Health Insurance and Personal Responsibility

Some people who need health care have limited or no ability to pay for it. Does that fact justify massive federal intervention in medicine and forced wealth transfers? Far from it. Decades of political interference have driven up the costs of health care and insurance, stripping many of self-reliance and placing them in need. Unfortunately, free-market reforms made too little headway during the September 12 Republican debate, moderated by CNN's Wolf Blitzer.

To many on the left, need automatically warrants political intervention. That premise seems to have motivated Blitzer to ask Ron Paul about somebody who gets sick without health insurance:

A healthy 30-year-old young man has a good job, makes a good living, but decides... I'm not going to spend $200 or $300 a month for health insurance because I'm healthy, I don't need it. But something terrible happens, all of a sudden he needs it. Who's going to pay if he goes into a coma, for example?

After Paul said a few words about personal responsibility, Blitzer fired, "But congressman, are you saying that society should just let him die?" (Readers may judge for themselves whether Blitzer nimbly played devil's advocate here or rudely impugned Paul's character.)

At this point, a tiny misguided fraction of the audience cheered, sending the leftist blogosphere into a frenzy. But Paul's answer, which drew support from the overwhelming majority of the crowd, was that voluntary charity serves those in need, and the underlying problem of high costs stems from inflation of health-related expenses driven by political meddling.

Paul offered a pretty good off-the-cuff answer. (Note that I disagree with some other things Paul said, particularly regarding foreign policy.) But Blitzer's question merits a more complete response.

Blitzer's question presumes that the only three alternatives are overpriced insurance, letting him die, or forcing others to pay for his care. Thankfully, the real world offers us far better options.

By Blitzer's own assumptions, the man "has a good job" and "makes a good living." Has he managed to save up nothing from his earnings? (Unfortunately that would not be surprising, given the federal government's strong incentives in favor of borrowing and against saving.) It is totally appropriate for the hospital to send the man a bill, once he recovers, to recoup at least some of the expenses through regular payments. Likewise, those who fail to buy car insurance or house insurance should expect to pay for those things if something goes wrong.

But what about somebody who develops expensive health problems and truly cannot afford to pay? In those cases, hospitals and voluntary charity organizations remain free to step in and cover some or all of the costs.

Blitzer talks about "society" letting someone die, but whom does he mean? Each individual is part of society, so isn't the real question, "What are YOU going to do about it?" Treating "society" as some super-entity above and beyond the individuals who compose it causes two problems. First, it gives individuals an excuse to do nothing by their own initiative; second, it encourages many to ignore the actual victims of politicians' forced wealth transfer schemes.

"Society" has no right to violate the rights of minorities or of individuals. Doctors, hospitals, and individuals who wish to help pay for others' care remain free to do so, but they should not be forced by federal politicians to do so.

The deeper problem, the real reason a healthy 30 year old grows tempted to forgo health insurance, is that politicians have made the costs of health care and insurance ludicrously expensive.

Through destructive tax policies, the federal government linked health insurance to employment and encouraged the use of "insurance" for routine, every-day costs rather than for true emergencies. As a consequence, consumers have almost no incentive to seek economical care, and a considerable portion of each health dollar goes to insurance paperwork rather than actual care.

Today's politicians have taken dramatic action to turn health insurance into a gigantic wealth transfer scheme. That, indeed, is the entire premise behind the ObamaCare "mandate"; people must be forced to buy insurance because its artificially high costs subsidize the care of others. Consider, for example, the recent mandate from Health and Human Services that forces the insured who don't need birth control to pay for the birth control of others.

If we dismantled the federal controls over health care and moved toward a free market, that would put patients back in control of their health care, help contain costs, make insurance affordable again, empower more people to manage their health care costs, and ease the burdens on voluntary charity.

To take one example, expanding untaxed health savings accounts would give people the incentive to save and pay for their own health care and insurance. People should be able to buy health insurance out of their HSAs and contribute to HSAs regardless of their insurance.

The health-policy debate deserves better than inflammatory rhetoric about letting people die. Free-market reforms make it easier for people to live and pursue a healthy and autonomous life. In moving toward that goal, all that needs to die are the misguided political controls on health care and insurance that have so thoroughly debilitated those fields.

Also read: "ObamaCare: Whether You Like Your Privacy or Not, You Don't Get to Keep It"