Samuelson’s solution to Healthcare– Increase taxes

It’s fascinating to watch the health care debate develop. This today in the Post:

“We could charge the elderly more for Medicare. We could tax employer-provided health insurance as ordinary income. We could create a dedicated federal tax to cover government health costs — if health spending increased more than revenue, the tax would automatically rise. People would quickly feel the costs of our present system. Of course, that would be unpopular, because it would compel Americans to face a discomforting issue — how important is health care compared with other priorities?”

Medicynical note: Mr. Samuelson seems to think we need to increase the costs to people by increasing taxes on health care. His proposal, however, will increase those who cannot afford health care much less more expensive insurance. He believes this will decrease use of the health care system and decrease costs. A little like the “let them eat cake” solution.

Free market approaches in health care simply don’t work. Patients are not in a position to comparison shop and cannot be fully aware of cost implications and all the options. Health insurance, for example, has been a “free market” for years and failed to providing affordable comprehensive care. Insurers are more concerned with their bottom line than quality care.

As noted by the McKinsey study, health care has become unaffordable. Insurance is overpriced; cost effectiveness is not a consideration; and utilization in some areas is excessive. Overpricing, as advocated by Samuelson, increases the uninsured, the tendency to delay preventive medical services and the use of expensive inefficient emergency rooms. His solution is more of the same and does nothing to decrease inefficiency and waste in the system.


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