Monday, March 07, 2005

Father Knows Best?

Father Knows Best?

By Sandy Szwarc
Published 02/28/2005
TCS

If ever there was reason to reconsider the wisdom of having our healthcare and insurance under employment or government mandate, the "war on obesity" is it.

The surge of employer-based health insurance, which didn't happen in other insurance markets such as automobile and life insurance, and the creation of federal-based Medicare and Medicaid insurance in 1965, has contributed to skyrocketing medical costs and insurance rates for everyone, according to a just-released analysis by Robert B. Helms, director of health policy studies at the American Enterprise Institute. Receiving health insurance through employers removed the competitive marketplace which would have encouraged providers and insurance companies to keep costs down. It's also resulted in a plethora of untaxed health benefits, which at first glance seemed a good thing for recipients, and employers didn't mind since they could deduct benefits as a business expense. But it's also mostly benefited higher-income people with employer-provided perks, according to Helms, while meaning greater costs to our wallets, freedoms and choices.

Lawmakers have also played a significant role in raising costs of healthcare. State legislatures have passed more than 1,800 mandated health insurance "benefits," with 295 new mandates introduced in January of last year alone, according to a new report by the Council for Affordable Health Insurance. "For almost every health care product or service, there is someone who wants insurance to cover it so that those who sell the products and services get more business," they explain. Lawmakers justify their support by asserting that mandates won't cost much or that they'll save money, but "we have overwhelming evidence mandates virtually always cost money rather than save it," CAHI says. They estimate mandated benefits increase the cost for basic health insurance for all consumers by 20% to more than 50%, depending on the state. Worse, a number of these cost-raising, mandated covered treatments are frivolous, fraudulent or alternative -- unsound, ineffective, unproven or potentially dangerous.

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