Health Care and the race for Governor

Four years ago in the Illinois race for governor candidate Rod Blagojevich was upfront in his views and posted it on his website:

Rod Blagojevich favors the goal of creating a universal health insurance system.

Four years later his campaign website boasts that he has made “health care and prescription drugs more affordable:”

  • Over 400,000 people who didn’t have coverage three years ago are now covered.
  • All Kids guarantees every child access to quality, affordable health insurance, making Illinois the first and only state to cover every child.
  • Illinois’ Leave No Senior Behind program makes prescription drugs affordable for 400,000 retirees shortchanged by President George W. Bush’s failed Medicare Part D.

As of this morning (9-12-06) Judy Baar Topinka’s redesigned campaign website didn’t have her health care plan listed yet (or at least it wasn’t easily found). We know she’s outlined plans for Medicaid reform.

What’s a shame is that four years later little has been done by Illinois political leaders to help set the context for what really ails the health care system. Little would be expected in this regard from Blagojevich and the political left – since they prefer the debate as it is. Republicans and conservatives, however, have important work to do to win public support for the right solutions.

As with four years ago, Republican political leadership could benefit from spending some time at the web site of the Galen Institute. Located in Alexandria, Virginia, Galen bills itself as “an innovative research organization focusing on health and tax policy.”

Grace-Marie Turner, the founder of the Institute, says it nicely: “As with any health care problem, it must begin with a proper diagnosis if treatment is to be effective.”

Turner states:

The United States does not have a properly functioning market for health care. Third-party payment systems dominate both public and private sector plans, giving consumers the illusion that someone else is paying for their health care consumption.

With government’s large and growing role in Health Care (e.g. Medicaid and Medicare), taxpayers are very often the “someone else” paying those bills.

Turner continues,

Lack of price sensitivity is one of the key drivers in spiraling costs. This also has given political leaders a blank check to enact a mountain of expensive, feel-good health care mandates, regulations, and price controls in various disguises.

Like most Democrats, Governor Blagojevich has merely expanded government’s, that is, the taxpayer’s role, without addressing the root of the problem. Contrary to what we constantly hear in the news, the biggest problem in health care isn’t the fault of doctors or hospitals or drug companies or insurance providers. Instead, it’s government tax policy and the resulting evolution away from the basic principle of insurance.

During the 1940s and 1950s, government tax policies began to give incentives to consumers to get their health insurance through their employers. Employers’ contributions to group health insurance plans were no longer counted as taxable income for employees.

This might be great for those who have employers purchasing group plans, but it isn’t for those who do not. Millions of Americans are self-employed or work for small and medium size businesses that don’t have access to the group plans that receive what amounts to a generous government subsidy.

Then as demand for health care increased through the years, insurance policies moved away from covering just large or catastrophic costs to becoming a pre-payment plan for routine services. A simple comparison is that if auto insurance were like health insurance, regular car maintenance would be insured and not just accidents.

The attitude among many policy makers is that health care is too important to be left to the individual. Galen believes the opposite, that it’s too important not to be left to the individual. Policy makers have legislated many counter-productive and even harmful solutions. Better ones can be found at the Galen Institute.

Grace-Marie Turner says we need to:

…inject some sanity into the system by engaging the power of consumers to force efficiencies in the health sector, as they do in other sectors of the economy, by demanding the best value for their money.

Without addressing tax policy in the health care reform debate, skyrocketing premiums and increasing taxes will continue.

To learn more, follow these links:

Galen Institute

Heritage Foundation

Heartland Institute