Civitas Review

SChip Blues – Part I

By | Posted in Healthcare |

State budgets are already being swallowed up by Medicaid budgets.  And yet our liberal counterparts over at NC policy watch are eager to see SChip expanded in N.C. You'd think they would want to hide the part about subsidies for children of families at 300 percent ($62,000) of poverty. Nope. Adam Searing writes glowingly of the proposal. But then again, the 'progressive' answer to everything is to increase funding and bureaucracy. How creative. But I digress…

Let's overlook, for the moment, the bill of goods Adam has been sold about the price of covering all NC children. Let's also overlook the fact that you pay higher federal taxes to subsidize $2 to $3 per $1 in matching funds of Medicaid money N.C. spends — which is why our bureaucrats are eager to spend it. (I'll update later on actual stats of costs to the Medicaid system.) … But here's what's actually going on, and in the process feeding into the ultimate progressive agenda of universal healthcare:

1. North Carolinians are troubled by the cost of insurance premiums.  Few understand that the prices are high because regulators force us to buy our policies with things we don't need packaged in them (I'm a 33 year old male. I don't need in vitro fertilization, but I have to pay for it).  These are called mandates.  Consider these examples of cost increases from the NCPA (not all necessarily mandated in NC yet, but in other states):

– Drug abuse treatment, 1 percent.
– Hair prosthesis, 1 percent.
– In vitro fertilization, 3 percent to 5 percent.
– Acupuncturists, 1 percent to 3 percent.
– Massage therapists, 1 percent.

They're devastating to ordinary people trying to get covered for real conditions. Of course, big companies like Blue Cross/Blue Shield of N.C. are happy to include these things. They navigate these regulatory waters very well and benefit from a virtual monopoly condition created by this state-controlled market environment. So, they'll actually fight to protect these mandates — just as the insurance commissioner will fight to protect his regulatory power that keeps you buying insurance in the Old North State. Doctors and hospitals benefit, too — after all, they just ding insurance or Medicaid as needed, and you leave the shopping to them. A tacit collusion continues unabated, but many North Carolinians can still scarcely afford insurance (and their insurance commissioners still say they can't buy cheaper insurance out of state in places like Virginia, with fewer mandates).

2. Since premiums are so high, politicians can then come along and promise to subsidize or cover families (especially children — who wouldn't want to cover children?) using Medicaid, even though people could afford it themselves were it not for the very regulatory environment our state government has created (nevermind that Medicaid costs are about to send budgets over a cliff in many states — N.C. included). 

3. Eventually, this step-by-step process of squeezing from the top (Medicare expansion, e.g. Part-D), squeezing from the sides (mandate-riddled premium increases); and squeezing from below (SChip expansion) is the means by which bureaucrats can come along later and say: "why shouldn't we just cover everyone?"  This is how a single-payer system will be born (read: socialized medicine like that found in Canada, where people wait months to mend a broken leg).

Anyway, don't be fooled either by politicians or progressives promising good things via the government provision of goods or services. And don't believe the hype about bureaucrats "helping" people pay for their healthcare.  And certainly don't believe it'll be "free." Ever wonder why our roads are so bad in North Carolina? Check out our Medicaid tab.  –Max Borders

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