Wednesday, March 15, 2017

Health Insurance Death Spiral

Healthcare costs have increased from 5% of a $6.5 trillion GDP in 1960 to 20% of a $19 trillion GDP in 2017.  The average family cost of health insurance is $18,147 per year. Prices are not controlled by consumers because they don’t pay the bills themselves and too few refuse treatment because it’s a bad deal.


Health Insurance becomes unsustainable when medical costs double every 5 years. Consumers will balk, even when they are highly tax subsidized. These high tax subsidies are a big part of the problem. Our elected officials have been throwing money at healthcare and education for decades and they more they spend the worse it gets.  They ignore fixing obvious other mistakes like cost shifting, predatory malpractice settlements, defensive medicine, unnecessary tests, overpriced tests, predatory drug prices and the lack of any incentives for hospitals to lower costs.


The federal government is about to retain all of the future cost of healthcare.


They did it to themselves.  In 1965 the healthcare industry pushed for government subsidies and the creation of Medicare and Medicaid. They agreed to the creation of Obamacare, they are currently pushing to receive tax credits and now it’s over, like Venezuela. Rand Paul is right. We shouldn’t subsidize insurance companies with tax credits.


Nothing exceeds like excess. That’s the problem now facing the health insurance industry. The 15 million really sick and poor people who spend 50% of the US healthcare GDP are subsidized by unsustainable government programs.


Government currently includes non-citizen illegal aliens and terrorist refugees on welfare in these healthcare subsidies. This should stop because US welfare attracts illegals and refugees and we don’t need them at all. We need to pay off our $20 trillion debt.


The “end of life” expanses have risen from several thousand dollars to several hundred thousand dollars as families panic when older family members contract cancer or heart disease. Hospitals no longer cost hundreds of dollars per day; they cost tens of thousands of dollars per day.


Health insurance companies may lose all of their customers if they can’t offer affordable catastrophic policies to the health 50%.


They created this when they joined together with corporations to push through Medicare and Medicaid.


Government is stuck in a quandary. If government continues to pay 50% of the cost of the US healthcare GDP, costs won’t go down.


Costs will go down if government announces its step-down funding of healthcare.  Government should announce that it will begin to reduce all healthcare subsidies by 10% in 2018 and continue to reduce these subsidies by another 10% in 2019 and so on, until they no longer pay any subsidies.  The free market will take hold and reengineer all of healthcare. Actual healthcare costs will drop like a rock.


Unconstitutional Healthcare


Healthcare does not appear in the “enumerated powers” given to the federal government from the States in the US Constitution.  The Congress was required to write an Amendment to allow the federal government to fund healthcare and send it to the States for ratification, but they didn’t do this.  Instead, they passed Medicare and Medicaid in 1965 in violation of the US Constitution.


If Congress had followed the Law and written an Amendment to allow the federal government to fund healthcare, that Amendment would likely have failed to achieve ratification by the States and healthcare would have remained affordable. There would have been no incentive by providers to raise healthcare costs if patients had to pay their bills themselves. 


It is no coincidence that healthcare costs have risen in proportion to federal tax dollar funding. Legislation like Medicare and Medicaid will result, as predicted, in sovereign bankruptcy and destroy the United States. Benjamin Franklin said “It is a Republic, if you can keep it”.  He warned that the United States would not survive unless our elected representatives protected and defended the US Constitution (as written). 


When Healthcare was Affordable


Healthcare was affordable before 1965, the year Lyndon Johnson created Medicare and Medicaid.  After that, healthcare costs increased at double the rate of inflation and then some.  The reason for the increase in costs continues to be directly related to the amount of government subsidies granted to healthcare.


This phenomenon can be seen when the government relocates a military base in a rural town and rents double overnight.  It is simply the law of supply and demand.  Infusing new customers with money to an area increases demand for food, housing, energy and everything else.  The initial surge of demand continues until the supply catches up.


This is an old story. The land owners and merchants in these rural towns close ranks and lobby like mad to allow this expansion to occur, because they are sure to make more money. Land values rise with high demand and prices are adjusted upward until supply exceeds demand. Other citizens of these towns who rent their homes simply suffer the higher prices of everything. That’s why towns prefer home ownership and not rentals.


Norb Leahy, Dunwoody GA Tea Party Leader

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