Obamacare Meltdown: We Don’t Need Gov’t to Provide “Safety Net” for the Poor

by Ron Paul

The decision of several major insurance companies to cut their losses and withdraw from the Obamacare exchanges, combined with the failure of 70 percent of Obamacare’s health insurance “co-ops, ” will leave one in six Obamacare enrollees with only one health insurance option. If Obamacare continues on its current track, most of America may resemble Pinal County, Arizona, where no one can obtain private health insurance. Those lucky enough to obtain insurance will face ever-increasing premiums and a declining choice of providers.

Many Obamacare supporters claimed that the exchanges created a market for health insurance that would allow consumers to benefit from competition. But allowing consumers to pick from a variety of government-controlled health insurance plans is not a true market; instead it is what the great economist Ludwig von Mises called “playing market.”

Unfortunately, if not surprisingly, too many are drawing the wrong lessons from Obamacare’s difficulties. Instead of calling for a repeal of Obamacare and all other government interference in the health care market, many are calling for increased penalties on those who defy Obamacare’s individual mandate in order to force them onto the exchanges. Others are renewing the push for a “public option,” forcing private companies to compete with taxpayer-funded entities and easing the way for the adoption of a Canadian-style single payer system.

Even those working to restore individual control over health care via tax deductions, credits, and expanded health savings accounts still support government intervention in order to provide a “safety net” for the poor. Of course, everyone — including libertarians — shares the goal of creating a safety net. Libertarians just understand that a moral and effective safety net is one voluntarily provided by individuals, religious organizations, and private charities.

Government has no legitimate authority to take money from taxpayers to fund health care or any other type of welfare program. Government-run health care also does not truly serve the interest of those supposedly “benefiting” from the program. Anyone who doubts this should consider how declining reimbursements and increasing bureaucracy is causing more doctors to refuse to treat Medicaid and Medicare patients.

Medicaid patients will face increasing hardships when, not if, the US government’s fiscal crisis forces Congress to make spending cuts. When the crisis comes, what is more likely to be cut first: spending benefiting large corporations and big banks that can deploy armies of high-powered lobbyists, or spending benefiting low-income Americans who cannot afford K Street representation?

Contrary to myth, low-income individuals did not go without care in the days before the welfare state. Private, charity-run hospitals staffed by volunteers provided a safety net for those who could not afford health care. Most doctors also willingly provided free or reduced-price care for those who needed it. The large amount of charitable giving and volunteer activity in the United States shows that the American people do not need government’s help in providing an effective safety net.

The problems plaguing the health care system are rooted in the treatment of health care as a “right.” This justifies government intervention in the health care marketplace. This intervention causes increasing prices and declining quality and supply. Ironically, those who suffer most from government intervention are the very people proponents of these programs claim to want to help. The first step in restoring a health care system that meets the needs of all people is to start treating health care as a good that can and should only be provided via voluntary actions of free people.

This column was published by the Ron Paul Institute.

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  • JosephConrad

    INSURANCE CO.s ARE THE WORST RUN ENTITIES IN THE U.S. AFTER BANKS & THE FED.
    IF YOU WANT TO STEAL & COMMIT PROFITABLE FRAUD, INSURERS ARE THE WAY TO GO.
    THEY ARE A PONSI SCHEME LIKE NO OTHER WITH THEFT GALORE!

    • Iza Bourne Greene

      My Late Wealthy Uncle proved to me what you say is true. Dying with multiple forms of cancer and multiple medical benefit plans showed me how big named doctors and hospitals literally double and tripled billed the systems and were never investigated no matter how many times someone blew the whistle on them, raped for services never rendered for medications never used. These corporations and educated criminals have no moral value whatsoever. I remember one snake when finding out my Uncle’s suffering had finally ended screaming “I could have done so much for that man! I kid you not.

  • Mick McNulty

    The US will eventually see the return of poverty diseases like TB, polio, diptheria and scarlet fever, and skin conditions like ringworm and impetigo, and pests like head-lice and scabies. It’s the same in Britain where the Conservatives are taking British society back to Margaret Thatcher’s “Victorian values”.

    The difference between then and now is now the different classes interact more through superstores, banks, post offices, gas stations etc. Other common vectors are the police, law courts and prisons.