The White House public relations team has a problem. Where on earth did people get these ideas about government rationing health care? They ask. Why do people imagine they will lose their private health insurance coverage or doctor? After all, the President repeatedly says that will not happen. Period. Why is there such fear out there?
The White House media folks need to look no further than across the street to the Eisenhower Executive Office Building where top Presidential appointees, Peter Orzag and Cass Sunstein hang out. Both have expressed an interest in behavioral economics. Professor Sunstein is the co-author of Nudge: Improving Decisions About Health, Wealth, and Happiness, an interesting book, which emphasizes the official presentation of information in a manner that “nudges” individuals to make certain decisions.
The giant House bill is chock full of “nudges” and restrictions. Low-income individuals will not be eligible for private health insurance, they will go to Medicaid instead. To the federal government budgeteers, expanding Medicaid is always “better” because the states pay providers 20-25 percent less than private health insurance. Of course, any state Medicaid director will concede that this leads to access problems. Subsequently, 30 percent of ambulatory visits to hospital emergency rooms or outpatient departments are paid by Medicaid. Medicaid recipients also see specialists at half the rate of people with private insurance. Expanding Medicaid means increasing the number of people wholly dependent on government for their health care. That increased dependence on government, combined with a contraction of private options, appears to be the real underlying goal of “reform.”
People getting new taxpayer subsidies will be able to use them only in plans designed and approved by the federal government. While everyone talks about the impact of a government plan, no one in either Congress or the Administration have actually told us how it will work. Any health plan, including a government plan, has to establish a set of benefits and recruit its network of doctors and hospitals and other providers. Will the government plan operate like a fee-for-service plan or a giant HMO? Will tax dollars be used to fund abortions? Please don’t be evasive about intent, a simple yes or no is in order. If the law does not expressly prohibit the use of taxpayer funds for abortion, then it is allowable. The failure to provide complete information is not only a dodge, but also a kind of nudge.
Congressional leaders tiresomely insist people will have “choices”. Yes, the “choices” they give them. That is why there is in the House bill a “Health Choices Administrator”; an official to make your choices for you. The nudge works this way–you can buy a “qualified plan” regulated by the federal government or choose to forfeit the taxpayer subsidy and pay a fine instead for being uninsured. Nice nudge. The House bill reduces Medicare payments by $500 billion over ten years. It will be difficult for groups like AARP to reverse previous positions and now argue such changes will not have an impact on access to care. What will happen to the millions of seniors who have chosen and would like to keep their Medicare Advantage plans? Many will lose them, of course. They’ll feel more than a nudge.
The recent congressional townhalls show that the national health care is at least in part a proxy battle over fundamental differences in the role of government and political philosophy. Does political power and decision-making come from the top down, or does it come from the bottom up? In a free society, decisions about the most issues in life are made from the bottom-up. Give people clear, complete, and accurate information and they will make decisions based on what they see as good for them, not someone else, and will act in their own best interests, not become a pawn in the interest group battles of lobbyists and politicians. An active, engaged citizenry; that is what makes both representative democracy and free markets work. When politicians make the key decisions over the most important issues in your life and government controls the vital information that affects those decisions, you lose both.