The so-called Patient Protection and Affordable Care Act — the showpiece of democratic welfarism in the 21st century — has made history as the largest, fastest failure in the history of state-provided welfare programs.
It turns out that you can’t just pass a law that causes everyone to get all the health care he or she desires at extremely low cost. Nor can government create a market-like environment out of a nonmarket good or service and expect it to achieve efficiency, productivity, and customer satisfaction. …
In a real market, we would probably see medical care work much like veterinary care today — mercifully free of too much government involvement — for which you pay per service. Prices are clearly posted. Consumers pay the full cost of noncatastrophes. And there is healthy competition among providers who are trying to treat you best at the lowest price. Indeed, the restoration of the price system is the central requirement of any sane reform.
In a free market for health care, one can easily imagine subscription services emerging — think of Spotify, Netflix, or Amazon Prime for health services — but they would unlikely have anything to do with employment. The whole link between your job and your health care — and the third-party payment system through huge and cartelized institutions — came about because of wartime price controls. It’s completely arbitrary and massively distorting.
A purely market-based medical system in the 21st century might offer some wonderful surprises. The prices would continually fall, and perhaps be free for routine care, just as so many services on the Internet are free. Even now, even with all the absurdities and bloat and interventions, private-sector insurers operating in the nonprofit space are able to offer a form of mutual aid for a quarter of the price of the big players in the insurance market (see, for example, Samaritan Ministries). …
A government-run website is the digital-age equivalent of the failure of government to run factories and farms in the 1920s and 1930s. Under socialism, it was true that with enough force and money, even Soviets could produce trucks, grain, and bombs. But every economic decision involving physical resources and time requires trade-offs: If you do this, you are not doing that. The real question is: At what cost? Lenin made some progress in electrification even while major parts of the newly socialized Russia were experiencing famine.
Likewise, HealthCare.gov has become a costly symbol of a wider system failure.
The website can and probably will be fixed — but will the program itself achieve its aims? The ACA promised to retain existing health insurance coverage and then expand it. Upon implementation, the ACA immediately and dramatically reduced coverage by forcing many individually provided health care plans to be dropped. Otherwise, most are experiencing sticker shock.
In many cases, mandated coverage of new ailments made continued service economically unfeasible. In other cases, existing plans were suddenly outside the law. For example, the government said that plans must cover outpatient care, emergency room visits, lab tests, hospitalization, maternity, preventative services, pediatric services, prescription drugs, and much more. If a plan didn’t, it was essentially declared illegal and had to be canceled.
In other words, the companies who dropped millions from the rolls were merely complying with the law. They were obeying government diktat. That few people expected this outcome reveals the true nature of government planning. Two lessons emerge from the mess: Planners cannot account for all contingencies, and/or they must lie to get what they want.
Then came the doubling — in some cases tripling — of premiums of many individual plans because of the requirement that insurers take no account of pre-existing conditions, which is a bit like requiring that auto insurers cover drunk drivers who are training for NASCAR. …
Government can’t and won’t fix health care. Only the private sector can do that. The full solution, then, will require complete secession from every plan put out by every politician, every political party, and every national commission of experts purporting to know better than the people who make up the market order.