Don’t buy the ColoradoCare single payer snake oil – Pacific Research Institute

Don’t buy the ColoradoCare single payer snake oil

The good people of Colorado must be smoking something these days.

That’s the only explanation for the decision by 156,000 of the state’s more than 3 million registered voters to endorse a November ballot initiative that would create a statewide single-payer health care system.

Patients in single-payer systems elsewhere must withstand low-quality care and long wait times. To fund all that failure, they pay sky-high taxes. If Colorado’s voters approve this single-payer measure at the polls this fall, they’ll experience these realities firsthand.

Single-payer systems control costs by using government power to ration care.

In Canada, where I grew up, patients have to wait four-and-a-half months, on average, to receive treatment from a specialist after getting a referral from a primary-care doctor. Many who want – or need – the most cutting-edge technology and procedures come to the United States and pay out of pocket rather than suffer in line.

In Britain’s single-payer system, one in five cancer patients has to wait more than two months to start treatment. Delays even plague ambulance and emergency room services. Recently, junior doctors fed up with low pay went on strike, which may have contributed to at least one death.

Socialized medicine has failed in the United States, too. Just look at the Veterans Health Administration. Patients have died waiting for appointments. And the brilliant bureaucrats behind the VA’s new hospital in Aurora have exceeded their budget by more than 400 percent.

Vermont tried to implement a single-payer system in 2014 but eventually abandoned the effort because of concerns about cost. The proposed effort’s $4.3 billion price tag would’ve almost doubled the state budget. Vermont would’ve needed a new 11.5 percent tax on businesses and a new 9 percent income tax on residents to come up with the necessary funds. Gov. Peter Shumlin, who initially supported the plan, concluded that single-payer would’ve been “unwise and untenable.”

These aren’t aberrations. These problems are endemic to government-run health care.

The details of the ColoradoCare initiative are eerily similar to Vermont’s failed single-payer bid.

First, there’s the price tag – $25 billion, roughly the size of Colorado’s state budget.

To pay for ColoradoCare, the state would levy a new 10 percent tax on payrolls, with two-thirds of it paid by employers and one-third coming directly out of worker’s paychecks. There’d also be a new 10 percent tax on nonpayroll income – such as interest, dividends, capital gains, and some retirement income.

This massive tax hit would devastate the state economy. Colorado would immediately become the highest taxed state in the country. The cost of hiring workers would skyrocket. Companies and workers would surely bail for lower tax climes.

ColoradoCare’s supporters claim that the program will save $6 billion because people will no longer have to pay private insurance premiums. Reductions in overhead and fraud are supposed to reduce costs, too.

Of course, previous government health care programs have a less-than-stellar track record of delivering savings. Obamacare has added $270 billion in overhead costs to the health care system. Medicare blows 10 percent of its budget on improper payments. A 2015 report written by a VA official identified at least $6 billion a year in improper spending on medical care and supplies.

ColoradoCare’s architects are anticipating that the promised savings won’t materialize. That’s why they’re making it incredibly easy for the program’s Board of Trustees to hike taxes to “maintain the fiscal stability” of the program. This 21-person board – which would be unaccountable to lawmakers – would determine what procedures and medicines are available and which ones aren’t.

They’d inevitably settle on the one tried-and-true government strategy for limiting spending – stiffing health care providers. Medicaid, for instance, pays doctors such low reimbursement rates that many refuse to take on new patients covered by the program, since they may lose money on each one they see.

If Colorado slashes reimbursements, many doctors would pack their bags and leave. The pool of providers who remain would be too small to treat everyone in a timely manner.

Cue rationed care, à la Canada, Britain, and the VA.

Hopefully, Colorado voters will take a clear-eyed look at ColoradoCare before putting the state’s economy – and the quality of its health care system – in jeopardy.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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