Albert Einstein's View Of The Current Health Care Reform Legislation

As the Democrats and Obama continue to wrestle and settle on a passable health care reform bill, I am reminded of a famous Albert Einstein quote: "The definition of stupidity is doing the same thing over and over but expecting different results." Given the summary of past state level health care reform measures presented in a Reason magazine article by Peter Suderman (January 2009 issue), it looks like Albert is right when it comes to the current national health care debate:

• According to Mr. Suderman, in 1993 New York state initiated a program similar to the current Federal proposal that would forbid insurance companies from denying to anyone with a pre-existing condition. At the same time they also forbade insurance companies from charging different rates based on health status, sex, or age. As a result, the number of New York state residents enrolled in individual insurance policies went from about 4.7% of the non-elderly population to only .2% today. Relative to the national profile, the national percentage of non-elderly with individual policies went from 4.5% in 1994 to 5.5% in 2007. These results were studied and quantified by a 2009 Manhattan Institute study which concluded that the reduction in the number of people with individual policies was due to the steep rise in premium costs due to the state's regulations. The study estimated that getting rid of the offending regulation's, e.g. not denying because of pre-existing conditions, would reduce premium costs on individual policies by 42%. Seems pretty stupid to make the same mistake New York did in the national health care reform bill.
• In 1996, the state of Washington enacted the same type of changes that New York did, non-denial for pre-existing conditions and requiring that the same rates be charge regardless of sex, age, and health status. That state saw significant increases in health insurance premiums on individual policies within a few years, some of them seeing increases up to 78%. These increases were more than 10 times the rate of medical inflation according to a study presented at a meeting of the Association for Health Services research. Shortly after enacting these changes, none of the major insurers in the state offered plans that included maternity coverage according to Mr. Suderman's article. Seems pretty stupid to enact the same mistakes Washington did in the national health care reform bill.
• According to an article in Health Affairs magazine by Patricia Lynch in 2008, individual insurance markets in Kentucky, Massachusetts, Maine, New Hampshire, New Jersey, and Vermont so individual policies become much more expensive without a significant number of uninsured after those states passed legislation guaranteeing coverage regardless of pre-existing conditions. Seems pretty stupid to enact the same mistakes these states did in the national health care reform bill.
• In 2007, Massachusetts passed health care reform legislation that required everyone in the state to have health insurance coverage. This is identical to the currently proposed bill in Washington that would require everyone in the nation to have health care coverage, regardless of how young and healthy they were or how rich they were, i.e. they could pay for their own health care costs out of pocket. Unfortunately, Massachusetts health insurance premium costs rose substantially faster than the national average, making the state's individual policies the most expensive in the nation. The legislation did not reduce state health care costs with a 2009 Rand study estimating that the state's health care costs will increase 8% a year for the foreseeable future, much higher than the growth in the state economy. According to the Boston Globe's reporting, the state's health care costs could push businesses and families towards bankruptcy and threaten to topple the state's universal coverage system. Seems pretty stupid to enact the same mistakes Massachusetts did in the national health care reform bill.
• In Maine, the 2003 reform plan in that state set up a government insurance option similar to the national public plan, which at this point in time is NOT in the national legislation. The plan was supposed to cover all of the 128,000 state residents (about 10% of the total population) who did not have insurance. But according to Mr. Suderman's article and sources, in 2007 about 10% of the state was still uninsured despite the government program. Meanwhile, individual insurance premiums went up an average of 74% in the four years after the government plan was established. Seems pretty stupid to enact the same mistakes Maine did in the national health care reform bill.
• In Tennessee, that state's plan for universal coverage, established in the late 1990s, turned out to be even worse. Rather than provide universal coverage, the costs of the program expanded so much that the state was forced to remove 170,000 individuals from its insurance rolls, contrary to the avowed goal of the program to insure everyone. Seems pretty stupid to enact the same mistakes Tennessee did in the national health care reform bill.
• Not covered in the article is the fact that several other states such as Texas have enacted significant tort reform measures as it applies to health care in their respective states. As a result, they have seen significant reductions in all types of positive trends in their respective health care costs including reductions insurance premiums, reductions in malpractice premiums, more health care providers which reduced health care expense, and other positive changes. (See our post in late 2009 for details by state.) Seems pretty stupid to NOT enact the same tort reforms that Texas and other states did in the national health care reform bill.

Many of the components in the current bills before Congress have been tried at the state level and have been utter disasters. What makes anyone think that the Federal government, with all of its waste and inefficiencies, can do any better than the states did with their ill advised health care reforms? As stated many times in this blog, the process needs to start over by enacting the suggestion in Step 28 of "Love My Country, Loathe My Government:"

Convene an expert panel to undertake an in-depth national economic study to determine the real root causes of spiraling health care costs and recommend appropriate actions to eliminate them. Voters, not Congress, will approve these recommendations.

This would emulate the success that other panels have had in our nation's history (Manhattan Project, Apollo Space Program, 9-11 Commission), remove the lobbyists and politics from the equation, and do real analysis to identify and cure the root causes of the problem. It would not just repeat the mistakes of the past at the state level.

Failure to do anything else would make Einstein look like a genius when the current health care legislation, if passed, fails miserably just like similar plans failed at the state level. Stupidity is indeed doing the same health care reforms over and over and expecting them to work when they have never worked before.

Visit our website at www.loathemygovernment.com to order an autographed copy of the book, "Love My Country, Loathe My Government -Fifty First Steps To Restoring Our Freedom and Destroying The American Political Class" and to sign up for the cause. The book is also available online at Amazon and Barnes And Noble.