding that the tax deduction of my health insurance premiums and or contributions to the H.S.A he cites is the same as someone receiving 70%-80% or more of their health insurance costs being paid directly in the form of an actual transfer payment———–someone else’s income being confiscated for the sole purpose of paying a cost on behalf of another’s incurred expense. Learn that a tax deduction is not the same thing as a transfer payment. You want to scrap the entire tax code…………I’m with you, but don’t confuse an apple with an orange.
As for this persons suggestion that H.S.A’s have not done anything to drive down health insurance costs he might just do some additional research. Insurance companies learned back during the early years of H.M.O’s and P.P.O’s that $3, $5 , $10 co-pays drove utilization rates through the roof. Anytime something is perceived as free…………people are prone to waste it. Back in my childhood days we would turn on an outdoor water faucet and let it run for hours and hours with no concern , because a typical water bill would run a dollar or two a month, regardless. After the managed care plans became popular in the late 80’s with these abysmally low co-pays ,Insurance companies found people running to the doctor’s office with the most silly and easily remedied at home problems because it only costs a $3–$10 co-pay. The industry fixed this very quickly ( I was there) by simply raising the co-pays , and it worked. Utilization rates fell like a stone. With H.S.A’s , I am using my own money to pay for routine care, doctor office visits is coming out of my money now, and I can self- treat a minor cut or burn or indigestion much more economically than going to the doctor’s office.
Even folks who consumed lead based paint chips should get this .