Editor’s Note: U.S. Rep. Ron Paul, M.D., (R-Texas) wants to become the ultimate physician-executive: president of the U.S. and leader of the free world. In this exclusive commentary, Paul, the only physician candidate for president, discusses how he would reform the nation’s healthcare system if elected next November.
No one disputes the diagnosis: American healthcare is in lousy shape. Fifteen percent of the gross domestic product is spent on healthcare, and yet surveys show a deep dissatisfaction with the quality and kind of care we receive, and millions go uninsured. An increasing number of people—refugees of a broken system—are being forced to travel abroad for treatments they simply cannot afford at home. An aging population coupled with insolvent Social Security and Medicare systems threaten to greatly exacerbate the crisis in coming years.
Our leaders, concerned with the state of the system, clamor for new government programs and legislative reshuffling of provisions. Despite years of toil, they have little to show for their effort—the crisis only worsens.
The problems with our healthcare system are not the result of too little government intervention, but rather too much. Contrary to the claims of many advocates of increased government healthcare regulation, rising costs and red tape do not represent market failure. Rather, they represent the failure of government policies that have destroyed the healthcare market.
What the politicians and their bureaucrats refuse to acknowledge is that the cost of routine healthcare is spiraling out of control precisely because of federal involvement. For many years, the federal government has taken an ever-expanding role in our nation’s medical care through regulatory and legislative activism. Of course, to oppose federal involvement is to be “anti-healthcare” or “anti-patient.” Never mind that routine healthcare is arguably less efficient and less accessible than in our recent past, with sick people receiving worse care at higher costs.
Bureaucrats, under authority granted to them by years of irresponsible congressional action, now dictate how medical care is to be offered, in what timetables, quantities and situations. Of course, these directives have nothing to do with the realities of medicine or even the demands of the market, but are simply political directives issued for sound-bite effectiveness. While sounding nice, these regulations increase costs by forcing the medical provider to expend greater resources to meet the regulations.
Things weren’t always this way. For decades, the U.S. healthcare system was the envy of the world. Not coincidentally, there was far less government involvement in medicine during this time. America had the finest doctors and hospitals, patients enjoyed high-quality, affordable medical care, and thousands of private charities provided health services for the poor. Doctors focused on treating patients without the red tape and threat of lawsuits that plague the profession today.
Most Americans paid cash for basic services, and had insurance only for major illnesses and accidents. This meant both doctors and patients had an incentive to keep costs down, as the patient was directly responsible for payment, rather than an HMO or government program.
The lesson is clear: When government and other third parties get involved, healthcare costs spiral and quality decreases. The answer is not a system of outright socialized medicine, but rather a system that encourages everyone—doctors, hospitals, patients and drug companies—to keep costs down. As long as “somebody else” is paying the bill, the bill will be too high. Resources once devoted to assisting patients with their needs must be diverted to meeting bureaucratic regulations. Federal regulations imposed on state governments regarding medical-care delivery, or on insurance providers, or employers, or directly on doctors and hospitals, all eventually come back to the consumer in the form of higher checkout costs.
What should we do now? We can take incremental steps to return control of healthcare dollars and decisions to the individual.
As a practicing physician for more than 30 years, I find the pervasiveness of managed care very troubling. It’s time to rethink the whole system of HMOs and managed care.
HMOs did not arise in the free market, but rather in government interference. In the 1970s, Congress passed laws that granted tax benefits to employers for providing healthcare, while disallowing similar incentives for individuals. As such, government removed the market incentive for health insurance companies to cater to the actual healthcare consumer by illogically coupling employment and health insurance.
As even greater amounts of government and corporate money have been used to pay medical bills, costs have risen artificially out of the range of most individuals. Only true competition assures that the consumer gets the best deal at the best price possible by putting pressure on the providers. This can only happen when we change the tax code to allow individual Americans to deduct all healthcare costs from their taxes as employers can.
Wherever possible, we should seize opportunities to restore individual control over health decisions. No further expansion of the power of the Food and Drug Administration can be tolerated. The FDA has served to lull consumers into a false sense of confidence in the safety and efficacy of medicines while hindering the development and dissemination of new cures and health information. I oppose the efforts of supranational regulating bodies like the U.N.’s World Food Code, the North American Free Trade Agreement and the Central American Free Trade Agreement, to trample individual liberty and national sovereignty in their efforts to limit access to various supplements and alternative treatments. So much could be accomplished by simply removing artificial barriers and costs in healthcare.
We stand at a crossroads; maintaining the status quo is not an option. We must begin the journey back to a sensible and humane market in healthcare or sink deeper into the single-payer abyss of rationing, stagnation and soaring costs.
Ron Paul
U.S. House of RepresentativesR-Texas
