No price controls
The latest gambit to increase government control of your life comes under the guise that private health insurance companies have been making "excessive" profits, taking advantage of their privileged economic positions. Acting like a shill for the administration, "Health Care for America Now" writes, "Simply put, the private insurance companies have secured monopolies or tight oligopolies and exercised that power to put profits ahead of patients."
What might have established the so-called monopoly and oligopoly? Why, government, of course. New York State has an impressive government regulatory structure that specifies what must be covered by your insurance policy. By law, you are restricted from shopping elsewhere for coverage. Your premiums reflect unfunded mandates dictated by the state legislature and Congress. It makes no sense to increase the power of government to restrict competition further if it is competition that helps hold down profits.
By the way, just how obscene are those profits? Economist Mark J. Perry, at the Carpe Diem blog listing of Profit Margins by Industry, shows the Health Care Plan Industry ranks #86 by profit margin (profits/revenue) at 3.3 percent and the hospital industry ranks #77 at 3.6 percent — much lower than the 25.6 percent profit margin for beer brewers. Yet the administration is not beating the drums to hold down brewery profits or to take over the industry to create Government Beer.
The administration has yet again failed to accurately put into context the facts so that ordinary people could judge for themselves what might be a sensible approach. The absence of accurate price signals upsets the market and leads to rationing service. It makes no sense to reach back to the days of Richard Nixon and Jimmy Carter to reinstitute price controls that never worked and never will.
You don’t hear the administration explaining that centrally planned economies are inefficient, decrease competition, and provide too many opportunities for collusion. You don’t here them offering sensible change like tort reform. Nope. They just want to make health care "more fair."
When someone calls for something to be made "more fair" it signals that it’s time to grab your wallet, count your change, and keep your eyes peeled. Whenever A proposes to help B and only C will have to pay, A is fishing for control. They propose free healthcare. Someone else will have to pay. Not you.
Dear government, your answer to every problem seems to be to put you in charge. It ain’t gonna happen.