McCain, Free Markets and Health Care

When dissecting John McCain’s anemic health care “plan,” invariably you find that there are some other topics you’ve missed. But this Boston Herald piece – written in support of his plan – actually does a great job of wrapping up some of the absurdities in a couple of opening paragraphs:

His health-care plan also makes most sense –

The key salvo is aimed at the central pillar of our health care system – tax-subsidized employer-provided health care. About 70 percent of Americans get their health care where they work.

The McCain plan offers a $5,000 tax credit to families and $2,500 to individuals to purchase health care on their own. This would end the inherent inequity of some getting tax-free health care from their employers, but others having to purchase it with after-tax dollars.

Generally, when you fire a “salvo” at a “central pillar,” of a system, your aim is not to improve said system. And indeed, this plan does not improve the situation one bit. But remarkably Freudian semantics aside, let’s deal with the plan. And while we’re focusing on John McCain’s plan, let’s set aside the zero-sum game of trading “subsidies” for “tax credits,” which are effectively the same thing. Let’s also ignore the fact that $5000 isn’t going to get you the same level of health care you had under your employer’s plan, even if you work at Sutherland.

Rather, I’d like to discuss the obvious misapprehension many Conservatives seem to have about the health insurance industry and the “free market.”

In a Utopian “free market” system, I get a paycheck every week which I then use to buy goods and services at will. I go to my local store and negotiate directly with the owner of the quaint little shop, Mr. Walmart, to get the best deal. No government has any role in the transaction, it’s just mano-a-mano consumer spending, and then we all go down to the fishin’ hole, whistling a happy tune, and catch us a mess of catfish.

However in the current system – and indeed the system John McCain would like to perpetuate – we don’t deal directly with the shopkeeper, the doctor and the hospital, at all. We buy a service from an insurance company and then expect that service to do it’s job when the time is right.

It probably goes without saying that this website is not the most outspoken champion of free market economics in Rochester, but any fool can see that the insurance industry mutates the supposed free market transaction at least as much as any government. There is an expectation of service on the consumer’s part – as the article points out quite correctly, without asking how much it costs – which compels insurance companies to spend without restriction on some things. Hence there is no particular free market control over the price of medicine, medical equipment or services at a hospital. Meanwhile, to control cost and maximize profit, insurance companies have begun saying “no” to many procedures and knocking people off the roles.

Basically, you’ve got giant pharmaceutical companies fed unlimited resources by giant health insurance companies and somewhere in the middle of all that, barely factored into the decision making, are you and your doctor. But the Conservatives want you to believe that you and your doctor are the most important people in the equation.

I know I’ll get a lot of heat from Conservative circles, but if you don’t plan to outlaw health insurance outright, I’ll take programs led by a democratically elected government over those created to maximize profits of everybody in the world but me any day of the week.

By Tommy Belknap

Owner, developer, editor of DragonFlyEye.Net, Tom Belknap is also a freelance journalist for The 585 lifestyle magazine. He lives in the Rochester area with his wife and son.