Obama’s Logic on the Cost Curve is Bent, and so are his views on Young America

 

The final bill [will] make sure that people are getting the care they need and the checkups they need and the screenings they need before they get sick — which will save all of us money and reduce pressures on emergency rooms all across the country.

– President Barack Obama, December 15, 2009

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Don’t spend your beer money on insurance.

It sounds logical.  We’ve all heard stories, and the President has repeated them, about people who go to the ER to handle situations that could have been treated by a general physician.  Early treatment, the argument goes, reduces the cost of health care by reducing emergency room visits. What we need is a government solution to this problem.  But the problem here isn’t one caused by the health care industry, greedy hospital owners, or “the system.”  The problem is one created by the government. 


 
The Emergency Room scenario – when people who lack insurance visit the ER to deal with medical problems rather than seeing a family doctor –  is a result of federal law passed in 1986 which requires hospitals (those that receive Medicare funding, which is almost all of them) to treat patients in the emergency room regardless of ability to pay or citizenship status.  The fact that ER costs have increased since the law was passed shouldn’t come as any surprise.  From a mere accounting standpoint the law opened Emergency Room doors to people who previously wouldn’t have been able to afford the expense.  That shouldn’t be construed as an endorsement of a market system that turns away people who can’t pay.  It’s merely an observation that increased access will result in increased expenses.  When you mandate that hospitals provide emergency services for free, people will come. Continue reading