Saturday, August 29, 2009

Townhall Healthcare

At a recent town hall meeting, a college student asked Pres. Obama how private insurance companies would be able to compete with the "Government Option". I don't know that Government Option has ever been defined, but I suspect it to mean a Federal agency handling health care to the public.
Pres. Obama silver-tongued an answer, which apparently made most people very comfortable. But, he really didn't answer the question.
The proper answer is that private insurance companies can exist in competition with a government insurance operation only at the discretion of the government. Government can impose taxes, various restrictive operations, and other mandates, such that profits are not possible. Private capital then has no reason for such investment and would usually withdraw its money, thereby shutting down the businesses. This can happen with or without competition from a government insurance operation. However, with the presence of government insurance there is more reason to put private companies out of business, in order to obtain clearly direct control.
Once government has complete control of health care, prices and service will be at the discretion of its management. Pres. Obama said that he has no intention of competing with private healthcare. Giving him the benefit of the doubt, he may not have such intention at the present time. However with the scenario developed above, it seems unlikely that power-driven government management would forgo the temptation.
If the public now accepts the Government option (government insurance) in healthcare, I predict that all health insurance companies will be out of business in five years and service and/or prices will be detrimental to the public. Such autocratic control will also lead to other controls not now anticipated.

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