Monday, May 11, 2009

So What Could we Lose in Health Care Savings?

The Los Angeles Times reported today that "President Obama, joined by an array of groups pledging to cut the cost of health care, said today the commitment that insurers, hospitals, doctors and others have made to saving money will help him achieve the health care reform he is pursuing on Capitol Hill."

The Washington Times has taken a rather dismissive tone to the actions, stating "The pledge provided few specifics on how the costs savings would be achieved or monitored. And many industry groups remain fiercely opposed to a central plank of the Obama health reform plan — the creation of a publicly funded health insurance plan to compete with private insurers and ensure universal health coverage."

Many will argue, including this writer, that any such pledges by the health care industry will likely be more verbal than monetary. This is all the more the case when you factor in the huge amounts of money the industry will have to spend to fight the Administration's socialized medicine program.

This government-private "collaboration" has problems on several levels:

  • Where does an administration that has spent more in 100 days than any Administration up to Ronald Reagan spent in their entire terms, have the right to lecture anyone on fiscal responsibility?

  • These dollars are being spent on something and there are always trade offs. Will the proposed $2 trillion come from cutting waste and bureaucracy? Or will it come from innovation, salaries, patient care, and other legitimate functions of health care.

  • The fundamental question of the "role of government" is again, completely ignored in this "agreement."

Right now this agreement is little more than another example of Obama attempting to do "something," even if it results in little or nothing. It is an example of rhetoric without substance. The solution to America's health care problems will be found in the market place. At some point, that is where Obama needs to seriously search. What works in our economy are things like competition, reasonable risk, innovation, and economies of scale. These are found in the market, not in the government.

Kevin Price is Host of the Price of Business, the longest running show on AM 650 (M-F at 11 am) in Houston, Texas and on AOL Radio. Eric Bolling of Fox News and Fox Business says that Price’s Blog “is very influential and moves the blogosphere.” Steve Moore of the Wall Street Journal calls Price the “best business talk show host in the country.” Find out why and visit his blog at www.BizPlusBlog.com and his show site at www.PriceofBusiness.com. You can also find Price on Strategy Room at FoxNews.com.

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