Media Center | In The News
Simple, Free-Market Principles Solve Complex Problems
Date: November 10, 2011
By: Congressman Marlin Stutzman
“They say the world has become too complex for simple answers. They are wrong.” -Ronald Reagan
Genuine solutions are not the products of a “fire, ready, aim” approach. Open conversation will pave the way for workable health care reforms. I believe that a productive exchange must begin with an examination of costs. Right now, the national debate focuses too narrowly on insurance, rather than taking a serious look at the underlying costs. Certainly insurance is an important part of the larger discussion but we should remember that insurance covers the costs of health care. If costs aren’t addressed first, Washington will only prolong symptoms of a broken and complex system, instead of curing the disease.
As we weigh options for reforming health care in our country, we cannot abandon the free-market policies that have lowered costs and driven innovation in other sectors. Free-market principles should form the bedrock of an industry that represents a full 16.6 percent of our nation’s gross domestic product.
Over the past 10 years, health care costs have more than doubled. Unfortunately, that trend will only continue if health costs are not governed by the simple decisions that we consumers make for each of our other purchases. Economics 101 teaches us that individual choices determine the price of every good or service that the market offers. When consumers are able to make more informed decisions, prices will fall as doctors compete for patients. Unfortunately, Washington’s top-down policies distort this proven system and drive up prices.
The Patient Protection and Affordable Care Act, President Obama’s recent health care legislation, serves as the most blatant distortion of market forces. The law, with its maze of mandates, controls, tax hikes, and subsidies, will drive costs higher. Rather than dictating universal coverage through the bureaucratic regulations of the individual mandate or single payer systems, we should strive for broad accessibility through individual choice.
Current law has erected roadblocks for individual decision-making and private insurance. For example, health insurance companies are prohibited from competing across state lines. I’ve co-sponsored the Health Care Choice Act to replace Washington’s mandates with interstate competition. You can’t watch the nightly news without seeing a dozen ads for auto-insurance companies that are allowed to compete across state lines. If we allow health insurance to compete in similar fashion, we’ll increase access through lowered costs.
For those unable to purchase private plans, our nation has established Medicaid. Unfortunately, the program’s noble goals have been hindered by red-tape and top-down inefficiencies. That’s part of the reason that Medicaid patients are twice as likely to visit an ER than the uninsured. It’s a problem that demands real solutions.
President Obama has opted to expand the program, without genuine reform and at great expense to taxpayers and state governments. I’ve supported a prudent transition to a block grant system where each State has greater flexibility to manage their unique Medicaid programs, cutting the red tape, ensuring access to care, and keeping costs low. This proposal was included in the Republican Budget Resolution for this fiscal year.
I also believe that Congress should permanently fix the broken formula that compensates doctors who see Medicare patients. Washington has kicked that can down the road before. Without a permanent solution, delays and cuts could restrict access to care, as many doctors are forced to cut back on the number of Medicare patients they see. Inaction could further burden our ERs that care for those outside the traditional channels.
Now is the time for reform. I’m always open to serious proposals that address the costs at the heart of the problem. A quick band-aid won’t solve a deep-rooted problem. We need clear, careful, and free-market based policies. Hoosiers understand that clumsy, heavy-handed bureaucrats make lousy surgeons.
Congressman Stutzman represents the 3rd Congressional District of Indiana.
Read the full text here at KPC News.