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March 25, 2013

Providing Affordable Service is Best Left to the Private Sector

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The debate about health care in America unfortunately obscures some important areas of agreement. But the noise also masks some fundamental differences of opinion about the role of government in health care.

Let's start with areas of agreement. Polls show clearly that most Americans believe that every lawful resident of this country should be able to count on some basic level of health care. And most accept that those of us able to assist others have an obligation to do so. But we differ on the role of government in determining the level of that obligation and in shaping the system.

If we must make sure that someone has enough resources to afford a basic level of health care, then I agree government has a financial role. But beyond assuring that the basics are affordable, I find it hard to accept that government should tell me, my doctor, and my insurer exactly what benefits should be in my health plan - and what I must pay for.

This is not just a matter of freedom and constitutional principle. Once the government requires us to have specific benefits, lobbyists will move heaven and earth to make sure their clients' services and procedures get added to the must-buy list.

According to the Council for Affordable Health Insurance, states have imposed more than 2,000 benefit mandates on insurance plans. The Affordable Care Act adds on a federal layer of mandated benefits. Not surprisingly, this drives up insurance costs, forcing a growing number of businesses to consider dropping employee coverage.

There's an alternative to government mandates. If someone receives money to help buy health care (including Medicaid or Medicare), taxpayers can reasonably insist that the money is used for real health care (not hot tubs or hair transplants) and true insurance (such as emergency-room coverage). Beyond that, the consumer - not the government - should be free to decide what package of coverage they buy.

The American health-care system is a huge, complex thing. It's preposterous to think that Congress could write one bill and suddenly manage an enterprise that constitutes fully one-sixth of the nation's economy. No wonder the administration is having such problems figuring out how to implement Obamacare. They've already had to jettison an entire important section of the legislation, dealing with long-term care, because it was totally unworkable.

Figuring out the most efficient way to provide a service, and to tailor that service or insurance plan to the needs and preferences of individuals, is something the private sector does very well and the government does really poorly.

Yes, government needs to make sure everyone can afford basic care. Americans with serious and chronic medical conditions should be able to get affordable coverage - without heavy cost to taxpayers.

And where government needs to be involved, let the states lead. Partly that's because we still don't know the best way for government to help expand coverage affordably. Moreover, what works well in Philadelphia may not be best for Anchorage. So we need to be able to try different approaches.

When it comes to health care, Americans share many common values and principles. What divides reasonable people is the proper role of government in reengineering the system.

-Stuart M. Butler is director of the Center for Policy Innovation at the Heritage Foundation.

First appeared in The Inquirer.

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