Newsletter - July 2017

It is good to remember the words of Lord Acton:  Power corrupts and absolute power corrupts absolutely.

The current division and arguments in this country appear to be focused on specific issues.  However, a number of people think there is a different reason for the views on how things should be run. 

The difference has been described in many ways.  One way to describe the gulf is that one group wants everything to be working close to perfect and believes that only the government can bring that about.  Therefore, there must be numerous laws and regulations. Only then will all people be taken care of and society’s ills will be gone.

The other group consists of people who want to solve more of their problems without numerous roadblocks in their way.  They do not want governments planning their lives and setting up numerous hurdles to overcome in order to achieve their goals.  They are committed to individual rights and the opportunity to determine how they want to live with minimal interference.

This chasm of ideas plays out in California again and again.  The latest example is the move towards a single payer health plan.  This is seen by many as the perfect way to solve all health care issues in the state.  Everyone will have health care (even illegal immigrants) and it won’t cost that much.

Let’s take a look at everything that a single payer health care plan would involve. The plan that passed in the state Senate would guarantee health care for California’s 39 Million residents – no co-pays, deductibles or insurance premiums- as well as virtually unlimited benefits.  Patients would be able to see any specialist without a referral and receive any treatment that a provider deems medically appropriate.  This plan also included Medicare recipients.

The price tag for this plan is $400 billion according to a state financial analysis. The plan is to reallocate $225 Billion a year in Medicaid, Medicare and ObamaCare spending for single-payer assuming that the federal government will approve a federal waiver.

Various possibilities have been offered in order to pay for a single payer plan.  Individual payroll taxes would be raised 15%.  There would be a tax on a business’s gross receipts. Sales tax rates would be raised.  

One thing that hasn’t really been mentioned is the huge California bureaucracy that would be formed in order to administer a single payer program.

Many people believe that a single payer plan should be like those that exist in many other countries which supposedly have great systems.

It is necessary to remember that many of these systems have much stronger government regulations than the United States but they all include at least some form of private payment, some more than others.  These systems cover everyone at a far lower cost than the United States and they do it through aggressive regulation and price-setting.

Beyond the cost issues with single payer plans there are a number of other issues. Canada and the United Kingdom are two countries famous for their universal healthcare systems. Canadian health care costs work out to just shy of $6,000 per capita per year which is nearly all funded by taxes.  Less than half of that sum comes from income taxes with the bulk bankrolled by corporate and sales taxes.  Increases in per capita healthcare spending in Canada have kept pace with those in the United States.  The problem with the Canadian system is the long wait time for care.  Wait times are also a fact in the United Kingdom.  Patients can wait as long as eight months for cataract surgery.  Canadian doctors have pointed out that dogs are able to see specialists faster than people can see specialists.  Long wait times in the United States are rarely an issue.

When someone other than the patient makes healthcare decisions, the patient’s interests may not be first.  A patient has one goal: get treatment and get well.

The state of Vermont had been planning a single payer plan for a number of years.  However, in 2014, Governor Peter Shumlin announced that the single payer plan would be abandoned due to the cost.

An outside consultant in 2011 had predicted $590 million in savings in the first year of a single payer plan.  But to get those savings, the state government would have had to take over all the operations of commercial insurers without having any experience in managing such a system.  Ultimately, single payer would have come close to doubling Vermont’s total budget of $4.9 billion for 2015.  To collect the $4.3 billion cost would have required a payroll tax of 11.5% and a 9% tax on income.

One issue with single-payer systems that make healthcare virtually free is that “demand is almost unlimited.”  Therefore, the government has to set limits on what services will be provided.  This is how countries get to strict central planning.  Consequently, healthcare choices are not up to individual physicians, patients or free-market forces that could balance supply with demand.  The government sets the rules.  The rules are usually based on data or on political considerations such as a need to balance budgets without raising taxes.  Central planning always results in a shortage of some services and a glut of other services. 

Another major problem is that single-payer systems which are centralized systems also underpay physicians.  Planners decide payments and payments fall because there are no competitors and no choice for providers to bid up payments.

A major objection to a single-payer health care plan is the control it gives to the government. All single payer health care programs exercise control over a person’s medical state to some degree.  It may not be all encompassing (Medicare is basically a single payer health care system) or it may be so stringent in order to be cost effective that decisions over a patient’s health care is ultimately left to the bureaucracy.  We have that situation now in the case of 10 month old Charlie Gard in the United Kingdom whose parents want to bring him to the United States for treatment that could possibly help Charlie.  The decision by doctors is that Charlie is in great pain, has no chance for recovery and should be allowed to die by removing his life support system.  This may well be the case as regards the medical issues. The bureaucracy also decided that Charlie should die in the hospital and not at home with his parents.  Ultimately, this is how a socialist system works.  However, in a free system conscientious parents should be making the decision and not the government. 

Instead of clamoring onto the band wagon of single payer because we are sure it is going to solve all of our problems, we need to look at all of the possible ramifications with an unprejudiced eye. Once the government has total control of our medical life, there will be no going back.


GOP Headquarters:

1421 Guerneville Rd., Suite 110, Santa Rosa, Ca 95403


Mailing Address:

P.O. Box 3555
Santa Rosa, CA 95402


Phone: (707) 542-7066


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