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The 'opt out' scam

| Friday, Oct. 30, 2009

The Democrats' all-new "opt out" idea for health care reform is the latest fig leaf for total government takeover of the health care system.

The first anyone heard of the "opt out" provision was about a week ago. Democrats keep changing the language so people can't figure out what's going on.

The most important fact about the "opt out" scheme allegedly allowing states to decline government health insurance is that a state can't "opt out" of paying for it. A state legislature can only opt out of allowing its citizens to receive the benefits of a federal program they're paying for.

That's not what most people are thinking when they hear the words "opt out." The term more likely to come to mind is "scam."

Which brings us to this question: Does the government or the free market provide better services at better prices?

There are roughly 1 million examples of the free market doing a better job and the government doing a worse job. Sometimes evidence for the superiority of the free market is hidden in liberals' own obtuse reporting.

In the past few years, The New York Times has indignantly reported that doctors' appointments for Botox can be obtained much faster than appointments to check on possibly cancerous moles. As The Times reported: "In some dermatologists' offices, freer-spending cosmetic patients are given appointments more quickly than medical patients for whom health insurance pays fixed reimbursement fees."

As the kids say: Duh.

This is the problem with third-party payer systems -- which is already the main problem with health care in America and will become inescapable under universal health care.

Not only do the free-market segments of medicine produce faster appointments and shorter waiting lines, but they also produce more innovation and price drops. The war on wrinkles is proceeding faster than the war on cancer, declared by President Nixon in 1971.

In 1960, 50 percent of all health care spending was paid directly by the consumer. By 1999, only 15 percent of health care spending was paid for by the consumer. The government's share had gone from 24 percent to 46 percent. At the same time, IRS regulations made it a nightmare to obtain private health insurance.

The reason you can't buy health insurance as easily and cheaply as you can buy car insurance -- or a million other products and services available on the free market -- is that during World War II, FDR imposed wage and price controls. Employers couldn't bid for employees with higher wages, so they bid for them by adding health insurance to the overall compensation package.

Health insurance premiums never passed through employees' bank accounts, so it seemed like employer-provided health insurance was free. Employers were writing off their employee insurance plans as a business expense.

So now, employer-provided health insurance is subsidized not only by the employees themselves through lower wages and salaries, but also by all taxpayers who have to make up the difference for this massive tax deduction.

Almost everything wrong with our health care system comes from government interference with the free market. If the health care system is broken, then fix it. Don't try to invent a new one premised on all the bad ideas that are causing problems in the first place.

Ann Coulter, a political analyst and attorney, is a columnist for Human Events.

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