You wrote,

“the private companies don’t force artificial annual payout limits (!) on the doctors (who are not allowed to refuse patients, but will have to pay the difference out of their own pocket – ha! greedy doctors, they deserve it!”

If I correctly understand your comment, you are describing a variation on our Canadian claw-back system. If a doctor here, in Canada, sees ‘too many’ patients such that s/he exceeds the maximum legally permissible earnings, then any ‘excess’ earnings are “clawed” out of that doctor’s next year’s earnings, by the Province. Since the Province pays for any ‘excess’ work a doctor may do, however charitably it may seem, then by the claw-backed earnings are subsequently used to pay for another doctor’s ‘legal’ efforts. Thus the former doctor works for free, whilst still maintaining the ideal of Provincial patient health, whilst another, doctor earns the wealth. The Province looks better, whilst the former caring and productive doctor goes, forcibly, unrewarded.

As your remark makes clear, doctors, facing patients who suck the system end up footing the cost, through some variation of the Canadian “claw-back system”:

“a friend of mine, a GP, curses these people – they drive him over the annual payout limit, since he’s not allowed to refuse them, and they often are not very cooperative

For those concerned about the finer point (Paulhus) as to whether this is socialism or not, you are right. It is not socialism, it is fascism. Fascism is no improvement whatsoever. Both are Statism Both are an affront to Individual Rights.

Wow, ah! Kai, speaking for German Socialist health care then says,

Though I *do* think that tax-funded *emergency* health care may be a good thing to vote for, anything more seems to bring about a lot of problems that really outweigh the benefits, even though I know that private insurance companies are not made up of Good Samaritans, but are in fact profit-oriented and may need a minimum level of oversight (so as not to start harassing their potential customers with DNA checks).

Can no-one look back to what took place before government based medicine?

There were still ambulances. The ambulances were still fast, and they were covered by private health insurance. They took patients to hospital. Though the EMS staff may not have been as well equipped with the latest medical approaches of today (but back then, those techniques were not known!!@!), patients got the best available. The roadway laws even gave the EMS vehicles precedence over other vehicles, just as much as the laws do today. Nobody wanted a patient to die. They really didn’t. Suggesting that they did not care. is one of those recent “truther” / “conspiracy” theories, that argue that such people care nothing for human life and really only want the few dollars-an-hour that their employment provides.

That is such utter nonsense that, if anyone deserved such a culture, it is the truther/conspiracists themselves. No-one thought that way, at the time. They just did not. I was there. I lived through it. To suggest they did, is extra-ordinarily vicious, not to mention stupid.

I came aross this discussion by chance. Let me explain a government-directed health insurance system as I know it first hand, in Germany:

Currently, we have a funny situation: below a certain income level, the non-private (government-approved) health insurance providers get 15.5% out of your gross income (!). Once you are beyond that income ceiling, you are suddenly entitled to choose a private insurance company.

They, too, are regulated (no DNA checks up front – ok, reasonable). What’s funny: They are cheaper than the *average* of the 15.5% take, yet they pay out *much more* to the doctors and pay for more treatments (the socialized medicine is limited to “useful” treatments as deemed so by the bureaucracy – with the effect that every now and then someone is being told that his expensive new cancer treatment in a US clinic won’t be paid for – where the private companies do actually pay).

The price of medical services is actually regulated, too: in a legally binding price catalog. There’s one difference, however: Whereas the socialized medicine providers are using their bargaining power to keep prices *below* this catalog (which is quite contrary to the idea of it, but there are of course exemptions by the government), sometimes to 20% of the nominal price, the private companies often pay 2-3x the issued price. So in effect, private insurance customers finance the whole system. And of course, contrary to the socialized providers, the private companies don’t force articial annual payout limits (!) on the doctors (who are not allowed to refuse patients, but will have to pay the difference out of their own pocket – ha! greedy doctors, they deserve it!).

The effect is: when I (mandatory socialized medicine client) need an appointment with a doctor, I will get one, of course. When my girlfriend (privately insured, because she’s a student and her parents are government-paid teachers, who are entitled to private insurance even below the income limit – nice fringe benefits) goes to the same doctor, she will likely be squeezed in immediately, or get an appointment much sooner. Plus, sometimes she’ll have a wider choice of treatments *I* won’t even be offered unless I specifically ask for them and pay them out of my own pocket. Remember, there’s a bureaucracy of experts judging the usefulness of certain treatments.

Of course, if you’re a social welfare “customer”, there’s also a moral hazard problem: while the private insurance company *will* start asking questions after you’ve consulted the umpteenth doctor with your little headache (and you’ll have to pay the bills out of your own pocket before the insurance company will reimburse you), the welfare clients have no such oversight to fear (a friend of mine, a GP, curses these people – they drive him over the annual payout limit, since he’s not allowed to refuse them, and they often are not very cooperative – some treatments require you to take your medicine on time (or at all), or follow a diet).

So, having the “combined” system is basically an eye-opener for the inefficiencies of government-regulated healthcare. Though I *do* think that tax-funded *emergency* health care may be a good thing to vote for, anything more seems to bring about a lot of problems that really outweigh the benefits, even though I know that private insurance companies are not made up of Good Samaritans, but are in fact profit-oriented and may need a minimum level of oversight (so as not to start harassing their potential customers with DNA checks).

Are you aware of the claw-backs doctors face if they see “too many” patients? The doctor that offers too much care to too many patients over the course of a fiscal year, will have made too much money from ‘the system’, according to the government.

The government, in the subsequent fiscal year, with-holds payments for that doctor, until the ‘overpayment’ of the previous year has been recovered. In this respect, the hard working doctor is discouraged from working hard, much the same as a union worker who works harder/smarter than his peers is disliked, and is encouraged to back off.

(See Canadian Jack London: “What is a scab? Simply, a person who purports to do the same amount of work as another person, but for less money. According to Jack London, anyone who undercuts another person, as far as wages or compensation for labor, may be considered a “scab”.)

Collectivized medicine is horrendously immoral, and accomplishes only the opposite of its altruistic intent.

To support “socialized” medicine is like sawing off a tree limb, on the trunk side of where you are sitting: After the sawing is done, cartoon like, there is a pause as you look at the camera in alarm, a whistling fall ensues, with the crash & tweeting stars at the bottom. Trouble is the aforementioned “pause” is too long for the average voter to grasp the cause of their fall!

You really don’t know? In Canada, the bureaucrat stands between doctor and patient. Not LITERALLY. It’s all done in policy known as Prior Authorization. The doctor can only provide care that he has been authorized to provide under policy. The doctor can’t just go on a hunch, or even use his best judgment… if it’s not something that is established ahead of time as permitted, then it’s a no-go.

And what’s the more intolerable, as Embedded I’s newer post illustrates: the patient and doctor cannot legally agree, under Canadian law, to dispense with the government subsidy and just proceed on a cash-and-carry basis. They are literally not allowed to do this simplest of transactions! It is illegal! At least in the USA, when something is not prior authorized (whether for a patient on government subsidy such as Medicaid or on private insurance) the doctor and patient still have the legal option to proceed on a cash basis. I find it troubling that you misunderstand the landscape for this so completely.

I notice you fail to answer my cost distortion points. That is, of course, because they are irrefutable, being based in fact as they are. What you think are fearful rantings are in fact principled arguments illustrating why what you are pushing doesn’t work and won’t ever work, and why the real solution is in an absolutely free, unregulated market.

Your inability to think in terms of principles is why you don’t see (or hear).

Sounds a lot like our system in Canada. Low overhead, run much like a private business, doctors dealing directly with patients, no need for a complicated insurance process and all the admin that comes with it. The only difference is who pays the doctor. Our administrative costs re: healthcare in Canada are far lower than yours in the US. So we agree that the current US health insurance industry is bloated and wasteful. It’s also not competitive. The question is how to fix it. I don’t think a free market can fix it, and fearful rantings about socialism and altruism aside, I haven’t heard any solutions offered here.

What both of these complaints by Paulhus rely upon is that his opponents assume that the “free” portions of today’s partially-free, partially-controlled economy operate completely unaffected by the controlled portions.

He cites the tendency by drug companies in the US to push drugs as a short-term fix (both medically for their patients, and financially for them) rather than their willingness to cure the more fundamental medical issue. It’s certainly true, but why is it true? Paulhus would have you believe that it’s inherent in the nature of capitalism. By disallowing any discussion that cites “non-current” examples, he wants to limit the discussion of “capitalism” to emcompass only whatever is done today. “Capitalism”, to him, means whatever the government hasn’t gotten around to directly regulating yet.

He is completely oblivious to the notion that maybe, just maybe, the reason why drug companies have to push pills instead of look for real solutions is because they’re scared to death that should they forego short-term profits and instead invest in long-term research, a month or a year from now the government might change the regulatory structure and all of what they’ve invested will be rendered worthless.

Psychiatry is headed this way. Google “psychiatrists abandoning insurance” for more on that. My uncle is a physician practicing psychiatry. He just takes cash now. $80 per hour. His practice is thriving like never before, and he has a waiting list as long as my arm, and very, very small staff overhead because of no need to process claims. Importantly, this anecdata is consistent with the industry-wide trend.

Without price distortion in the market, a preventative visit to the doctor really COULD cost $10-20. At that point, anyone who can’t afford it will have little sympathy from anyone else, and even a pragmatist like you should see how counterintuitive it would be to continue to let them free-ride off the backs of everyone else.

Wow. It’s like being called stupid by a stupid person. You can only laugh.

This is where your argument breaks down, you can’t define the line, there are always edge cases, it’s very difficult to define and also manage retaliatory force.

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Highways and the provision of (clean) water plainly by the state, clearly cross “the line” that protects individuals from their government… and badly so! Both would be cheaper and more sensible if privately controlled, as private corporations learn what approaches are most cost efficient and competitive.
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This is only partly true. What you’re missing is that a private system directs energies to those infrastructure projects that are profitable in the shorter term.

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Look up the history of LASIK if you don’t believe me.
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This further illustrates my point. LASIK is a great example of a procedure that had great profit potential and was therefore developed and marketed aggressively. It’s the same reason you have so many drug ads on TV in the US. Medical technology that has profit potential is developed, and those technologies that do not are developed at a slower pace, if at all. It’s a subtle difference in how effort is focused, but it’s an important one.

I agree with you that generally private enterprise will do a better job, and profit motive is a very good thing. But, there are many areas where profit motive focuses effort in the wrong direction and also leads to short term thinking.

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When I was young, my father paid, monthly, what today would be viewed as a piffling portion of his income to privately insure our entire family for health care.
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When you have to reach back a few decades or to 1791 that’s a clear indication that your argument is weak. Let’s stay current shall we, deal in the present, or at least the very recent past?

My point is still true. Insurance companies make money by paying out less than they take in. If you have a major illness, accident, etc, you don’t pay for all of it. Others paying the insurance company pay for you. You’re a freeloader. You can spin that any way you want, but the fact remains that you need a shared system where enough people get involved, or the system won’t work. What you’re really arguing about is how best to implement and manage the system. You think a free market system will work. I think the data says otherwise.

I also think you’re confusing ‘government’ with ‘any large group of humans’. It’s not government that is inherently bad, it’s any large group or perhaps we should say any large system consisting of humans begins to have problems. As it has been said, democracy is the worst form of government, except for all the others.

You do know that government-subsidized healthcare grossly distorts pricing, right? That the least-regulated sectors of health care are also the ones that behave the most normally with regard to capitalistic forces? Look up the history of LASIK if you don’t believe me.

Nowhere have I said I am Ok with other economic systems being socialized. The issue is, “What is the role of government?”

The fundamentals required to answer that question lie within ethics. To greatly simplify, are men more moral, the more they harm their lives by giviing their empathy, wealth and effort to others, or are they more moral if they understand others, keep their wealth and effort for themselves in pursuit of their own goals of further wealth &/or happiness (which may include sensible charity)? That is, which is the proper ethics for a Man: altruism OR egoism (not “egotism”).

An altruist ethics applied to politics places every individual as subordinate to all the rest… expecting him to carry both his own weight and the weight of others. That is, he is expected to sacrifice some portion of his life to those others. The contradiction in this should be immediately apparent… somewhere, someone is collecting. To collect, all one has to do is appear to have a greater need. The more self-reliant, independent & productive one is, the more they must sacrifice. To collect, one only has to appear dependent and sadly unproductive. Of course, truly productive & independent individuals will, at some point, on some issue, be extremely unwilling to sacrifice their hopes for greater productivity or happiness (gold faucets would be nice) for the sake of the unproductive, and will then balk. Now the statist power-mongers have their chance: pass a law, throw them in jail, “look how these egotistical swine neither share not support our Great Society“. So a free society becomes a mixed socialist society, and power hungry dictators take control. The 20th Century is fraught with examples, and the death toll of some 130 million killed by their own governments, is more than enough evidence of how wicked the entire notion is. Still the madness continues: Kim Il Jong, Hugo Chavez, Raul Castro et al.

Theocracies are little different, the dictators merely wear religious garb and speak of wondrous supernatural beings with whom only they have knowledge. Theocracies have a venerable history that goes back perhaps a dozen millennia.

The American Declaration and Constitution is the first historical exception. It was specifically designed to allow every citizen to live his life as he so chose, so long as he did not impose his wishes, coercively, on others. America was the first nation built on the principle that no man should be subject to a dictator, a theocrat (separation of church and state), to arbitrary laws, or an arbitrary judiciary. It was the first nation recognizing, however implicitly, that men should be free from other men, that egoism is the proper ethical basis for government. Economically, this means Capitalism is the only moral system. It means the complete separation of, not only church & state, but also of the economy & the state.

Next Paulhus asks me where a line should be drawn between government and citizens.

First, one must recognize that at some point any society will have foreign enemies, violent criminals, fraudsters and even conflict between well meaning citizens. Second, not just anyone should resolve these conflicts, else one will have a nightmare of vigilante justice or of the Libertarian idiocy of competing governments. One independent arbiter is needed that abides by certain principles, namely a constitution respecting Individual Rights. For a nation’s citizens to have freedom (from other men) no one has a right to initiate force on any of that nation’s citizens. However, since such initiated force is bound to occur, there MUST be a constrained and sensible power permitted only to use retaliatory force against the initiators. That power can only be in the hands of those charged with assuring The Constitution is adhered to by all citizens: those men fulfill the role of government.

Thus “the line” between citizens and government is between the use of initiated force and retaliatory force. This means government is limited to the police, the judiciary and the military. Of course, each branch requires certain derivative abilities, such as recording and enforcing property rights, enforcing and arbitrating contracts, determining criminal & tort penalties, and determining the appropriate response to outside aggression (initiated force by other societies).

Paulhus also focused on insurance companies. These are NOT socialist in any way, unless they are run by the State (as is the “Ontario Hospital Insurance Plan”… OHIP). In a free market, under certain officers, a corporation may appeal to potential clients to contribute a certain monthly payment, whilst guaranteeing a certain payment to that client in the event of certain disasters the client may experience. Yes, taken together, the clients are a group, but each has his or her own contractual agreement with the insurance corporation. Their contract is not imposed by the initated force of the State. Insurance is a sensible individualist economic endeavor, and has nothing to do with the political schema that is Socialism.

Highways and the provision of (clean) water plainly by the state, clearly cross “the line” that protects individuals from their government… and badly so! Both would be cheaper and more sensible if privately controlled, as private corporations learn what approaches are most cost efficient and competitive.

Given its tone, I have to denigrate the following comment by Paulhus:

“I wonder if you realize that even in a free market insurance system that you can’t possibly pay for all of your own healthcare.”

How do Paulhus suppose roads were built in America, before 1791? They were in fact all built privately with practicality and commercial value as the guiding principle. How does he suppose people managed to pay for health care prior to the socialization of medicine (including such schemes as Medicare and Medicaid)? When I was young, my father paid, monthly, what today would be viewed as a piffling portion of his income to privately insure our entire family for health care. If us kids had measles or some other relatively benign disease, our family doctor would still come to our house, even several times, just to make sure no complications arose. Further, if a family member had something dreadful, we were readily placed in hospital and received wonderful care.

Socialized medicine is a guarantee of national, medical stagnation.

[Defenders of socialized medicine have a certain view of the nature and abilities of other Men: other Men are pretty hopeless and helpless and cannot come up with better ways of doing things than can the socialist minded. The socialist has no grasp of what it means for an individual to be independent of mind and of action, and cannot possibly grasp a society of such individuals. To the socialist, no one is safe -least of all himself- until HE has control.]

How is it that you’re not okay with what you call socialized medicine, but you do seem to be okay with other systems being socialized (run by the government)? Where’s the line for you? Should a government run a police force? Should a government body enact regulations that provide clean water? Should a government run a judicial system? Who should build the highways? Etc.

I wonder if you realize that even in a free market insurance system that you can’t possibly pay for all of your own healthcare. There’s no way you come even close to paying the real cost of the healthcare you use. Even in your imagined system, you are a freeloader taking advantage of what others pay into the system in order to receive healthcare. Or do you not know how insurance works?