Yesterday, August 4, 2009, an article by Dr. Arthur B. Laffer appeared in The Wall Street Journal featuring an alternative to ObamaCare. His health care research can be viewed at www.lafferhealthcarereport.org. He performed research for the Texas Public Policy Foundation, in Austin, Texas and recently presented some findings.
"The health-care wedge is an economic term that reflects the difference between what health-care costs the specific provider and what the patient actually pays. When health care is subsidized, no one should be surprised that people demand more of it and that that costs to produce it increase. Mr. Obama's health-care plan does nothing to address the gap between the price paid and the price received. Instead, it's like a negative tax: Costs rise and people demand more than they need."
"To pay for the subsidy that the administration and Congress propose, revenues have to come from somewhere. The Obama team has come to the conclusion that we should tax small businesses, large employers and the rich. That won't work because the health-care recipients will lose their jobs as businesses can no longer afford their employees and the wealthy flee."
That is the problem, isn't it? Thoughtful Americans know that higher taxes are on the way and certainly will be required to finance a universal health care program. The wealthy will not be particularly affected as they will do as always - simply pay out of their own pocket for services they desire. That is what happens in other countries being held up as examples - Great Britian, Canada, France. Those countries have a private option for those willing to finance their own health care.
Dr. Laffer finds through his research for Texas Public Policy Foundation that Obama's own plan, using his reform principles of "a public health-insurance option, mandated minimum coverage, mandated coverage of pre-existing conditions, and required purchase of health insurance - only increase the size of the wedge and thus health-care costs." And, with the $1 trillion increase of federal health care subsidies, some 30 million will still be uninsured.
According to the Texas Public Policy Foundation, President Obama's principles will Add $285 billion to the federal deficit by 2019; Increase national health care expenditures by an additional 8.9 percent; Raises medical price inflation 5.2 percent above what it would have been otherwise; Slow U.S. economic growth in 2019 by 4.9 percent less that doing nothing; Impose an additional $4,354 financial burden on every man, woman, and child in the U.S.; and Still leave 30 million Americans uninsured.
Sound good to you? We can do better.