Federal health care reform means paying more for less

by Byron Schlomach, Ph.D.
Goldwater Institute
One of my relatives received a letter Tuesday from his primary-care physician announcing that he would no longer accept private insurance or government payment. This doctor is moving immediately to accepting only direct payment from patients for his services. This is just the beginning of a cascade of consequences from passage of the federal health care bill.

Here’s some insight into things to come:

· Health insurance will get more expensive for most of us. A few unhealthy people will spend less because of federal subsidies. But two mandates make higher premiums inevitable: Everyone is guaranteed insurance coverage and everyone in your community will pay the same premium. Combine these requirements with the relatively modest IRS fine for not buying insurance as required by law, and it increases the likelihood that only the already-sick will buy coverage. Therefore, insurance premiums will increase.

· It will become harder to get health care. Many doctors, like my relative’s physician, will stop taking insurance (private or government-run), or they will move to another country where we can visit them. Or they will just leave the profession, not wanting to deal with the intrusion that will accompany the new federal mandates.

· States will raise taxes. The federal law expands Medicaid and states are required to match federal funding for the program. States are not as free to borrow and they cannot print money like the federal government. Short of miraculous levels of revenue growth then, states will have to raise taxes to cover the new mandatory expense.

This will only be the beginning. We may not be able to see the ultimate end today, but one thing is certain: save for the few, health care in America just got a lot more expensive.

Dr. Byron Schlomach is an economist and the director of the Center for Economic Prosperity at the Goldwater Institute.


  1. Delusional Bill says

    I spoke with a Cardiologist this week. He’s in a practice with about 10 other docs. He says that the entire practice will make a decision within weeks as to whether they take ANY Medicare patients in the future, including current ones. He indicated that the cost for simple procedures will be more than the reimbursement rate from medicare.

    I asked what it means for him on a personal level. He’s thinking of retiring completely.

    I asked what it will mean for the patient. He guaranteed higher costs and longer waits.

    Welcome to the wonderful world of Government Health Care. I believe a Texas saying applies to the whole thing. All hat and no cattle.

  2. Delusional Bill,

    My father is a cardiologist and he has said the same thing. But this is actually an issue that hits cardioligsts especially hard. They are really a different issue than most doctors. Cardiolgists are talking about taking over a 20% cut with out the medicare reimbursments and not taking medicare as you stated will save them money.

    This is not the case for most doctors because they are not as reliant on medicare, but it is a major issue.

  3. Delusional Bill says

    What will happen when the procedures that patients are used to getting when they see the doc are now forced to go elsewhere and then back to the doc to follow up? More hassle, higher cost.
    Sometimes the Law of Unintended Consequences can be seen from MILES ahead. But I suppose that particular law isn’t recognized by certain politicians. A lot of that going around…

  4. SO, what’s going to happen? The US going to do what Britain did and import more foreign SE Asain Inidan doctors?
    The ones who hired cheat teams to pass their medical boards?

    India is pretty free market these days, after years of Socialism stagnation. They offer to healthcare-deprived Brits “medical tours.” Fly to Delhi or Membai, get your surgery, a week or two or three convalescing with great hotel service, and fly back to Britain.

    Big business.

  5. Oops That’s Mumbai, formerly Bombay.

  6. Delusional Bill says

    One more thought. Verizon, AT&T, etc… are going to take a charge against profits to pay for the new mandates. The direct result will be smaller profits to tax, smaller dividends to shareholders. Each and every one of the rest of us will share a greater burden of the cost now. This won’t be because of greedy capitalists manipulating the market or some behind the scenes attempt to wring out more money for the bigwigs. It will be ALL because of the Hopey Changey folks compassion, caring and kindness. How’s that working for ya???

  7. Yeah, my friend’s cousin’s barber’s doctor said she is getting out of medicine because she doesn’t want to be part of the death panels and state sponsored mandatory abortions. Clearly this whole reform is going down in flames.

  8. One of my clients [doctors office] is doing away with Medicare patients entirely. Office manager told me that they are going to lose 30% of their patient base, but they are OK with that. They crunched the numbers and even with the loss of patients, they will end up being more profitable. Medicare is a low-pay and a slow-pay for them.

  9. The thing I’m wondering about the President’s plan is this part about pre-existing conditions… Is there any lingo in this reform about if there is a limit on what insurance providers can charge if you have a pre-existing problem?

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