August 27 2012

Obamacare's Dirty Little Secret: Coercion

Charlotte Hays

When President Obama addresses women, he often says he wants them to be able to make their own decisions about health care.

Good luck with that, ladies, if Obamacare is allowed to stand. The Wall Street Journal has an editorial today on the secret weapon for cutting cost under Obamacare: coercion.

In assaulting Paul Ryan's Medicare reform, the editorial says, the intellectual architects of Obamacare have been laying out more details of how Obamacare will affect our lives. It’s not a pretty picture.

One of these architects, Peter Orszag, the former White House budget director, seemed to believe that there were vast savings to be had cutting down on waste when he was pushing Obamacare. Not so much now. He says that the belief that there are savings to be had through more competition is like believing in a "health-care competition tooth fairy."

Instead, Orszag now hails the Independent Payment Advisory Board—made up of what the Journal calls “15 philosopher kings who will rule over U.S. health care”—as a more realistic way to save money.

Who are these Orszag 15? Well, nobody knows. The board was supposed to be up and running by the end of September, but the White House is avoiding naming names for Senate confirmation until after the election. No one knows, either, what this group of geniuses will propose, but that too is part of the grand Orszag plan.

ObamaCare included dozens of speculative pilot programs that are supposed to make health-care delivery and business models less wasteful. Mr. Orszag's payment board is then supposed to apply the programs that "work" to all of U.S. medicine through regulation, without Congressional consent or legal appeal. Seriously.

It doesn't take a mythical childhood metaphor to mock this theory. Mr. Orszag's style of central planning—in what was already the heaviest regulated U.S. industry before ObamaCare—has failed over and over again in Medicare since the creation of the fiat pricing fee schedule in the 1980s.

 The surgeon and New Yorker writer Atul Gawande is another backer of Obamacare, and he has another idea: modeling medical care for the masses on the Cheesecake Factory. The editors observe:

Dr. Gawande's point is that medicine would function better if care were delivered by huge health systems that can achieve economies of scale, like commercial kitchens. Care ought to be standardized like preparing a side of beef, with a "single default way" to perform each treatment supposedly based on evidence, with little room for personalization.

No doubt health care could learn a lot about efficiency from a lot of industries, but to understand the core problem with assembly-line medicine, recall that ObamaCare actively promotes medical corporatism. The reason isn't to encourage business efficiency but for political control. Liberals believe in health-care consolidation because fewer giant corporations are easier for Mr. Orszag's central committee to control, and more amenable to its orders.

Gawande’s ideas would lead to the consolidation of medical services into giant organizations, something that is already happening. While these behemoths are easier for the government to direct, they are rarely best for the individual patient. Indeed, with government as the only consumer, patients will have less control over their own lives. Moreover, the IPAB will be insulated from democratic consent.

It was only the of Paul Ryan into the race that forced supporters of Obamacare to show their hands, providing clarifications that voters should know and weigh before making up their minds in November:  

What the debate over Mr. Ryan's reform is revealing is that the real health-care choice, and the real choice this November, is about the role of government. The Orszags of the world ultimately have what President Obama would call an "ideological" preference for coercion over individual choice. They want to impose the unilateral decisions of the state over those of millions of Americans.

The larger irony is that ObamaCare's architects claim that all of this will lead to more equity in the delivery of medical services, but in practice it will have the opposite effect. Americans of even middle-class means will not tolerate being told they cannot spend their own money to improve their own health or save the lives of their loved ones, so under price-controlled ObamaCare we will quickly see the emergence of a two- or even three-tier system outside the reach of government.

The affluent will get their own special level of service. Certainly Mr. Orszag, a vice chairman of corporate and investment banking at Citigroup, won't be getting treatment at some municipal hospital. The Cheesecake Factory is a great place to eat but you probably wouldn't want to be operated on there—especially if it's run by the government.

The administration's talk about "fairness" sounds hollow in light of this, doesn't it?

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