We’re going to be hearing a lot about health care reform very soon. If you’ve never dug deep into this issue but consider yourself to be politically savvy, you’re about to find yourself completely lost very soon. I worked on health care reform as a political issue campaign, for several years, and it was some time before I knew up from down with any degree of confidence. Just when I thought I’d gotten a sense of it, I’d realize I had just hit the tip of the iceberg. So, when the tidal wave starts to hit in the coming days and weeks, and you realize you are lost, don’t feel bad; most people don’t know what they’re talking about when it comes to health care reform. Especially those on television and radio whom are paid to express opinions.

However, many people can understand the political implications of health care reform, because are much easier to follow. So for now, let’s keep it simple and limit this blog entry to politics and the very basics of health care.

Here is the general landscape: For Republicans and conservative interests, health care is a losing issue. In fact, it is lost. It is a lost issue because the only adequate answers to the challenges of health care require greater government involvement in one way or another. Conservative solutions like health savings accounts and plans with $5,000 deductibles require that health care be viewed as any other free market commodity – which it is not. Nor do consumers see health care this way. Think about it – who wants to go shopping for a “cheap” surgeon? Who is willing to forego medical treatment for their injured or sick child because of the costs? Who honestly thinks that a pre-tax savings account is a good deal compared to insurance that offers real coverage? This isn’t Blu-Ray vs HD DVD; this is healthy versus unhealthy, and everyone chooses the former.

Still, such is the mentality of those pushing so-called “consumer driven health care” concepts; the idea that people make health care choices like they make any other market choice. It’s ironic; conservatives claim the reason why health care is so expensive is because people use it “for every little thing” when a) high demand should theoretically drive competition to lower costs (which it has not done), and b) the opposite is actually true. One of the reasons why health care is so expensive is because Americans use health care too little, not too much. Preventive care – like getting checked out when you have a little problem – is much cheaper than waiting until that problem becomes a big and expensive. Catastrophic care is much more expensive than a check up, so if more people went to the doctor “for every little thing,” it would actually lower costs. This isn’t a theory; this is fact. This is how European countries and Canada – which have economies a fraction of the size of ours – can afford such huge national health care programs. They emphasize preventive care from child birth as a part of their culture. The result is less expensive health care and better health outcomes than ours.

Conservatives are also at a serious disadvantage on the issue because competition in the health care marketplace has driven costs upward, not down. As opposed to DVD players and other traditional commodities, competition in health care has a way of making things more pricey. Competition in health care has created an environment where hospitals and clinics amass the most expensive treatments in order to get one step ahead of their competitors. The result is a flood of super-equipped hospitals and clinics with the most expensive equipment requiring the most expensive maintenance, training, operation and insurance. It is interesting to note that the state of Maine – hardly heavily populated – has more MRI machines than the entire country of Canada. The result is  over-treatment (i.e. getting an MRI for a twisted ankle). This system creates the most expensive care in the world, because someone has to pay for all of that overhead. As health care costs go up, insurers are more reluctant to pay out because they are not seeing profits like they used to. So they reimburse less to doctors and hospitals, which makes hospitals want to do more tests so they can build up the bill and get paid properly.  The insurers then deny coverage to policy holders more often, drop coverage for the “riskiest” patients who need it the most, and raise premiums. Employers can’t afford the rising premiums, so they cut benefits to their workers. Now the average worker with a family has zero or inadequate health insurance and can’t afford the $12,000 a year for a health plan on the individual market. That family also can’t qualify for Medicaid coverage because they make too much money. So they’re stuck, waiting for some kind of solution and praying that their child doesn’t get sick this winter.

There are other moving pieces that could be added to this equation; it is by no means a definitive explanation of the health care system in America. But it is one example illustrating why health care in America is out of control.

For most of the world, health care has been viewed more as a right than a privilege. In America, it is a mix. People understand instinctively that getting health care is not a choice someone makes – it is something they have to get when they need it. But America is also unlike any other country in the world in that our first cultural instinct with any problem is to find a market-based solution. We usually try this route before exploring any other option.  Government-sponsored health insurance is considered to be a lost opportunity for free-marketers, and so the business community puts up much resistance. They use fear tactics. They point to the former Soviet Union and paint an unpleasant picture of dirty doctor smocks, rusty scalpels and long lines at the clinic. But despite that rhetoric, the “fear” of national health care has very little to do with actual fears people have of “large government.” They don’t mind a large military, for example, which has been the one common characteristic of every dictatorship and empire in world history. What they do mind is incompetence and a lack of value – something for which government bureaucracies in America have typically been known; especially under Republicans who campaign saying that government can’t do anything right, and then govern with no political incentive to make government work at all.

Regardless, the Obama health plan is not socialism, as it will be called by many in the media in the coming days and weeks. Though it does call for a larger role for government to play – which in my opinion is necessary – it is a far throw from true “government health care” i.e. Canada or France. Obama’s plan builds off of the current private and public systems and infuses them with cash, while mandating certain administrative changes that aim to save money. The result will be that insurers will effectively be subsidized by the government so they can continue to make a profit and that more people will have coverage. If that is government health care, it is government working for the insurance industry, with the side effect of universal coverage for consumers.

I’m still a bit on the fence with this issue. On paper, a single-payer health care system makes the most sense. It is cheaper; you never see a bill; the country lives longer and healthier. But there are drawbacks. And despite the fact that in numerous decades the free market has not been able to create a sustainable, affordable, and functional health care system, part of me really wants to see us figure it out on our own. Don’t let anyone fool you: there is something unique about America. In few other places is the entrepreneurial spirit such a vital a part of the national fabric as it is here, and that is something that we need to appreciate, despite the abuses and callousness of the private market. Perhaps Obama has the same sense of appreciation I have, and that is why he is not calling for an all-out single-payer health plan, despite the time being as ripe as any. FDR was the same – that is why, despite the crunch of the Great Depression, he did not pursue a socialist route back then. Instead his greatest accomplishment remains Social Security, which entitles recipients to payments but only after they’ve paid into the system. Americans were willing to accept that, and it is why Social Security is seen as much more than just another government program today.

With health care, however, it seems inevitable that the whole thing is coming down. and that it needs to start over from scratch. So who the hell knows?

Tags: health care