More prescient words were never spoken by a politician than Barack Obama’s to the American people Wednesday evening on the issue of health care reform: "I am not the first President to take up this cause, but I am determined to be the last." For 60 years, Democrats have been trying to force a government health care system on a deeply skeptical American public, without success. And if President Obama fails this time, it’s unlikely we’ll see another attempt anytime soon. But despite the president’s recriminations, he has only himself to blame.
The president could have used his primetime public address to search for a moderate compromise. Instead, he chose to call those who disagree with him liars and to warn that if Congress fails to pass his plan "more (people) will die as a result." And to make matters worse, he claimed he could expand coverage to 30 million people who don’t have it now, pay for higher drug coverage for seniors, guarantee that no one be denied health coverage for any reason or have their lifetime benefits capped — all without adding "one dime to our deficits — either now or in the future. Period."
The president admitted the program he’s proposing will cost $900 billion (down from over a trillion for his original proposal) over 10 years. So how will he pay for it without increasing the deficit? For starters, he claims he can pay for expanded health care benefits for the elderly by eliminating waste, fraud, and abuse — but if it were that simple, why do we need major new legislation? Why not just sic the Justice Department or the inspector general at Health and Human Services on Medicare providers who are cheating the government now?
And what about the other costs in his plan? Who will pay for guaranteed mammograms, routine physicals, and colonoscopies that he says insurance companies will now have to offer "with no extra charge"? Does he expect doctors or medical technicians to work for free or medical equipment companies to donate their machines? Apparently he believes it will all come from savings from the excessive profits insurance companies take under the current system. But, according to the Wall Street research and ratings firm Morningstar, for-profit health care companies had an average 3.4 percent profit margin over the last year — ranking 87th out of 215 industries.
The president claims he has "no interest in putting insurance companies out of business," but that is exactly what will happen if the government forces them to expand the services they cover while simultaneously preventing them from charging higher fees, especially if the expanded pool of beneficiaries includes many of the least healthy individuals.
But maybe President Obama thinks insurance companies will survive simply because he’ll force a whole new group of Americans to become customers. The president now says he’ll require all Americans to carry health insurance — something he said he was opposed to during the presidential campaign. He implicitly admits that many people who don’t have insurance at the present time could afford to buy it if they chose; but for those who can’t afford it, he still insists on a "public option." But despite the president’s assurances that "the public insurance option would have to be self-sufficient and rely on the premiums it collects," there is no way those premiums could pay for the level of care he is insisting be provided.
He claims that "by avoiding some of the overhead that gets eaten up at private companies by profits, excessive administrative costs and executive salaries, it could provide a good deal for consumers." Putting aside the president’s apparent misunderstanding of the concepts of overhead and profit (the latter is what’s left over after deducting all expenses, including overhead and salaries, from revenues), what government subsidized or quasi-government-run agency has managed to keep costs down while providing improved services? The U.S. Postal Service? Amtrak?
The president is beginning to sound like one of those late-night TV ad pitchmen. But no matter how many times he tries to repackage his product or promises the whole thing comes free, Americans aren’t buying what he has to sell.