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February 22, 2008 5:15 PM

Health Care: the Billion-Dollar Dreams

Posted by Bruce Ramsey

Here is the first bill I’ve seen in Olympia with a projected cost in excess of $100 billion over the next decade. It is Senate Bill 6221, whose prime sponsor is Sen. Karen Keiser, D-Des Moines. Also sponsored by Sen. Jeanne Kohl-Welles, D-Seattle. It is a “universal coverage” medical care bill, called a bill to “establish a Washington Health Partnership.”

The Office of Financial Management, following I-960, has put out the following “projection of increased cost to taxpayers and affected ratepayers.” The estimate is zero for fiscal 2008 and 2009 because the program wouldn't start until 2010. By my back-of-the-envelope calculations, this program would more than double the state near-general-fund budget:

Year Individual and Employer Assessments for Washington Health Partnership
FY 2008 -
FY 2009 -
FY 2010 $ 7,197,000,000
FY 2011 $ 18,274,000,000
FY 2012 $ 18,731,000,000
FY 2013 $ 19,198,000,000
FY 2014 $ 19,677,950,000
FY 2015 $ 20,169,898,750
FY 2016 $ 20,674,146,219
FY 2017 $ 21,190,999,874
Total $ 145,112,994,843

Whether these numbers are right I have no idea. They are not comforting.

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Posted by IndividualRights

3:02 AM, Feb 23, 2008

This is a coy approach which won't get you anywhere. One has only to look at ANY example of socialised health care already in practise, to know that costs will inevitably explode and rationing will follow. Just look at Mitt Romney's disaster in MA as a recent example, or Britain's latest NHS debacle as mentioned in the New York Times.

But that won't faze the proponents of "universal health care": Their morality simply demands that healthcare be "more equal than good," and that some people should be sacrificed for the sake of others. THAT is what needs to be countered, first and foremost.

In contrast we should proudly uphold each individual's right to life and liberty as morally proper. I.e. everyone has the right to use their own money to control their own healthcare decisions, unmolested by government "mandates" or taxation.

This could be accomplished by phasing out government controls and allowing a truly free market in healthcare to develop. That this would lead to widely affordable, quality healthcare has never been in serious dispute, save for the skewed morality of the opposition.

Posted by Bruce Ramsey

4:20 AM, Feb 23, 2008

I agree with you that the the idea of a right to health care should be challenged. But that "costs will inevitably explode and rationing will follow" is not obvious to a lot of people. I keep getting the argument that universal coverage will save money because it will end the paperwork on what procedures are covered and what are not; that it and will end the inefficiency of people who shouldn't be in hospital emergency rooms going there and sticking the hospitals with the bill; that it will usher in a progressive world of preventive care, which saves money in the long run, etc. Each of these argument has a grain of truth to it, but they don't add up to the conclusion that their advocates want. The fact is, making medical care seem free, or almost free, is expensive. And when the numbers come out that universal coverage costs a mountain of money, people need to know that.

I think it's important to address that assumption that people have a right to health care, and do it in such a way that you can get to a world in which people don't have a right to it but that still almost everyone is able to get it--just as we may not have a right to be fed, and occasionally people miss a meal but nobody starves. People aren't going to accept a society in which there is no way for certain people to get treatment, but they might accept one in which the average person has to work to get treatment, and that being successful in life, and making providential arrangements, may earn you better treatment than being improvident and unsuccessful.

Posted by J. Michael Rona

8:18 AM, Feb 23, 2008

Some thoughts:
1) If these projected health care costs are correct, they will never be approved. This is an unaffordable plan. 2) It is a sad situation that the issue of right to health care is still debated. If one cannot on ethical grounds support it, then at least they should on economic ones. The cost of uninsured or underinsured is a huge cost to society. 3) While there are many who have concerns about some sort of universal coverage, the idea that such a plan could be administratively less expensive has been documented. The current private insurance market’s administrative costs could be half as much, returning billions of dollars back to customers and employers. 4) If employers would purchase more critically, the costs of health care would drop dramatically. There are huge variations in quality and cost in the health care delivery system, yet they pay the best and the worst, the same. 5) The health care delivery system is twice as expensive as it needs to be. This is because it is full of waste and defects. This is widely known and documented, but health care generally does not have the leadership vision nor the management systems to attack this. 6) There are systems in this country like Park Nicollet Health Care in Minneapolis, Signature Hospital Corporation in Houston and our own Virginia Mason who are using time tested management philosophies and methods used in other industries (like Toyota, Boeing, Paccar, Genie and many more) and creating better quality products at a lower cost, with higher customer satisfaction and greater worker satisfaction. 7) The quality and cost of health care and the access issue is not a problem to be solved with more money, in fact the opposite. The problem will be solved when the leadership in health care and the purchasers of health care say, enough is enough.

Posted by Bruce Ramsey

3:19 PM, Feb 23, 2008

A note to readers: the author of the previous post was president of Virginia Mason Health Center in Seattle, and is now a consultant at www.ronaconsulting.com.

Posted by John Barnes

11:49 PM, Feb 23, 2008

Here's some analysis of Sen. Keiser's bill from the Washington Policy Center:

http://www.washingtonpolicy.org/HealthCare/LegMemo2008HealthPartnership.html

Posted by IndividualRights

3:53 AM, Feb 24, 2008

Mr. Rona,

> If these projected health care costs are
> correct, they will never be approved. This is
> an unaffordable plan.

When has that ever stopped anyone? As a health care expert you should know better. As I already pointed out, every single example of socialized healthcare in practice has led to exploding costs and rationing.

But still we hear the incessant drumbeat for more of the same, from the two Democratic presidential candidates on down to advocates in our own state and other states as well.

The reason people refuse to heed past experience is that they want to feel virtuous, and will place their skewed sense of morality over practicality every time. They’ve been needlessly guilted into supporting altruist measures anytime somebody cries “but what about the poor??” (the fact that such measures are detrimental to the poor too is of secondary importance).

Don’t believe me? Then why are people sacrificing their own health (everyone agrees that the current semi-socialized healthcare setup is a disaster); not to mention their children’s education (lousy tax-supported public schools); or their retirement (Social Security is a Ponzi scheme; whereas your average middle-class person could retire a millionaire if they were allowed to put their own money in IRAs rather than being siphoned of by Social Security).

Why is that? It’s because they have a screwed-up sense of morality, instead of being rationally selfish.

> 2) It is a sad situation that the issue of
> right to health care is still debated.

Healthcare is most certainly NOT a right. Healthcare doesn’t exist gratuitously; it has to be produced and earned just like food, water, or anything else. Everytime you regulate or expropriate it--Medicare, Medicaid, the whole panoply of government regulatory agencies--that’s just simple theft, a violation of the individual rights of taxpayers and doctors.

The consequence of such immorality is the uniform disaster called socialized medicine. The immoral is the impractical. I.e. if your morality is at odds with practicality, you’d better check your moral premises and see what’s wrong.

> If one cannot on ethical grounds support it,
> then at least they should on economic ones. The
> cost of uninsured or underinsured is a huge
> cost to society.

“Society,” brother? Who taught you to think that way? I don’t accept any such costs. Voluntary charity is one thing, but I reject the whole notion of collective, unchosen obligations as immoral.

BTW before Medicare and all the rest, healthcare used to be widely affordable out-of-pocket. So much for economic grounds.

> 3) While there are many who have concerns about some sort of universal coverage, the idea
> that such a plan could be administratively less expensive has been documented. […]

Like Medicare, which financial shortfall is five times worse than that of Social Security? We’re talking about the “efficiency” of government bureaucrats here, right?

> 4) If employers would purchase more critically, > the costs of health care would drop
> dramatically.

Why not get employers out of the picture entirely, by giving individuals the same tax break for healthcare plans that employers get? That way individuals take responsibility for their own healthcare, and have incentives to shop around. That’s what will lead to elimination of waste and inefficiency.

For more details on the moral, practical solution to our healthcare problems, see:

http://www.westandfirm.org/index.html

Posted by J Bolton

3:22 AM, Feb 25, 2008

Health care needs to be like medicare - everyone in and everyone covered. Keeping insurance companies out will free up money for services.

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