Back in the days when a physician’s primary procedure was “bleeding”, the medical knowledge base was very limited. In the surgeon’s tent after a battle, they relied on whiskey as an anesthetics, and musket balls for the patient to bite down on during amputations and removal of shrapnel. These tools of the trade were readily available, and were a good way to keep costs down. At the advent of the industrial revolution, and the technological advances associated with this period led to rapid advancement in medical care and procedures. Chloroform and ether replaced whiskey and muskets balls as the preferred pre-surgery anesthetic. Although this provided an improved level of comfort for the patient, there was a certain amount of increased cost associated with it. As with any technological discoveries and inventions, life becomes easier, healthier, but the component of cost is driven upwards.
The first insurance plans came to the fore during the Civil War, and only to protect those that worked on railroads and steamships, and only in the event of an accident on the job not unlike disability insurance in today’s world.
As urban centers became more populated, families were living in more confined spaces, and an alternative was needed to care for the sick. By the 1920’s there was an advisory board to establish some standards for the practice of medicine. By the 1930’s, a non-profit know as Blue Cross and Blue Shield negotiated discounted pricing on a “fee for service” basis. This system worked quite well for decades. Strong union influence in the 1940’s and 50’s created employer paid insurance plans.
Government programs to cover health care costs began to expand during the 1950s and 1960s. Disability benefits were included in social security coverage for the first time in 1954. When the government created Medicare and Medicaid programs in 1965, private sources still paid 75 percent of all of the health care costs. By 1995, individuals and companies only paid for about half of the health care with the government responsible for the other half.
As the cost of healthcare rose dramatically in the 70’s and 80’s, “fee for service” was replaced by “managed care”. Which brings us to 2009. Speaker Pelosi proudly announced the long awaited Healthcare Reform bill, all 1,990 pages of it. At first blush, after perusing some random pages, it would appear that attorneys across the nation would be smacking their lips. Endless litigation, page by page, section by section is the likely outcome of this behemoth. The fact that nobody really knows what is in the bill, including most members of Congress is seemingly irrelevant. That the “cost” is “only” a trillion dollars or so over (10) years is only a detail. When was the last time the CBO accurately predicted anything (10) years out? I recall we were to have a balanced budget by now. The stimulus package was to have a profound and positive impact on the economy and unemployment. I digress. Oh, yeah, the U.S. Constituion was only (8) pages or so.
"I find medicine is the best of all trades because whether you do any good or not you still get your money." (Moliere: "A Physician in Spite of Himself," 1664)
The fact that there is no interstate competition for health insurance, is, on the surface a huge part of the problem. In order to make this happen, states are going to have to waive some laws and regulations already in place. Each state has their own policies and laws regulating the healthcare industry, and this makes is difficult to compete across state lines. Once we get by this barrier and allow true, free market price shopping, I believe the market can and will allow the price of doing business to come down. Once the Federal government gets more of her greedy and power hungry paws in the mix, the more difficult it will be to repair the damage; free markets have always worked when left to run their course. Over regulation and government interference only serves to stifle, and ultimately strangle whatever course the markets would direct. Once it is deemed to be “free”, Katy bar the door.
“You can't fix stupid.”- Ron White (Comedian)