Just about everyone makes the same assumption when they first think about how to reform American health care. Well, a lot of people don’t have insurance. Health care isn’t cheap even with insurance, so we really ought to expand insurance coverage. Otherwise, how can people afford it? The thinking is straightforward and reasonable enough on the surface. It doesn’t take much of a logical leap to go from this line of thinking to making the expansion of insurance coverage your number one health care reform priority. If you’re an empathetic person, it could even become a sort of moral imperative. Without insurance, people won’t be able to afford health care, since it’s so expensive. We need to make sure that people get insurance.
I couldn’t blame anyone for thinking this way at first. This is how the left and a sizable minority of the right perceives the problem of health care reform. Put succinctly, their proposed solution is to expand coverage at all costs.
While I sympathize with their line of thinking, I consider it deeply flawed. An expansion of insurance coverage would certainly be a good thing, but it shouldn’t be our top, all-consuming priority, and that’s true for a lot of reasons. Over the coming days, I’ll go through some of them, but I want to make a basic fiscal argument here at the outset.
According to new research from the Centers for Medicare and Medicaid Services, health care spending in the United States is estimated to rise to 19.6% of our Gross Domestic Product (GDP) by 2021, which I remind you is less than a decade from now. In other words, even though as a nation we already spend an undeniably massive amount on health care, that percentage will only continue to grow and grow.
You might be able to guess where my argument’s going now. If we expand coverage without lowering costs, our health care expenditures will only skyrocket upward faster. Consider the implications of this for the federal and state governments. An enormous portion of federal spending already goes toward Medicare and Medicaid today, and their percentage of the budget expands every year. The budgets of most state governments are already in the red due to their portion of the Medicaid expenses, not to mention their own health care plans.
The federal government is already nearly $16 trillion dollars in debt, and this year’s trillion-dollar deficit won’t help matters. Many state governments are teetering on the edge of default as well.
As health care costs continue to spiral upward, more and more people will lose the ability to pay for their own coverage, or their employers will need to drop the company health insurance plans in order to avert bankruptcy. If our attitude regarding health care reform is expand coverage at all costs, the government will become the insurer of last resort, either directly or indirectly through tax credits.
In this way, these rising health care costs will be shifted to the government, which will already be burdened from the cost growth of its existing health care programs. The resulting explosion of government health care spending will spell our ruin.
So, that’s a basic reason for why conservatives shouldn’t embrace the idea of expanding coverage as our primary mission in reforming health care. Instead, we ought to focus on driving down health care costs. The benefits are obvious and many. First, lowering health care costs will reduce out-of-pockets costs for all Americans, alongside reducing our insurance premiums. Second, it will shrink government spending on health care, which will help to relieve budgetary pressures and the threat of imminent bankruptcy. Finally, lowering health care costs will make health insurance more affordable, thereby increasing access and yes, expanding coverage.
Conservatives aren’t heartless. Everyone would like to see health insurance coverage expand. We would simply like to do it in a way that helps all Americans, while avoiding fiscal collapse.
There are many conservative ideas to lower the costs of health care. Here’s a few that I wrote about for FreedomWorks:
Stay tuned in the coming days as I continue this series on true, conservative health care reform.