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               WE CAN HAVE AFFORDABLE HEALTH CARE
           By Vincent H. Miller & Jarret B. Wollstein

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Affordable, comprehensive health care has become one of the most
important issues of our time. Health care costs are increasing far
faster than inflation and 13% of Americans have no health insurance at
all. As our economy becomes troubled, more and more Americans are
worried sick by the prospect of being without health care coverage.
Across the country Americans are debating replacing our ``free market''
system with a government-guaranteed National Health Insurance, such as
in Canada.

THE CANADIAN MODEL
The alleged superiority of Canadian national health care does not stand
up well to close scrutiny. Michael Walker of Canada's prestigious Fraser
Institute points out that the claimed administrative costs-savings in
Canada are illusory: ``The Canadian system controls costs not through
efficiency, but by rationing health care delivery.'' Long waiting lists
and chronic shortages of equipment and services have resulted in waits
of up to four years for elective surgery. Limited access to such basic
diagnostic pr ocedures as CT-scan examinations have produced waiting
lists a year long. Canadian heart patients now flock across the border
to hospitals in Detroit and Cleveland before they die waiting for bypass
surgery in Canada.

The more control government exercises over health care, the more absurd
the situation becomes. In Britain, the National Health Service has
become so bureaucratic and inefficient that it costs $60 merely to
change a light bulb in an NHS hospital. In Canada some low-level
directives even dictate the amount of suture thread that may be used in
an operation -- and the amount of oxygen allowed per patient.

THE PUSH FOR STATE MEDICINE
Despite the dismal performance of government-run medical services
throughout the world, there is now considerable lobbying in the U.S. for
a state-run national health care system. Politicians offer the utopian
promise of universal ``free'' health care with unlimited access, but
what they do not explain is how the enormous costs would be covered. A
socialized health care system would require a doubling of income taxes
or the addition of a new national 10% value-added-tax. Either
alternative would destroy man y businesses, financially devastate the
middle class, and plunge America into depression.

WHY THE HIGH COST?
Thirty years ago an uninsured American could afford to pay for a routine
operation. Today the cost of even a brief hospital stay has become
ruinously expensive. What has caused medical costs to skyrocket out of
control? There are three major factors: (1) Lack of incentives to
economize, (2) government regulations and bureaucracy, and (3) the
litigation explosion.

1. Lack of Incentive to Economize. Over 50% of Americans now receive
some government health care entitlements, such as Medicare or Medicaid;
and eighty-seven percent of Americans have their medical bills covered
by insurance companies. Since third parties pay the bills (at
state-dictated rates) there is no incentive for anyone -- from patients,
to doctors, to hospitals -- to exercise restraint in consumption of
medical resources. Because patients don't pay directly out of their own
pockets, few ever ask how much a medical procedure may cost or if there
is a less-expensive alternative. Similarly doctors and hospitals have
little incentive to comparison-shop or economize.

2. Government Interference In Health Care. Contrary to popular opinion,
we do not have a free market in medical services in the U.S., but one of
the most regulated markets in the world. The government now disburses
over 40% of health-care funds. Over 800 federal and state laws (some
hundreds of pages long) govern all health-care providers and
institutions. According to some estimates, for every man-hour of health
services provided by doctors, two hours are spent filling out government
paperwork. In the Marc h 1991 issue of Private Practice magazine,
Francis A. Davis estimated that government red tape has increased the
cost of medical care by at least 50%.

Current regulations tremendously increase the cost of health care in
America:

FDA Regulations. U.S. drug certification requirements are the most
burdensome in the world. It now takes 12 years and costs over $231
million to develop, test and certify a single new drug. The introduction
of some life-saving drugs -- which have long been used safely in Europe
-- have been delayed for years or decades. Delays on Propranolol, used
to treat angina and hypertension, resulted in at least 30,000 avoidable
American deaths during the period FDA blocked its entry.

Medical Licensing. U.S. doctors are the most regulated in the world. The
declared purpose of medical licensure is to assure quality health care.
The actual effect has been to drastically limit the number of doctors
and greatly increase the cost of health care. Medical procedures favored
by the AMA monopoly have been pushed at the expense of less costly
alternatives.  Independent practitioners -- such as midwives,
osteopaths, homeopaths and chiropractors -- have been severely harassed
and driven from hospita ls by AMA-dominated medical boards.

A particularly tragic effect of medical licensing has been the
disappearance of competent medical services from most poor communities,
particularly rural ones. When the cost of medical services rise, the
poor must do without.

3. Litigation. The proliferation of accident and malpractice lawyers who
encourage lawsuits and outlandish damage awards, are paralyzing
medicine. Many doctors now pay malpractice insurance premiums of
$100,000, $150,000, even $250,000 a year -- costs they must pass along
directly to their patients. In some medical specialties, such as
obstetrics, the danger of malpractice suits is causing a large number of
doctors to leave. Other doctors cope by running patients through
batteries of unnecessary and costly tests, just to avoid ruinous law
suits.

THE SOLUTION
What is the solution? The solution is not more government taxes, plans
and regulations. More bureaucracy will neither improve health care nor
lower costs. We need to eliminate stifling bureaucracy, increase control
over our own health care, and create new and innovative health-care
choices. Here are some alternatives:

1. Privatize Health Care. The health benefits we receive from government
are paid for by our tax dollars. Under the present system, government
decides how much of our money to spend on health care, consumes over
half of those funds on bureaucratic overhead, and then controls what
health services the remaining half of our own money may be spent on!
This system is not only coercive, but uneconomical as well.

Freedom of choice in health care can be increased for the needy by
replacing Medicaid and Medicare with health-care vouchers, and by making
all medical expenses (including medical insurance) tax-deductible.

2. Curtail Damage Awards. Outrageous malpractice awards are the major
cause of escalating medical premiums. Our laws, judges and juries must
distinguish between true negligence, which should be legally actionable,
and "acts of God" and human imperfection, which are unavoidable.

3. Deregulate Medical Research & Marketing. Burdensome government
testing and certification procedures have added enormously to the cost
of new drugs. Procedures must be streamlined, and liability should be
limited -- just so long as patients are fully informed of the risks and
benefits of drugs. Patients and their doctors -- not government
bureaucrats, should decide which drugs to use.

4. End Medical Monopolies. The American Medical Association is a
coercive monopoly which makes it difficult or impossible for alternative
providers, such as nurse-practitioners, chiropractors and nutritionists,
to market their services. Legal restrictions denying consumers their
choice of practitioners and therapies should be repealed.

5. Teach Healthy Life-Styles and Prevention. For many, disease
prevention and a healthy life-style is the best therapy. By improving
diet and fitness, and decreasing known carcinogens -- such as alcohol,
tobacco, and fat -- we can improve our health without ever-more
expensive treatment. Today the number one cause of death is
cardiovascular disease, which is largely preventable through diet and
fitness. Yet only 34 out of 100 medical schools give even a
semester-long course in nutrition.

6. Encourage and Expand Charitable Care for the Poor. When doctors are
spending 10 to 20 hours a week filling out forms and reports required by
Medicare, Medicaid, the FDA and other state and federal agencies, they
have little time left to help the poor. Eliminating medical monopolies
and reducing unnecessary government regulations would greatly increase
the number of health-care providers. Case loads and costs would
decrease, and the quality and variety of services would increase.
Enormous health care reso urces would become available to help the poor.

A WARNING
If you want to know how National Health Insurance might work in America,
we have a model. For over 60 years the Veterans Administration has
handled the health needs of millions of disabled and discharged
servicemen. Investigations of the VA have found abominable conditions --
bordering on cruelty: long waiting lists for surgery, filthy hospitals,
severe shortages of staff and drugs, antiquated equipment, artificial
limbs denied amputees, and indifferent and hostile administrators. In
short, you find a syste m very much like that of the Soviet Union. In
looking at the Veterans Administration medical services, you are seeing
the future of health care in America -- if National Health Insurance
were to be enacted.

As one U.S. Health & Human Services official put it, the country does
not need a medical delivery system ``with the compassion of the IRS, the
efficiency of the post office, at Pentagon pricing.''


                      RECOMMENDED READING

Why We Spend Too Much on Health Care
(Joseph Bast - Heartland Institute) .......................... $8.95

Health Care in America: The Political Economy of
Hospitals and Health Insurance (Frech III) .................. $14.95


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