Fund healthcare by targeting the infirm and elderly!

Fund healthcare by targeting the infirm and elderly!

Posted on October 9th, 2009 by David "Preacher" Slocum

The latest iteration of the proposed healthcare bill, the one being championed by Montana Senator Seiman Baucus (recipient of over $4 million in healthcare lobbyists’ money), ignores the President’s promise that he would not levy taxes on those who were not rich. It also ignores the promise the President made to negotiate the healthcare changes on C-Span but since he ignored the promise to make his campaign financing transparent, we really didn’t expect him to keep his word.

Part of the Baucus plan is to create new taxes for medical devices based on the three categories created by the FDA. The categories break down medical devices into those that present minimal potential for harm to the user (Class I), those for which general controls alone are insufficient to assure safety and effectiveness (Class II) and devices where insufficient information exists to assure safety and effectiveness solely through the general or special controls (Class III). Never mind that the products are placed in categories with little or no relation to reality (female condoms are Class III while male condoms are Class II, though I would be hard pressed to see how a condom presents enough of a “potential harm” to the user to be classified even as Class I), the latest version of the bill ruled that items classified as Class II that also cost more than $100 would be taxed as would all items in the Class III category.

These items include powered breast pumps; tests for HIV; pacemakers; ventilators; X-ray machines; powered wheelchairs; hip, knee, ankle and breast prosthetics; dentures; and many types of dialysis catheters. The manufacturers of these items, having to pay these new taxes, will be forced to raise the price of these items and the hospitals will have to pass that price increase on to the patients or, in most cases, to the healthcare entity that is paying the bill.

One way to stop this from happening is for Congressional leasers to include language in the bill to fix prices at an artificially lower price. Economics 101 tells anyone who cares to look that price fixing is never a good idea since it destroys any real competition among manufacturers, drives the marginal companies out of business and stifles innovation.

Another, more likely, way is set price limits that the government will pay for services and equipment and force healthcare providers to accept the govermnent-backed insurance (ala Medicare writ large). This will, in turn, force the hospitals and clinics to pass the cost on to those who have private health insurance, just to survive. Smaller companies won’t be able to afford to insure their employees and will drop healthcare plans, forcing consumers to adopt the government plan as the only fiscally responsible choice. This cascading cause and effect chain will create an atmosphere where only the richest Americans can afford private healthcare plans and, in effect, make the previous option of fixed prices a general reality.

You can just imagine what it will do to the quality of healthcare as hospitals struggle to survive when all of their funding is dependent on a government stipend.

Even if the chicken little scenario I have foreseen does not come to pass, what we have in this bill is a tax, intended to fund affordable healthcare, that is targeted at the most vulnerable portion of society; the new mothers, the aged and the infirm.

Well done, Senator!