Saturday, June 04, 2005

The True Crisis

Those who claim Social Security is not the crisis of the day, but rather it is Medicaid and the overall cost of health care that deserve our full attention miss the point. The solution to both problems is the same, because the underlying problem is the same.

The socialized medicine crowd fails to consider the fact that personal choices weigh heavily on one's overall level of health. One of the fortunate 90 or so percent of Americans who has health insurance and access to good healthcare can make the individual choice to smoke, drink, overeat, have unprotected sex or ignore prenatal care. Any one of these decisions can severally limit the effectiveness of even the best healthcare.
It is tired, it is clich├ęd, but it is true: An once of prevention is worth a pound of cure.
The crisis in this country is not one of health insurance or healthcare, but of healthy living. This crisis must be addressed at a personal level if people are to make choices that prevent the need for costly medical treatment, regardless of who is paying for the care. Such a "national policy" in this vein would tread too harshly on individual rights for most Americans to stomach. It would be far better to simply allow people to decide for themselves whether a 99-cent hamburger is a good bargain when they factor in the cost of a heart attack or two.
Such economic disincentives to unhealthy choices do not exist for most Americans because the cost of healthcare is too low. I pay less than $10 a pop for prescriptions that cost the insurance company many times that. So, let’s say Joe Blow has high blood pressure and “good” health insurance that covers his Lipitor. Joe’s only disincentives to eating fast food are: to avoid a heart attack (“But,” Joe says, “I take Lipitor and Aspirin, so what do I have to worry about? Plus, I have health insurance, so I will have the best possible care if I need it”), or to stop having to pop Lipitor (“But,” Joe says, “it only costs $10, I can afford it”).
What if Joe didn’t have health insurance? “I would,” Joe says, “certainly be worse off, because I would be unhealthy or broke, or both.” But, what if no one had health insurance, at least not as we know it today?
If the price on the register was the real price of Lipitor, Joe might not be so happy to take it. He might look for cheaper ways to lower his blood pressure, like eating healthy, natural foods. He might, gasp, even find time to sit down and eat a home-cooked meal with his family. 

You get the picture. It gets rosier though, because with health insurance out of the picture, the market begins to take effect. As Joe and his middle-income friends stop taking Lipitor, Pfizer will lower the price or lose half their market.
This market incentive only applies so far, as people are willing to pay whatever it takes in cases of catastrophe; in such cases insurance takes over. This that such a radical idea?
Does your car insurance cover the cost of gas? Oil changes? Does your homeowner’s policy pay the gardener or the chimney sweep? Of course not. But somehow a perversion has taken place. Health insurance has come to function as a means to pay for routine expenses, not as a safety net in times of trouble. Modern health insurance and the social welfare state mitigate personal responsibility and that – not lack of health care or insurance or failing pension plans – is the crisis of our times. Fixing Social Security will fix Medicare by changing our expectations of the proper role of government.

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