Healthcare Costs

From 7/21/09 e-mail to Congress:

I just heard Pres. Obama's television speech on socialistic healthcare.
He wonderfully outlined all of the great benefits of the bills presently in Congress, including reducing costs.
Unfortunately, he did not specify how the cost reductions are to be attained. I suppose we have to fill in that blank based upon our own economic experience. Health-care costs are composed of payments to doctors, nurses, assistants and various other healthcare workers. A good rule of thumb is that 80% of operating costs in a service industry are for salaries and wages to employees. The remainder is usually amortization for buildings and capital equipment and hospitals, clinics and doctors offices. Another possible cost reduction might be in reducing profit. However, profit in the healthcare industry is generally minimal, which is why I have not personally invested in it.
With that background, it is clear that to reduce costs, Pres. Obama's health care program will have to clearly reduce payments to health care employees. These employees either will have to accept the reduction or change to another industries, if they can find one. The net result will be fewer employees being reimbursed less than they are now. This would not set a good tone for desiring to maximize service as they continue in their jobs.
With this decreased availability of service personnel, the only obvious answer to cost reduction is to balance it off with reduced market requirements. The market requirements are already fixed at a high level and would likely increase with the passage of socialized healthcare, because everybody likes free stuff. But, the supply won't be there. Consumers will have to be denied treatment or have it significantly postponed. Will this be a better healthcare system? I personally believe that the public presently abuses the existing healthcare system, because they are unwilling to take responsibility for their own health control, but that is somewhat immaterial because we are considering market requirements, whether morally legitimate or not.
It may be that rationing healthcare would be appropriate for the American public, but it is not the American way. American should have the opportunity to waste their money if they so choose. They can do it on gambling, drugs and alcohol, excessively lavish homes, or healthcare. It is a right of the First Amendment.
I urge you to make every effort to cooperate with your Republican/Democratic associates to defeat this proposed socialistic healthcare program, and to do so in such a way that it will be a very long time before the proposal again rears its ugly head.