Why is our current health care system completely unable to control costs? For the same reason most Americans over-eat at buffets: when you don’t have to pay for each plate of food, you usually eat more. In recent decades, the percentage of health care spending paid “out of pocket” by patients has fallen substantially from 52 percent in 1965 to 15 percent in 2005. Instead of patients paying for the care they receive, our current system is built around a third-party payment system where the government and insurance companies are the ones who actually pay for individual medical expenses. When prices are determined through administrative procedures rather than market processes, both patients and producers are anesthetized from normal market incentives to reduce prices and spending.
Every major pillar of Obamacare makes the third-party-payer problem worse: mandates that limit out-of-pocket spending by patients, mandates that extend the minimum benefits insurance must cover, a massive expansion of Medicaid, and lower limits on tax deductibility of out-of-pocket spending. The one measure that the left once pointed to as its key cost-reducing measure – the taxing of expensive health insurance plans – has been gutted and pushed back until 2018.
Dear reader, research this for yourself. Don’t take my word for it, nor should you let the mainstream media be your primary source for the facts on health care reform Obama style. If passed, Obamacare will be a disaster for America. By the way, House Majority Leader Steny Hoyer (D-Md.) said last week Democrats will insist on raising taxes to achieve deficit reduction. How’s that hope and change working out for you?