Keep it Simple, Stupid

The Obama administration seems to be changing its rhetoric about the necessity of a public option, but let’s not get too excited, socialized medicine is not gonna go away until it dies on either the house or senate floor. It will however be fun watching the democrats fight this one out amongst themselves. The hard left will not want to budge on the public plan.

The important thing is that we don’t get fooled by a change in nomenclature. If the public option does go by the wayside, we will start to hear politicians talking about co-ops’. The simplest example of a co-op is a credit union, financial co-ops’ are relatively successful, being nonprofit entities extra capital is returned to the members so they tend to offer benefits to their members that regular banks might not, like lower interest rates. This could work in a similar fashion when it comes to health insurance, but it’s definitely not a magic bullet. Let’s remember that most insurance companies have profit margins in the low single digits, around 3%, credit unions also take less risk with investment capital so they can insure members against big losses, it’s not clear how that would translate in a health insurance market. Insurers also have to keep vast reserves on hand to cover claims, and the same would have to hold true for the co-op. So how much it could reduce the cost of a policy is uncertain. Most important, a co-op is not a co-op, well unless it’s a co-op. Which means a nonprofit free market enterprise owned, operated & funded by its members. A government-funded & operated co-op is the same wolf in different sheep skin. It would also be corrupted by political appointees, sort of like Fannie & Freddie, so forgive me if I’m skeptical.

But while we seem to have the ear of congress I figure this is the perfect time to pull firmly on the lobe. We need to start petitioning our newly attentive legislators to embrace simple free market reforms.

1st Cut the tie between employers and health insurance by giving individuals the tax advantages that employer have. This will energize the individual insurance market, giving people a reason to buy, making insurance portable. At the moment most people only change plans when they change jobs. Think about it, would you expect your new auto insurer to pay for an accident that happened before you were a policy holder. Making insurance portable will significantly reduce denials based on pre-existing conditions.

This will drive down cost, government advocates like to tell you how individuals don’t have the buying power, but that’s the idea, if insurance companies have to compete in a market with the pool of money is less they will adjust their prices to be competitive and being that most employers will cease to offer policies they will be forced to adapt.

2nd Bolster competition by allowing insurers to sell policies across state lines. This is really ridiculous regulation, you can buy bread in Pennsylvania, tomatoes in New Jersey, open an online bank account, but you can’t buy health insurance from a provider in New Jersey if you live in Pennsylvania. Allowing insurers to compete in an individual market across the country will also create better quality service. A real co-op can add to competition but it can’t do it alone and there would have to be more than one to choose from, just like credit unions.

3rd Abolish the community rating system and relax regulation this will allow individuals to be rewarded for good health and determine their own level of coverage.


A note on preventive care, Obama bills this as his cure all, preventive care with no out of pocket expenses and 100% coverage. This will not bring down costs, offering something for nothing only creates a bums rush on that service. Regardless of what Obama would like us to believe these services cost money and not everyone gets cancer or some other serious illness, in fact most people don’t. So the money saved on the few cases’ you catch early would be heavily negated by the amount of people who get these check ups & never get seriously ill. It also brings up the question of how you would enforce such preventive measures. Would government force citizens into doctor visits? Also, how would you know what to look for in a person who seems healthy unless you perform a multitude of tests on every visit? Again this cost money, and isn’t Obama always telling us about the bane of unnecessary tests.

Barack Obama is learning a vital lesson, one I learned in the private sector 14 years ago; a dishonest salesman is a horrible salesman, but even worse is a dishonest salesman who doesn’t know his product. In reality Obama has no product, he thought he could sell this to the American people with promises and platitudes. The only product offered by congress so far is a complex disaster for liberty which has the administration & congress stepping allover each other trying to sell it. Remember Barack if you confuse em you lose em.

Advocates of socialized medicine will say these suggestions are too simplistic, but I’ve learned over time that simple solutions usually work best to solve complex problems. Or as we say in the car business K.I.S.S, Keep it simple, stupid.


Anthony D Dolpies