How to fix US health care – A libertarian solution
The purpose of this post is to give my personal experience with US and EU medicine and a solution to US health care based on this. I will give my libertarian solution first and my experiences second.
I am not some heartless libertarian idealist. Rather, the opposite. I think the libertarian solution to health care is the most compassionate as it will increase the level of care and for more people. I also think the Republican and Democratic solutions are bloated with special interests.
Let’s look at the problem and the solution in simple terms and the libertarian fix.
The US health care problem
- US medical care is not a free market. – There was a time in the US in the 1960s when we did not have a health care crisis. I remember this time. Now, about 50% of health care expenditures is government money paying and price-fixing with many intermediaries and rules. This is not a free market. Prices should be a fraction, maybe 20% of what they are today if we had free-market medicine. Also, innovation is slowed as the lawyers, insurers and health care providers are fat cats. I use to work for an insurance company in management, and I have the insiders perspective. Everyone is to blame as everyone is trying to get a slice of the pie.
- Medicine is a new type of public good – It can not be rationed based on income as there are moral issues. This point is important as we all need medical care and the poor and middle class will be left behind while the elite will have access.
The solution for US health care:
- Deregulate all aspects of medicine from pharmaceuticals to medical licensing. The cost would fall and quality would improve. Just like when contact lenses use to cost a fortune and now every teenager can afford them. If you pay 10,000 dollars a year, you would only have to pay 2,000 dollars with real free competition. This almost everyone could afford. Also, the variety of treatments would increase, including natural health practitioners. Reputation and quality would be based on results rather than accreditation. Americans would not be fooled into thinking there is a national standard. If you had a company would you rather hire a Ph.D. in accounting or a smart accountant? The same is with Doctors, book knowledge and the ability to get into school does not equate with being a good doctor. Currently, only 100,000 new doctors are allowed each year. This number leaves many capable, talented and passionate people barred from practicing medicine based on often subjective criteria. The FDA would be eliminated and replaced with private risk assessment. Having worked for a pharmaceutical company, I have witnessed that most rules and regulations are about ‘dotting the i-s and crossing the t-s’ and forms and paper. This takes resources from research and development and slows the progress of medicines and help for people in need.
- Medical care for the poor – With people making under 50,000 dollars a year have a negative income tax. They will clearly have the ability to pay if health care is cheap and they get cash. The main problem is the cost issue in the USA because of too much government. If the negative income tax is a pipe dream than tax credits, medical savings accounts and vouchers could be implemented.
When I use private medical care in Europe where I live, I pay about 12 – 15 dollars for an office visit. These are with top quality licensed doctors. This is not the copays but the payment. Medical care in the USA is ridiculous.
Why the mess and lack of reform?
The Republicans generally favor companies and the upper class and the Democrats, government and social medical solutions. The way our government works, that is watering everything down, the above libertarian plan would be hard to get past congress unless there was really a Ron Paul revolution.
Health Care legislation always results in some special interest pork compromise. However, if the libertarian health care solution was implemented we would have the best medical care coverage in the world for all. Believe me, now we do not.
Health care costs prevent me from moving back to the USA – A personal account
I live in Europe and I recently was thinking to move back to the USA. I have a small business and can run it in Europe or in the USA. It does not matter, I also trade stocks. Since I have a dual EU/ US passport I can live on either side of the pond and have.
As a former accountant, I crunched the numbers as the cost difference between my lifestyle here and in the USA. All was good. I was looking forward to moving to sunnier weather. However, when I got quotes for my family from a relatively low-cost provider on health care, after all, is said and done we will pay about 15,000 dollars a year. That is, calculating health care premiums, deductibles, co-pays, etc. That means also is based on if we use it to Max. For me, that is a lot of money. I am basically financially independent but, I am not a millionaire yet.
Health Care costs were the deal-breaker. In Europe, I get 100% medical care for free. I pay taxes and I get social medicine. It is clear. In the USA I pay taxes and get nothing.
If I want extra care in Europe, then I can go to a private clinic, but public medicine is basically the same. The quality in most ways is the same or better than the US as there are so many restrictions and fears of lawsuits in the USA.
Here doctors just work with the patient directly with cost, rather than through intermediaries. This is an important point. The intermediaries take a lot in the USA.
In Europe, if I need contact lenses you just buy them. In the USA it is a racket, you need a prescription. This is a rip-off, it is not needed. There are many such things.
The technology is exactly the same so do not believe only the US has high tech equipment and you fall off the edge of the world if you leave the USA.
I do not understand it. Why in Europe a medicine at such a high level, and can be covered by the state via taxes relatively cheaply, but in the USA health care is such a mess. My answer goes back to the point made above, special interest and it is not free-market libertarian medicine.
Why US medicine is not the best
- US medicine is a racket. – I have personal experience with doctors who overcharge whenever they can be based on my type of insurance. I even reported them but everyone basically said, this is the way it is. I had a dermatologist touch my face and he called that surgery on the billing. I had an X-ray charged five times more because they saw my work picked it up. I had a doctor tell me I had to take a drug I did not need. We do not have a free market and this is why I am for a libertarian solution.
- American medical care is focused on short-term, get the patient home on their own as fast as possible. This is to contain cost and liability. However, it really sticks. For example, someone with head trauma might need long-term cognitive therapy to learn to do basic things. It is effective and necessary. In the USA everything is so expensive that this is not practical except for the elite. A specific example is US soldiers with head trauma are sent home without coverage cognitive rehabilitation. Therapy would be about 20,000 dollars a year. They are on their own. In Europe, this would never happen. It is a disgrace.
- American doctors are not the best and brightest – In my experience, American doctors are so afraid of lawsuits they stay within very narrow boundaries of treatment. If you are really sick you do not want the ‘watch and wait for’ strategy. Experimental treatments are not worth the risk and out of the bounds of thinking. I have had many times when I knew more than the doctor. They are filled with book knowledge and facts for accreditation but do not think dynamically.
- Americans do not live that long – As compared to other rich countries we do not even come close to number 1. We are like 16th in the world. The proof is in the pudding.
If European medicine works why am I for a libertarian solution?
I am somewhat of a libertarian, but I am also honest and not going to bend the truth to fit my political ideology. The truth is social medicine does work in Europe. It works well and Europeans have a nice life. They can focus on other things than running scared about losing their job and being bankrupt by a personal disaster. Ironically, if I had to two chFiat money is creating money out of thin air and distorting the capital structure, creating business cycles, driving up debt and increasing inequality manifest by the Gini coefficient.oose a nonlibertarian health care plan, I think I would come closer to the democratic plan.
However, the best solution is the libertarian solution in the USA for drugs and treatment. In lieu of that, I would say that a very liberal two-tier system of private and public medicine. For the USA with such an independent-minded tradition of freedom, as opposed to the European idea of the greatest good, the libertarian health care reform is the best and most practical.