Government must promote, not reduce, ‘ownership’

Would-be health reformers in Congress are taking much of their inspiration from reform experiments conducted in the states. Unfortunately, they have seized on the worst ideas the states have to offer.

Congressional Democrats are dead set on adopting the rules from states where the hand of government is heaviest and imposing them on the entire country. If they get their way, patients will have less control over their health care decisions — that is, less “ownership” of their health. Ultimately, all Americans would suffer from the poor quality of care and skyrocketing costs.

In some states, government regulations dictate everything from what an insurance plan must cover to how doctors must organize their practices. According to Duke University economist Christopher Conover, excess regulation cost the U. S. health care system nearly $170 billion in 2002.

Just look at New York and Massachusetts, the two states with the least amount of health ownership in the country, according to the Pacific Research Institute’s 2009 U. S. Index of Health Ownership. Each year, the Bay State spends more per person on health care than any other state in the country. New York spends the third most per capita of any state.

In these states’ overregulated health sectors, competitive forces that drive down prices for consumers are stifled by government interference.

In 2006, Massachusetts began requiring all individuals to have health insurance. State leaders guaranteed that an “individual mandate” would bring down insurance premiums even as they imposed onerous rules regarding what policies had to cover. Despite their promises, the state’s health insurance costs have risen 42 percent.

Some in Congress would like to expand the Massachusetts plan nationwide and mandate that all Americans obtain coverage.

Congress is also looking to impose on all Americans the “guaranteed issue” and “community rating” policies in place in states like Massachusetts and New York. These regulations force insurers to accept all applicants and to charge them the same rate, regardless of their medical history. Such a move would cause premiums to shoot through the roof.

If Congress is eager to take lessons from the states, it should look to those whose citizens have access to affordable, high-quality health care free of costly or overbearing state intervention.

North Dakota is just such a state. Its residents have the highest level of health ownership in the nation. It’s no wonder that employer-based health insurance premiums for both individuals and families in North Dakota are among the lowest in the nation.

Congressional lawmakers seem intent on reducing Americans’ health ownership. If they’re successful, we’ll all have far less control over our health care — at far greater cost.

John R. Graham is director of Health Care Studies at the Pacific Research Institute.

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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