The “Other” Election Debate about Single-Payer Health Care

Stop me if you’ve heard this one before: There’s a national election going on, and single-payer health care is one of the prime points of contention. It’s not what you think.

Voters in Great Britain head to the polls on Dec. 12 in the country’s third general election in just more than four years. The ongoing Brexit debate, about whether or how Britain will leave the European Union, necessitated the early election. With his Brexit agreement with the European Union bogged down in Parliament, Conservative Prime Minister Boris Johnson felt the need to go to the country, to obtain a mandate to push the deal through.

But health care has also taken a prime place in the campaign. The Labour Party, led by Jeremy Corbyn, have raised the specter of the Conservatives “putting the National Health Service up for sale” to reach a post-Brexit trade agreement with the United States.

The issue of the NHS’s status in a U.S.-U.K. trade agreement came up during President Trump’s state visit to Britain in June. In a press conference with then-Prime Minister Theresa May, Trump originally said “everything with a trade deal is on the table,” only to walk those comments back one day later. With the president due back in London on Tuesday for a NATO summit, and Labour trailing in the polls only a week before election day, Corbyn will doubtless make the issue a focal point of Trump’s visit.

Drug Pricing Issues

Last week, a series of government documents leaked that summarized preliminary trade discussions between American and British negotiators. Corbyn waved around heavily edited versions of the documents at his first debate with Johnson earlier this month. Government officials had redacted large swathes of the documents, to preserve the sensitive nature of the trade talks, but those discussions escaped into public view via the unauthorized leak.

The leaked documents confirm that drug pricing remains a prime point of contention regarding a U.S.-U.K. trade deal. One document, summarizing a series of meetings held in July, includes a lengthy section entitled “Intellectual Property: Patents and Pharmaceuticals.”

Britain’s Channel Four reported in October that two linked issues drive the talks. First, American negotiators prefer the United States’s longer period of data exclusivity as part of any Anglo-American trade agreement. This policy would seek to preserve incentives for innovation, allowing manufacturers to maintain their exclusive intellectual property for longer periods of time.

Britain Wants to Keep Rationing Health Care

Second, the American side “want[s] to remove the UK’s ability to block American drugs not deemed ‘value for money.’” The BBC notes that Britain’s National Health Service relies on the National Institute for Health and Care Excellence (NICE) “on what offers the best benefits for patients balanced against value for money:”

The NICE regime, introduced 20 years ago, is seen as a great success in helping the NHS strike realistic pricing deals. A recent deal for the cystic fibrosis drug Orkambi was hailed by health leaders in England as a big win for the system, with the American manufacturer Vertex, having initially refused to bring down its price, eventually signing up.

However, the BBC neglected to mention that, as part of its “negotiations” with the manufacturer Vertex, NICE denied thousands of British patients access to Orkambi for more than three years, because the drug exceeded cost limits set by the government body.

It seems somewhat ironic that in October, a spokesman for Britain’s Department for International Trade told Channel Four that the British government “could not agree to any proposals on medicines pricing” that would “reduce clinician and patient choice.” For the past three years, patients had no choice for accessing Orkambi—bureaucrats called the drug too expensive, therefore British cystic fibrosis patients could not receive it.

End Foreign Freeloading

Britain’s drug pricing policies cost American and British patients alike. British patients pay when they cannot get access to treatments the government deems too expensive, and their health suffers as a result. And American patients pay when Britain, like other European nations, free rides on American innovation—allowing U.S. consumers to pay far more for pharmaceuticals, absorbing a disproportionate share of drugs’ research and development costs.

U.S. House Speaker Pelosi and others have suggested importing socialist-style price controls to the United States to “solve” the free-rider problem—a variation of the “If you can’t beat them, join them” approach. But a better solution would involve American negotiators taking up the issue of foreign freeloading with other governments as part of trade talks—the exact policy pursued as part of the U.S.-U.K. discussions.

Trump’s visit to London so close to Britain’s election has prompted speculation about its political ramifications. Johnson has warned Trump not to endorse his re-election bid, fearing it may only encourage Britons to vote for his Labour opponents instead.

But on policy, the United States absolutely should work to stop foreign free-riding over pharmaceutical prices. Moreover, we would do the British people no small favor if, in the process of ending that free-riding, we could stop that country’s health care system from denying patients access to life-saving treatments that a government board deems too costly.

This post was originally published at The Federalist.

UK Debate Shows Single Payer’s Shortcomings

This week’s debate featuring candidates for the highest office in the land showed all the problems with single-payer health care. Except the debate took place in Britain, not the United States.

During Tuesday’s debate between the current British prime minister, Conservative Boris Johnson, and the man who wants to replace him, Labour’s Jeremy Corbyn, both agreed that Britain’s National Health Service (NHS) currently provides poor care to patients. That surprising consensus in an otherwise-contentious debate illustrates why the United States shouldn’t import Britain’s poor quality of care to our shores.

‘Make Sure Nobody Else Goes Through This Pain’

The debate featured a question by a hospital-based physician, who said he “see[s] firsthand the unsustainable pressure on the NHS—elderly patients stuck on trollies in corridors, unacceptably long waiting times for operations.” He asked how the health service can meet future demands, when it arguably doesn’t meet the current patients’ needs.

After calling the NHS a “wonderful and brilliant institution,” Labour’s Corbyn then recounted a heart-rending tale of how it let down one patient just this week:

Yesterday, a woman—friend of mine—died at 6:30 yesterday morning from secondary breast cancer. The day before, she’d gone to hospital, at the recommendation of her GP [general practitioner], in order to get urgent treatment. She waited eight hours. The nurses that were trying to help her were unable to get anyone to see her because they were under such strain and stress. And so she recorded a video saying, ‘Please, in my memory—make sure nobody else goes through this pain.’

Corbyn then concluded by calling for increased spending, claiming that the NHS stands as “one of the most civilized things about this country.” His friend might have objected to that characterization—but thanks to the NHS, she never lived to see Corbyn make his comment.

Waiting Times

Johnson likewise pledged additional funding, but the effects of choices made in the last several years have affected NHS. In a May report, Congressional Budget Office analysts stated that “the relatively slow growth in [payments to hospitals] since 2010 ha[ve] created severe financial strains on the [British] health care system. Provider payment rates have been reduced, many providers have incurred financial deficits, and wait times for receiving care have increased.”

While Corbyn’s comments brought home the personal impact of the NHS’ failures, data compiled by the House of Commons Library (Britain’s version of the Congressional Research Service) demonstrates that stories like the one Corbyn recounted have become far too common.

Charts like those below need very little explanation. A roughly five-fold increase in the number of patients waiting more than four hours in emergency rooms since 2011:

A nearly five-fold increase in the number of patients waiting on trollies in emergency rooms for hours after their doctors decided to admit them as inpatients:

A 40 percent increase in the number of people on the NHS waiting list, such that it now totals 4.56 million people, or nearly 7 percent of the entire British population of approximately 67.5 million:

A majority of NHS trusts breaking the target that a patient should wait “only” 18 weeks (i.e., four and a half months) for treatment led by a consultant (i.e., a medical specialist):

More than three-quarters of NHS trusts breaking the target that patients should receive their first treatment for “urgent” cancer within 62 days (i.e., two months) of their GP referral:

All this poor performance—people waiting and waiting for care—comes as the number of doctors and nurses within the NHS has increased over the past decade (and in the case of physicians, has increased by nearly 20 percent).

Fundamental Dilemma

Johnson and Corbyn can pledge all the additional money for the NHS they want. Their promises won’t solve the health service’s fundamental problem—and may end up bankrupting Britain in the process.

Britain’s pledge of an NHS “free at the point of use” creates the problem. People who believe they can receive “free” care over-consume it, with the types of rationing and wait times seen in the past several years the inevitable consequence.

Voters in the United States who tuned into Wednesday’s Democratic debate to see the candidates talk single payer should have spent their time watching Tuesday night’s prime ministerial debate instead. Few who watched that event would come away thinking that single payer would represent anything less than an unmitigated disaster for the American health care.

This post was originally published at The Federalist.

Analyzing the Gimmicks in Warren’s Health Care Plan

Six weeks ago, this publication published “Elizabeth Warren Has a Plan…For Avoiding Your Health Care Questions.” That plan came to fruition last Friday, when Warren released a paper (and two accompanying analyses) claiming that she can fund her single-payer health care program without raising taxes on the middle class.

Both her opponents in the Democratic presidential primary and conservative commentators immediately criticized Warren’s plan for the gimmicks and assumptions used to arrive at her estimate. Her paper claims she can reduce the 10-year cost of single payer—the amount of new federal revenues needed to fund the program, over and above the dollars already spent on health care (e.g., existing federal spending on Medicare, Medicaid, etc.)—from $34 trillion in an October Urban Institute estimate to only $20.5 trillion. On top of this 40 percent reduction in the cost of single payer, Warren claims she can raise the $20.5 trillion without a middle-class tax increase.

Meet the Radical Technocrat Helping Democrats Sell Single-Payer

If anyone had doubts about the radical nature of Democrats’ health care agenda, they needn’t look further than the second name on the witness list for this Wednesday’s House Ways and Means Committee hearing on single-payer health care: Donald Berwick of the Institute for Healthcare Improvement.

If that name sounds familiar, it should. In summer 2010, right after Obamacare’s passage, President Obama gave Berwick a controversial recess appointment to head the Centers for Medicare and Medicaid Services (CMS). Democrats refused to consider Berwick’s nomination despite controlling 59 votes in the Senate at the time, and he had to resign as CMS administrator at the end of his recess appointment in late 2011.

Berwick’s History of Radical Writings

Even a cursory review of Berwick’s writings explains why Obama’s only option was to push him through with a recess appointment, and why Democrats refused to give Berwick so much as a nomination hearing. As someone who read just about everything he wrote until his nomination—thousands of pages of journal articles, books, and speeches—I know the radical nature of Berwick’s thinking all too well. He believes passionately in a society ruled by a technocratic elite, thinking that a core group of government planners can run the country’s health care system better than individual doctors and patients.

Here is what this doctor believes in, in his own words:

  • Socialized Medicine: “Cynics beware: I am romantic about the National Health Service; I love it. All I need to do to rediscover the romance is to look at health care in my own country.”
  • Control by Elites: “I cannot believe that the individual health care consumer can enforce through choice the proper configurations of a system as massive and complex as health care. That is for leaders to do.”
  • Wealth Redistribution: “Any health care funding plan that is just, equitable, civilized, and humane must—must—redistribute wealth from the richer among us to the poorer and less fortunate.”
  • Shutting Medical Facilities: “Reduce the total supply of high-technology medical and surgical care and consolidate high-technology services into regional and community-wide centers … Most metropolitan areas in the United States should reduce the number of centers engaging in cardiac surgery, high-risk obstetrics, neonatal intensive care, organ transplantation, tertiary cancer care, high-level trauma care, and high-technology imaging.”
  • End of Life Care: “Most people who have serious pain do not need advanced methods; they just need the morphine and counseling that have been available for centuries.”
  • Cost-Effectiveness Rationing of Care: “The decision is not whether or not we will ration care—the decision is whether we will ration with our eyes open.”
  • Doctors Putting “The System” over their Patients: “Doctors and other clinicians should be advocates for patients or the populations they service but should refrain from manipulating the system to obtain benefits for them to the substantial disadvantage of others.”
  • Standardized “Cookbook Medicine”: “I would place a commitment to excellence—standardization to the best-known method—above clinician autonomy as a rule for care.”

For those who want a fuller picture of Berwick’s views, in 2010-11 I compiled a nearly 30-page dossier featuring excerpts of his beliefs, based on my comprehensive review of his prior writings and speeches. That document is now available online here, and below.

Where’s the Political Accountability?

Some of Berwick’s greatest admiration is saved for Britain’s National Health Service on the grounds that it was ultimately politically accountable to patients. For instance, Berwick said his “rationing with our eyes open” quote was “distorted,” claiming that

Someone, like your health insurance company, is going to limit what you can get. That’s the way it’s set up. The government, unlike many private health insurance plans, is working in the daylight. That’s a strength.

When running for governor of Massachusetts in 2013, Berwick claimed he “regrets listening to White House orders to avoid reaching out to congressional Republicans.” But that doesn’t absolve the fact that Berwick went to great lengths to avoid the political accountability he previously claimed to embrace.

It also doesn’t answer the significant questions about why Obama waited until after Obamacare’s enactment to nominate Berwick—deliberately keeping the public in the dark about the radical nature of the person he wanted to administer vast swathes of the law.

Thankfully, however, Wednesday’s hearing provides a case of “better late than never.” Republicans will finally get a chance to ask Berwick about the extreme views expressed in his writings. They will also be able to raise questions about why Democrats decided to give him an official platform to talk about single payer (and who knows what else).

This post was originally published at The Federalist.

Note to Britain: You Can Have Your NHS

As expected, the American press has heavily covered President Trump’s visit to Europe, including his time spent in Great Britain. But a row (that’s British for “argument”) that has gone under-reported on this side of the Atlantic also holds major implications for American patients.

Based on comments the President made earlier in the week, British politicians now believe they need to protect the country’s National Health Service (NHS) from “privatization” at the hands of American corporations. But even as they do so, another controversy—about the ways in which Britain denies life-saving treatments to patients, solely on cost grounds—illustrates the problems with socialized medicine, which the left wants to export to the United States.

Concern about Trade Agreements

During a press conference in London Tuesday, a British reporter questioned Trump about a post-Brexit trade deal between the U.S. and Britain. The reporter specifically asked whether “the entire economy needs to be on the table” in those discussions, “including the NHS.” Trump responded that “everything with a trade deal is on the table.”

Those comments—which Trump later attempted to walk back—prompted outrage that Britain’s “beloved” NHS was at risk. British politicians across parties raised concern that American companies could receive NHS contracts (even though subsidiaries of U.S. corporations have already done so), or that a free trade agreement could supersede legislative efforts by Parliament to prohibit additional private contracting within the health service.

The Health Secretary, Matt Hancock—an announced candidate in the race to succeed Theresa May as Conservative Party leader and Prime Minister—epitomized the sentiments, claiming that “the NHS

NHS Denying Patients Care

The controversy continued at Prime Minister’s Questions in the House of Commons Wednesday. In that hourlong session, no fewer than five questions asked whether the NHS was “for sale,” or some variation thereof. But the sixth NHS-related question, by Labour MP Karl Turner, proved the most revealing:

Twelve months ago, the Prime Minister told this House that she wanted a speedy resolution to the funding row between NHS England and Vertex regarding the drug Orkambi to treat cystic fibrosis. My seven-year-old constituent Oliver Ward wrote to the Prime Minister recently asking what progress she has made. Could the Minister please give Oliver some good news and tell him that he need not get up every day worrying about this terrible injustice?

Turner’s question referred to Orkambi, a drug that could help thousands of British patients currently suffering from cystic fibrosis. But the NHS refuses to pay for the drug—not because it does not work, but because it does not meet cost thresholds that government bureaucrats have set.

Britain’s National Institute for Health and Clinical Excellence decided in 2016 that the NHS would not pay for Orkambi at the price set by its manufacturer. For the three years since, British patients have not found that decision very NICE at all.

A Precursor of an American Single-Payer System?

Unfortunately, however, liberals want to export the British model of rationing health care on cost grounds to the United States. Recall President Obama’s comments about the issue a decade ago:

The chronically ill and those toward the end of their lives are accounting for potentially 80 percent of the total health care bill out here….There is going to have to be a conversation that is guided by doctors, scientists, ethicists. And then there is going to have to be a very difficult democratic conversation that takes place.

Months after those comments, the New York Times ran an article, entitled “Why We Must Ration Health Care,” that argued for bringing a British-style rationing model to our shores.

This prevailing mentality among intellectual elites explains why neither the House nor Senate single-payer bills prohibit a government-run health plan from implementing cost-effectiveness research. In fact, the House bill explicitly provides for cost-effectiveness research as a method of determining drug prices, because most liberals believe that bureaucrats can and should have the power to restrict access to care on cost grounds. Most Americans, on the other hand, would strongly object to this rationing of care.

As for British politicians saying the NHS “isn’t for sale,” I could not care less—I wouldn’t want to buy it even if it were. The American health care system has its flaws, to be sure, but I have little interest in creating a system where government bureaucrats have near-total control over patients’ medical decisions, and use that power to deny access to life-saving care. I think most Americans would agree.

This post was originally published at The Federalist.

The CBO Report on Single Payer Isn’t the One We Deserve to See

On Wednesday, the Congressional Budget Office (CBO) released a 30-page report analyzing a single-payer health insurance plan. While the publication explained some policy considerations behind such a massive change to America’s health care market, it included precious few specifics about such a change—like what it would cost.

Sen. Bernie Sanders (I-VT), perhaps single payer’s biggest supporter, serves as the ranking member of the Senate Budget Committee. If he asked the budget scorekeepers to analyze his legislation in full to determine what it would cost, and how to go about paying for the spending, CBO would give it high-priority treatment.

But to the best of this observer’s knowledge, that hasn’t happened. Might that be because the senator does not want to know—or, more specifically, does not want the public to know—the dirty secrets behind his proposed health-care takeover?

Hypothetical Scenarios

The CBO report examined single payer as an academic policy exercise, running through various options for establishing and operating such a mechanism. In the span of roughly thirty pages, the report used the word “would” 245 times and “could” 209 times, outlining various hypothetical scenarios.

That said, CBO did highlight several potential implications of a single-payer system for both the demand and supply of care. For instance, “free” health care could lead to major increases in demand that the government system could not meet:

An expansion of insurance coverage under a single-payer system would increase the demand for care and put pressure on the available supply of care. People who are currently uninsured would receive coverage, and some people who are currently insured could receive additional benefits under the single-payer system, depending on its design. Whether the supply of providers would be adequate to meet the greater demand would depend on various components of the system, such as provider payment rates. If the number of providers was not sufficient to meet demand, patients might face increased wait times and reduced access to care.

The report noted that in the United Kingdom, a system of global budgets—a concept included in the House’s single-payer legislation—has led to massive strains on the health-care system. Because payments to hospitals have not kept up with inflation, hospitals have had to reduce the available supply of care, leading to annual “winter crises” within the National Health Service:

In England, the global budget is allocated to approximately 200 local organizations that are responsible for paying for health care. Since 2010, the global budget in England has grown by about 1 percent annually in real (inflation-adjusted) terms, compared with an average real growth of about 4 percent previously. The relatively slow growth in the global budget since 2010 has created severe financial strains on the health care system. Provider payment rates have been reduced, many providers have incurred financial deficits, and wait times for receiving care have increased.

While cutting payments to hospitals could cause pain in the short term, CBO noted that reducing reimbursement levels could also have consequences in the long term, dissuading people from taking up medicine to permanently reduce the capacity of America’s health-care market:

Changes in provider payment rates under the single-payer system could have longer-term effects on the supply of providers. If the average provider payment rate under a single-payer system was significantly lower than it currently is, fewer people might decide to enter the medical profession in the future. The number of hospitals and other health care facilities might also decline as a result of closures, and there might be less investment in new and existing facilities. That decline could lead to a shortage of providers, longer wait times, and changes in the quality of care, especially if patient demand increased substantially because many previously uninsured people received coverage and if previously insured people received more generous benefits.

That said, because the report did not analyze a specific legislative proposal, its proverbial “On the one hand, on the other hand” approach generates a distinctly muted tone.

Tax Increases Ahead

To give some perspective, the report spent a whopping two pages discussing “How Would a Single Payer System Be Financed?” (Seriously.) This raises the obvious question: If single-payer advocates think their bill would improve the lives of ordinary Americans, because the middle class would save so much money by not having to pay insurance premiums, wouldn’t they want the Congressional Budget Office to fully analyze how much money people would save?

During his Fox News town hall debate last month, Sanders claimed a large show of support from blue-collar residents of Bethlehem, Pennsylvania for single payer. The ostensible support might have something to do with Sanders’ claim during the town hall that “the overwhelming majority of people are going to end up paying less for health care because they’re not paying premiums, co-payments, and deductibles.”

Where have we heard that kind of rhetoric before? Oh yeah—I remember:

At least one analysis has already discounted the accuracy of Sanders’ claims about people paying less. In scrutinizing Sanders’ 2016 presidential campaign plan, Emory University economist Kenneth Thorpe concluded that the plan had a $10 trillion—yes, that’s $10 trillion—hole in its financing mechanism.

Filling that hole with tax increases meant that 71 percent of households would pay more under single payer than under the status quo, because taxes would have to go up by an average of 20 percentage points. Worse yet, 85 percent of Medicaid households—that is, people with the lowest incomes—would pay more, because a single-payer system would have to rely on regressive payroll taxes, which hit the poor hardest, to fund socialized medicine.

Put Up or Shut Up, Bernie

If Sanders really wants to prove the accuracy of his statement at the Fox News town hall, he should 1) ask CBO to score his bill, 2) release specific tax increases to pay for the spending in the bill, and 3) ask CBO to analyze the number of households that would pay more, and pay less, under the bill and all its funding mechanisms.

That said, I’m not holding my breath. A full, public, and honest accounting of single payer, and how to pay for it, would expose the game of three-card monty that underpins Sanders’ rhetoric. But conservatives should keep pushing for Sanders to request that score from CBO—better yet, they should request it themselves.

This post was originally published at The Federalist.

Single Payer Wouldn’t Make Health Care a “Right”

In talking about his single-payer bill, which he reintroduced in the Senate on Wednesday, Sen. Bernie Sanders often claims that “I want to end the international embarrassment of the United States of America being the only major country on earth that doesn’t guarantee health care to all people as a right and not a privilege.”

But his legislation would do no such thing. Understanding why demonstrates the inherent drawbacks of his government-centered approach to health policy.

In our own country, low reimbursement rates in many state Medicaid programs can make finding doctors difficult. One 2011 study found that two-thirds of specialist physicians would not accept Medicaid patients, whereas only 11 percent of patients with private insurance could not obtain appointments. Patients with Medicaid also had to wait an average of three weeks longer for an appointment for the few doctors who would see them.

Medicaid suffers from so many access problems that one former director of a state program called a Medicaid card a “hunting license,” because it “gave you a chance to go find a doctor.” That’s the only “guarantee” the Sanders bill actually provides—the guarantee you can try to go find care, not a guarantee you can receive it.

But “access to a waiting list is not access to care.” So ruled four Canadian justices in a landmark 2005 ruling, Chaoulli v. Quebec. In that case, Canada’s Supreme Court overturned Quebec’s ban on private health insurance, finding that it “interfere[d] with life and security,” because “the government is failing to deliver health care in a reasonable manner.”

Indeed, delays and long waits for care plague Canada’s single-payer health system. One study found that approximately 3 percent of the nation’s population remained on waiting lists for care in 2018. From physician referral to the start of treatment, waiting times averaged five months—double that for orthopedic surgery cases.

Government-run health care systems traditionally attempt to contain costs by limiting the available supply of care. Britain’s National Health Service (NHS) follows the same approach as Canada’s single payer system. So patients wait for care there, also.

Consider what happened just last year, when the winter flu outbreak created a national “crisis”: The NHS had to cancel tens of thousands of operations, emergency rooms resembled “Third World” conditions, and ambulances waited for hours to unload patients—because hospitals had no place to put them.

The language in Sanders’ legislation demonstrates how, instead of making health care a “right,” single payer would instead increase demand for care—demand the system could not fulfill. To add insult to injury, the Sanders bill would ban private health insurance—the same type of ban Canada’s Supreme Court struck down—here to the United States, giving patients little way out of a clogged government health system.

Promises aside, Sanders’ “guarantee” of coverage would quickly turn into a guarantee that patients would wait, and wait, for care. The American people deserve better.

This post was originally published at The Federalist.

Lowlights of Democrats’ New Single-Payer Bill

Some might think that, having embraced socialism and taking away the health coverage of millions of Americans, the Democratic Party couldn’t move further to the left. Think again.

House Democrats introduced their single-payer bill on Wednesday, and claimed that it’s a “significantly different” bill compared to versions introduced in prior Congresses. It definitely meets that definition—because, believe it or not, it’s gotten significantly worse.

What Remains

Abolition of Medicare—and Most Other Insurance Coverage: As I noted last year, the bill would still eliminate the current Medicare program, by prohibiting Title XVIII of the Social Security Act from paying for any service (Section 901(a)(1)(A)) and liquidating the current Medicare trust funds (Section 701(d)). Likewise, the bill would eliminate the existing insurance coverage of all but the 2.2 million who receive care from the Indian Health Service and the 9.3 million enrolled veterans receiving care from the Veterans Administration.

Taxpayer Funding of Abortion: As before, Section 701(b)(3) of the bill contains provisions prohibiting “any other provision of law…restricting the use of federal funds for any reproductive health service” from applying to the single-payer system. This language would put the single-payer system outside the scope of the Hyde Amendment, thereby permitting taxpayer funding for all abortions.

Lack of Accountability: As with the prior bill, the legislation would give massive amounts of power to bureaucrats within the Department of Health and Human Services (HHS). For instance, the legislation would establish new regional directors of the single-payer system—none of whom would be subject to Senate confirmation.

What Lawmakers Added

More Spending: Section 204 of the new bill federalizes the provision of long-term supports and services as part of the single-payer benefit package. Prior versions of the bill had retained those services as part of the Medicaid program, implemented by states with matching funds from the federal government.

In addition, the revised bill eliminated language in Section 202(b) of the Sanders legislation, which permitted co-payments for prescription drugs to encourage the use of generics. With the co-payments (capped at an annual maximum of $200 in the Sanders bill from last Congress) eliminated, the bill envisions the federal government providing all health services without cost-sharing. This change, coupled with the federalization of long-term supports and services, will result in increased spending—as more people demand “free” health care.

Faster Elimination of Private Coverage: Rather than envisioning a four-year transition to the single-payer system, the revised bill would eliminate all private health insurance within a two-year period. Over and above the myriad philosophical concerns associated with single-payer health care, this accelerated transition period raises obvious questions about whether the new system could get up and running so quickly. After all, Obamacare had an implementation period of nearly four years—yet healthcare.gov failed miserably during its initial launch phase.

In theory, moving away from a fee-for-service method of paying medical providers would eliminate their incentive to perform more procedures—a worthy goal. But in practice, global budgets could also lead to de facto rationing, as hospitals that exceed their budgets might have to stop providing care to patients—just as under-funding within Britain’s National Health Service (NHS) has led to chronic hospital overcrowding.

Compensation Caps: Section 611(b)(5) of the new bill would limit “compensation costs for any employee or any contractor or any subcontractor employee of an institutional provider receiving global budgets,” by applying existing pay restrictions on government contractors to hospitals and facilities in the single-payer program. These restrictions might lead some to wonder whether hospitals could truly be considered independent entities, or merely an arm of the state.

Effective Abolition of For-Profit Medicine: Section 614(a) of the revised bill states that “payments to providers…may not take into account…or be used by a provider for” marketing; “the profit or net revenue of the provider, or increasing the profit or net revenue of the provider;” any type of incentive payment—“including any value-based payment;” and political contributions prohibited by government contractors.

Liberals would argue that eliminating the profit motive will encourage doctors to provide better care, by focusing on patients rather than ways to enrich themselves. But the profit motive also encourages individuals to invest in health care—as opposed to other sectors of the economy—by allowing them to recover a return on their investment.

Effective Elimination of Patents: Section 616(c)(1) of the bill states that “if the manufacturer of a covered pharmaceutical, medical supply, medical technology, or medically necessary assistive equipment refuses to negotiation a reasonable price, the Secretary shall waive or void any government-granted exclusivities with respect to such drug or product,” and shall allow other companies to manufacture the product. By allowing the federal government to march in on a whim and seize a company’s intellectual property, the bill would discourage individuals from investing in such intellectual property in the first place.

“Reasonable” Prices and Rationing: As noted above, Section 616 of the bill requires HHS to determine when the prices of drugs and medical devices are “not reasonable,” by taking into account among other things “the therapeutic value of the drug or product, including cost-effectiveness and comparative effectiveness.” This provision could lead to the federal government denying patients access to drugs deemed too expensive, as occurs currently within Britain’s National Health Service.

This post was originally published at The Federalist.

Did Orrin Hatch Call the Wrong Party “Stupid” Over Obamacare?

Republican Sen. Orrin Hatch called Obamacare “the stupidest, dumbass bill” he’s ever seen at a recent American Enterprise Institute forum. “Some of you may have loved it,” he said. “And if you do, you are one of the stupidest, dumbass people I’ve ever met.”

Hatch ended up apologizing for his comment, but the question remains: If the chairman of the Senate Finance Committee considers Obamacare the “stupidest, dumbass” law on earth, then why on earth are his fellow Republicans so desperate to bail it out?

But of course, that approach would involve actually repealing Obamacare. And instead of solving the underlying problem, by repealing the regulations that led premiums to increase, Republicans want to throw money at the problem, giving insurance companies corporate welfare payments hand-over-fist in the hope that these efforts will mitigate ever-rising premiums.

This strategy does seem like a “dumbass” approach for several reasons. First, it does not repeal Obamacare. Numerous studies have demonstrated that Obamacare’s regulations have raised premiums. Occam’s Razor concludes that, if Congress wants to solve the problem of higher premiums, it should start by fixing the underlying reason for those higher premiums.

Second, this approach not only does not repeal Obamacare, it also entrenches it by making it the federal government’s business to “lower” health insurance premiums. The federal government has no more business dictating the price of health insurance than it does the price of homes, or food, or shoes. But by throwing more money at the Exchanges, Republicans will make it the business of the federal government — and federal taxpayers — to “lower” health insurance premiums.

President Trump hinted at the fundamental problems this approach brings last month, when he tweeted about protests in Britain over the National Health Service (NHS). One need only watch Prime Minister’s Questions to observe the ways in which Members of Parliament in Britain turn the NHS into a political tool. Most opposition parties pledge to “fix” the NHS by throwing more money at it. And last month, Jeremy Corbyn, head of the Labour Party and Leader of the Opposition, attacked the Conservative Government for “refusing to give our NHS the money it needs and needs now.”

If the federal government takes political responsibility for health insurance premiums, the “stability” fund would soon turn into a perpetual — and perpetually expanding — money pit. Even with a theoretical expiration date, Congress would face pressure to renew the fund, lest premiums increase if it lapses. And if premiums continue to rise, politicians would propose even greater corporate welfare payments, to “stabilize” the markets with yet more taxpayer dollars.

That scenario leads to the third problem, which Margaret Thatcher famously described four decades ago: Socialist governments traditionally do make a financial mess. They always run out of other people’s money.

That quote, coupled with our existing $20 trillion in federal debt, explains why, in their attempts to micro-manage the health insurance system from Washington, the Republican-Socialists who wish to bail out Obamacare have proposed much the same kind of “dumbass” policies as Hatch himself criticized.

This post was originally published at The Federalist.

Donald Berwick’s Rationed Transparency

Dr. Donald Berwick is back in the public eye. The former administrator of the Centers for Medicare and Medicaid Services (CMS) has announced he will run for governor in Massachusetts.

Berwick first entered the public spotlight in April 2010, when President Obama nominated him for the CMS post. But Berwick never went through the regular confirmation process. Instead, the president granted him a surprise recess appointment that July.

The president renominated him in January 2011, but it became apparent that he could not garner enough votes for Senate confirmation. That December, Berwick resigned. Now, he is pursuing office as an elected, rather than an appointed, official.

Berwick’s short tenure at CMS was defined by a series of controversial statements he made before his appointment. He defended both Britain’s National Health Service and government rationing of health care. Most famously, in a June 2009 interview, he stated that “the decision is not whether or not we will ration care — the decision is whether we will ration with our eyes open.”

After leaving CMS, Berwick said his comments were merely an attempt to argue for greater transparency in decision-making. “Someone, like your health-insurance company, is going to limit what you can get. That’s the way it’s set up,” he told the New York Times. “The government, unlike many private health-insurance plans, is working in the daylight,” he insisted. “That’s a strength.”

Unfortunately, Berwick himself, while head of CMS, went to great lengths to avoid transparency. He ducked reporters, in one instance even “exit[ing] behind a stage” to avoid press queries. Another time he went so far as to request a “security escort” to avoid questions.

Today, Berwick concedes his lack of transparency. According to a Politico report, he now “regrets listening to White House orders to avoid reaching out to congressional Republicans.”

The lack of transparency is endemic in the Obama administration. Case in point: the enactment of Obamacare. During his 2008 campaign, Barack Obama promised health-care negotiations televised on C-SPAN. Instead, we got a series of notorious backroom deals: the Cornhusker Kickback, the Louisiana Purchase, the Gator Aid.

“It’s an ugly process, and it looks like there are a bunch of backroom deals,” Obama feebly admitted in January 2010 — only to retreat again to the smoke-filled rooms two months later, where he cut the final deals to ram the legislation through Congress.

Obamacare is premised on the belief that government knows best. And those who share that belief all too often regard transparency and public accountability as inconveniences.

Consider the administration’s approach to regulating the proposed health-insurance “exchanges.” Obamacare requires state-based exchanges to “hold public meetings and input sessions,” but it fails to apply these same transparency standards to the federally run exchanges Washington will create in 33 states. The result: Many key questions remain unanswered.

Thus a law written in secret is being implemented in secret, with a maximum of opacity and a minimum of accountability from the administration.

This post was originally published at National Review.