What is free market health care?   Free market health care means no-government health care.  To the extent that the government is involved in any market, that market ceases to be free.  Government is force, pure and simple.  The brilliant Austrian economist Murray Rothbard defined government as “…a monopoly on violence.”  Any time that government funds are involved in any market, there are strings attached and usually price controls, fraud, bribes and corruption as those in power morph their position into wealth.  Medical markets are no exception.  There is nothing “free market” about Medicare.  That is why it is a disaster and a bankrupt Ponzi scheme. Government Ponzi schemes like Medicare and Social Security make Bernie Madoff  look like a saint.  Current workers are taxed for the current elderly.  There is no Medicare trust fund just as there is no Social Security trust fund.  There is simply a transfer of earnings from the young to the old.  The demand for medical care from the elderly is huge because this care is so heavily subsidized that little out-of-pocket exposure exists for the beneficiary.  Seriously, how many of the scooters you see old folks running around in would be sold if they were coughing up their own dough to buy them?  This is only one of  the countless examples of market distortions in a non-free market.  How many scooters are needed?  What should their price be?  These basic questions can never have accurate answers as long as the government is involved in their purchase.

What should a heart surgery cost?  How much should a month cost in a nursing home?  How much should my blood pressure medicine cost?  Once again, no one is asking these questions in a hardware store, are they?  If the water hose or the paint sprayer or the nails or hammer cost more at one store than at another a natural give and take and balancing takes place that insures that the buyer and seller end up at the right price.  This beautiful dance of the free market has been thwarted  in the practice of medicine and is in large part due to the presence of government payments and the politics and fraud that go along with socialism.

Someone I know just back from Israel, a country with a socialist health care system,  had a friend take an ambulance ride over there.  He said, “it only cost $100.” I quickly pointed out that it didn’t cost $100.  It may have cost only $100 to the one riding in the ambulance, but it cost people who were not riding in the ambulance  money, as well.  This is part of the sickness of socialism….no one really knows what anything costs.  I have heard patients say that they were going to wait until they turned 65 and enrolled in Medicare before they had their knee replaced so that it would be free.  But it’s not really free, is it?  What they really mean is…”I am going to wait to have my knee replaced until that young struggling family down the street where both parents are working two jobs will pay for my surgery.”  Too harsh?  But wait, you say, “didn’t this old person ‘pay into Medicare’ all of their working life?”  Of course they did and the money was squandered by politicians buying their votes, promising not to “touch their Medicare.”   So the money the current 65 year old person paid in is gone….long gone…and the care they receive is paid for by the current working young. But wait!  ”I’m elderly,” you say.  ”I pay Medicare premiums every month!”  This “premium” doesn’t even cover the drug benefits.  When does this Ponzi scheme madness stop?  It stops with bankruptcy.  It won’t stop suddenly.  It will begin with rationing and price controls (think drug shortages, waiting lists for surgeries, deaths from neglect), the usual bag of  government tricks that never works.  Aren’t there any other solutions?

I think that there may be one.  It is politically possible and consistent with the mood of the people in this country now. It is an expression of what is called “the doctrine of subsidiarity.”  Simply, the government that governs best governs closest to home.  Why not send Medicare to the individual states?  Why not let Oklahoma or Texas deal with the health issues in their own respective states temporarily on the way to eliminating federal Medicare?   Make private insurance available to the elderly who can afford it, and enroll those who can’t in Medicaid temporarily.  This would, of course, mean that the taxes that go to D. C. for this would no longer make the trip.   A transition to a situation and market where individuals take care of themselves, and local communities made up of volunteers and charitable organizations taking care of those who can’t care for themselves may be possible, I think, if this first step (getting Washington, D.C. out of the picture) is taken.  Many of the elderly in this country are waking up and realizing that “their Medicare” represents a black mark, not a benefit.  Fewer and fewer physicians are willing to see Medicare patients and their access to care will continue to be limited.  More and more of the Medicare population are clamoring for an alternative, as sadly they have none now, other than going completely uninsured. This new awareness on the part of the elderly may make bold changes more politically feasible than the gang in Washington perceives.

Medicare and other federal “entitlements” need to end or we are all bankrupt.  Maybe the best way to make this happen is to first send it home for the individual states to deal with.  Tinkering with the age of eligibility or deductibles simply delays the inevitable and doesn’t begin to solve this huge problem….it just “kicks the can farther down the road,” as the columnist Gary North has said.  Maybe one of the reasons that we have so many folks that are  uninsured  is that they are paying (through Medicare taxes) for scooters and heart surgeries and total knees for people they don’t even know and don’t have money left to take care of their own needs.  Thankfully, more and more of the elderly in this country are sick with the thought of bestowing this burden on their children and grandchildren.

G. Keith Smith, M.D.