LibertyVox
08-04-2010, 05:55 PM
http://www.thefreemanonline.org/featured/guess-who-paved-the-road-to-socialized-medicine/#
So why did the Republicans help create the largest federally funded health-entitlement program since 1965? It seems the Republicans merely caved into the Democrats’ savvy political strategy, which went something like this: Let’s propose a new government program for children and fund it with cigarette taxes. Then, if Republicans oppose “KidCare” we’ll charge that they don’t care about children and that the only reason they oppose it is because the Republicans get large sums of money from the tobacco industry. This was a brilliant political strategy. Yet the consequences of SCHIP will affect many, if not all, Americans.
One of the greatest dangers of SCHIP is that it will reduce the number of privately insured children. That is because SCHIP creates incentives for families and employers to drop private health insurance and instead take government subsidies for health care. The Congressional Budget Office expects that half of the participants in the new program will be families that give up private insurance. “That’s what happened when Medicaid opened in 1987 to pregnant women and their children with incomes 250% of the poverty level,” Robert Goldberg of George Washington University writes. “Between 1988 and 1995, the percentage of children covered by private insurance fell to 64% from 72%. At the same time, the percentage of children covered by Medicaid climbed to 23.1% from 15.5%. Studies show that at least threefourths of the shift was the result of parents dropping private coverage for themselves and their children. This new program will have the same effect.”
Another concern is that SCHIP could eventually become mandatory for all children, regardless of family income or need. That is what happened to the elderly. Consider that initially Medicare was established to help only poor elderly people, while the better-off were told they could keep their private health insurance. However, after Medicare was passed in 1965, the federal government garnered enough muscle to force private insurers to drop the nonpoor elderly, leaving them no alternative but to join Medicare. Moreover, the federal government has made it mandatory to enroll in Medicare Part A (which pays for hospital care) if you receive Social Security benefits. Given government’s track record, it is quite likely it could force children to participate in SCHIP. It is only a matter of time before we start seeing state laws that say, “Your child must join SCHIP or he can’t attend public school.”
SCHIP is also likely to lead to higher health-care costs. Again, one need only look to Medicare to see how that would happen. Medicare was created with the purported goal to help reduce the elderly’s out-of-pocket health-care expenses. However, their medical costs have increased dramatically since 1965. Medicare grew much faster than ever anticipated, and consequently, the elderly are now forced to pay higher deductibles and copayments. In terms of absolute dollars, their outof-pocket expenses were reduced by only $9 during Medicare’s first five years, from $234 to $225 per capita between 1966 and 1971. Since then, Medicare out-of-pocket costs (copayment and deductible amounts) have grown to $757 per beneficiary in 1995—about $26 billion total. Additionally, seniors pay millions out of pocket for non-covered services, such as prescription drugs. Clearly, Medicare did not meet its stated goal. It is unlikely that SCHIP can do so either.
So why did the Republicans help create the largest federally funded health-entitlement program since 1965? It seems the Republicans merely caved into the Democrats’ savvy political strategy, which went something like this: Let’s propose a new government program for children and fund it with cigarette taxes. Then, if Republicans oppose “KidCare” we’ll charge that they don’t care about children and that the only reason they oppose it is because the Republicans get large sums of money from the tobacco industry. This was a brilliant political strategy. Yet the consequences of SCHIP will affect many, if not all, Americans.
One of the greatest dangers of SCHIP is that it will reduce the number of privately insured children. That is because SCHIP creates incentives for families and employers to drop private health insurance and instead take government subsidies for health care. The Congressional Budget Office expects that half of the participants in the new program will be families that give up private insurance. “That’s what happened when Medicaid opened in 1987 to pregnant women and their children with incomes 250% of the poverty level,” Robert Goldberg of George Washington University writes. “Between 1988 and 1995, the percentage of children covered by private insurance fell to 64% from 72%. At the same time, the percentage of children covered by Medicaid climbed to 23.1% from 15.5%. Studies show that at least threefourths of the shift was the result of parents dropping private coverage for themselves and their children. This new program will have the same effect.”
Another concern is that SCHIP could eventually become mandatory for all children, regardless of family income or need. That is what happened to the elderly. Consider that initially Medicare was established to help only poor elderly people, while the better-off were told they could keep their private health insurance. However, after Medicare was passed in 1965, the federal government garnered enough muscle to force private insurers to drop the nonpoor elderly, leaving them no alternative but to join Medicare. Moreover, the federal government has made it mandatory to enroll in Medicare Part A (which pays for hospital care) if you receive Social Security benefits. Given government’s track record, it is quite likely it could force children to participate in SCHIP. It is only a matter of time before we start seeing state laws that say, “Your child must join SCHIP or he can’t attend public school.”
SCHIP is also likely to lead to higher health-care costs. Again, one need only look to Medicare to see how that would happen. Medicare was created with the purported goal to help reduce the elderly’s out-of-pocket health-care expenses. However, their medical costs have increased dramatically since 1965. Medicare grew much faster than ever anticipated, and consequently, the elderly are now forced to pay higher deductibles and copayments. In terms of absolute dollars, their outof-pocket expenses were reduced by only $9 during Medicare’s first five years, from $234 to $225 per capita between 1966 and 1971. Since then, Medicare out-of-pocket costs (copayment and deductible amounts) have grown to $757 per beneficiary in 1995—about $26 billion total. Additionally, seniors pay millions out of pocket for non-covered services, such as prescription drugs. Clearly, Medicare did not meet its stated goal. It is unlikely that SCHIP can do so either.