Tuesday, August 16, 2011
Obama Throws Uninsured Under Magical Misery Bus
I’m so sick of politicians like Barack Obama. His assertion that the uninsured are the ones driving up the cost of health care is patently false. The biggest factor is federal and state regulations. The CATO Institute published a report back in 2004 outlining the real instigators of out of control insurance premiums. Even though this report is somewhat dated, it gives you an idea just how insidious government regulations can be:
The high cost of health services regulation is responsible for more than seven million Americans lacking health insurance, or one in six of the average daily uninsured. Moreover, 4,000 more Americans die every year from costs associated with health services regulation (22,000) than from lack of health insurance (18,000). The annual net cost of health services regulation dwarfs other costs imposed by government intervention in the health care sector. This cost exceeds annual consumer expenditures on gasoline and oil in the United States and is twice the size of the annual output of the motion picture and sound recording industries.
And because of excessive government regulations, more people are likely to drop their insurance:
Based on consensus estimates about the impact of higher prices on how many would likely drop health insurance, this increased cost implies a 3.8 percent reduction in the demand for coverage. This translates into 6.8 million uninsured whose plight arguably might be attributed to excess regulatory costs, or roughly one in six of the average daily uninsured.
And to add salt in the wound, governmental compliance also adds to the cost of health insurance:
Even though the government collects $2.1 billion in enforcement penalties (treated here as a transfer), the gross cost of health care fraud and abuse regulation is estimated to be $3.2 billion, inclusive of government regulatory costs, industry compliance costs, and efficiency losses from tax collection and regulatory costs. All industry compliance costs (including enforcement penalties) are treated as roughly equivalent to an excise tax.
Of course, we can’t expect statist like Barack Obama to hold the government responsible. He’s too busy throwing the American people under his Magical Misery Bus.