September 26, 2007

September 26, 2007 | Commentary on Political Thought

Paging Dr. Bureaucrat

Sen. Hillary Clinton, the New York Democrat, recently unveiled her latest comprehensive health-care reform proposal. Mrs. Clinton says that this version of her proposal is different from her last one, and claims it could accomplish great things. She says, for example, that, unlike last time, she would let every person keep their own health plan, and she wouldn't force everybody into new government-organized health care arrangements. She also says that this time, her health care plan wouldn't be "government-run" and it wouldn't create a massive bureaucracy.

But it pays to read the fine print. The government would, in fact, have a great deal to say about your health care. You would be required by law to buy health insurance coverage. Many employers would be required by law to either provide coverage or pay a tax to cover health expenses. The federal government would replace states in regulating health insurance markets.

In short, federal micromanagement would be inevitable.

Washington can't simply require employers and employees to pay for health insurance under new federal rules without defining what qualifies as acceptable coverage. Clinton has already indicated that federal "experts" will decide what constitutes acceptable "preventive care." With federal officials making benefit decisions, they'll soon be determining what all of us should have in our health plan.

Pressure groups would swiftly begin lobbying to get Washington to mandate their products, ranging from chiropractic care and cosmetic surgery to Viagra and in vitro fertilization. This is happening today at the state level, and sound policy would reverse this process, not transfer it to Washington. 

Clinton aims to control costs by making sure we don't spend money on unnecessary or inappropriate care, and she calls for the creation of a "Best Practices Institute" to decide what procedures ought to be covered and reimbursed.

But "best practices" could turn into "cook-book medicine," replacing the professional medical judgment of doctors with the academic consensus of government officials. In any case, we don't need another layer of bureaucracy, with bean-counters in Washington deciding which procedures to pay for and which to refuse.

This plan doesn't mention price controls, but clearly federal officials would have to decide what constitutes "excessive profits" and marketing by insurance companies and would act to prevent such "excesses." Her specific remedy is left to our imagination. But you can bet it's not a free market.

Of course, there are serious problems with the health care system. Procedures can be expensive. Quaility is uneven. Millions of Americans lack insurance. But it's the free market -- not an even larger bureaucratic monstrosity than we have today -- that offers the best way to deal with those problems.

The best solution is to give people direct control over their health care dollars and more control over their health insurance plans.

Today's federal tax code discriminates against those who don't get health coverage through an employer. People who don't or can't get health insurance from an employer -- the vast majority of the uninsured -- must buy health insurance with no tax relief whatsoever, adding as much as 40 to 50 percent to the cost of their coverage.

We need to change the federal tax code so individuals and families aren't punished by the government for getting the health insurance they want and need, and not simply the insurance package that their employer or government officials prefer.

But the discussion can't stop with health insurance.

Our next president needs to deliver comprehensive entitlement reform, including the reform of the huge Medicare system. Otherwise, spending on entitlements will make up virtually the entire federal budget by the year 2040.

This is another big reason why Sen. Clinton's proposal is no remedy. She would create another giant new entitlement to health insurance, when we need to fix the financially troubled entitlement programs we already have.

Our country needs to let individuals make their own health care decisions. And we need political leadership that understands our long-term fiscal crisis can be solved by unleashing the power of the free market -- not by concentrating more power in the hands of Washington bureaucrats.

Ed Feulner is president of The Heritage Foundation (heritage.org).

About the Author

Edwin J. Feulner, Ph.D. Founder, Chairman of the Asian Studies Center, and Chung Ju-yung Fellow
Founder's Office