Conservatives call for less health spending
A study shows bills would cost Missourians $25.9 billion.
Aug. 28, 2009
As members of Congress tour the state to answer questions about universal health coverage, at least one group is saying the solution might be to decrease government spending on health care costs rather than increasing it.
The Show-Me Institute, a conservative St. Louis-based think tank, published a study on its Web site last week, which stated health care proposals put forth by Democrats would increase costs in Missouri by about $25.9 billion, or about $4,400 for every person in the state, over the next 10 years.
Jennifer Zeigler Roland, director of publications for the Show Me-Institute, said Missouri might be paying less than some states, but the expenses come from government as much as new technology.
"It affects each state a little differently," Roland said. "There are costs greater than just the programs, like tax increases and inflation from the government paying."
Several other groups following the health care debate disagreed with the report's findings and suggestions. They say some of the savings from making the system efficient would cover the projected $1 trillion cost of pending legislation.
Ruth Ehresman, director of Health and Budgetary Policy for the Missouri Budget Project, said her group was concerned because it felt the study's figures are misleading. She said the costs are not allocated on a person-to-person basis, but some costs would be paid through cost savings or surtaxes on the wealthy.
"You can get that number by dividing the total cost by the number of Americans," Ehresman said. "But about half the costs will be covered by savings and the other is covered in a very progressive way where people who have the most are taxed fairly."
Roland said the government's involvement is what creates those extra costs covered by taxes.
"It's all the things that get in the middle that keep the patients from negotiating with the provider, like insurance mandates and government regulation," Roland said.
Law professor Philip Peters said in an e-mail decreasing government spending on health care would decrease demand and prices temporarily because fewer people would be able to afford any kind of health care. He said this would create a "survival of the economically fittest."
"They apparently aim to show that health care would be cheaper if we only lived in world of social Darwinism," Peters said. "We would pay out of pocket for our care and the haves would get medical care and the rest be damned."
The report said administration costs of a government-run health system, combined with the cost of regulation, create an economic wedge, increasing prices by encouraging more tests or the use of more expensive treatments. Roland said recognizing this wedge is key to solving the problem.
"What I think is the strength of the report is not just the numbers but why our system is broken," Roland said. "The kind of reform you need shrinks that wedge rather than expanding it."
Mike Huntington, president of Mad As Hell Doctors, a group of physicians who support universal health care, and a radiologist in Corvallis, Ore., said the government could cover costs effectively. He said the Oregon Health Plan, which prioritizes high-cost claims for which the assistance program pays.
"At least we thought about how to do the most good while using our resources most efficiently," Huntington said. "That's what we need to do as a nation."