"Before the federal government intruded into health care in the 1960s, health care cost a fraction of today's prices, hospital stays didn't cost a year's wages, health insurance was a lot less expensive and accessible to virtually everyone on some basis, and doctors even made house calls."

"It isn't enough merely to oppose the Clinton health-care makeover or the Republicans' piecemeal enactment of it. We need to get the federal government out of all areas of the health-care industry. That would lower dramatically the cost of your health insurance, make it easier for your doctor to take care of you, and reduce dramatically the cost of a hospital stay."

Restoring Good Health Care

Health care gives the politicians the opportunity to create a problem, and then use that problem as justification to interfere still further in health care.

There was a time in America when your doctor knew you and could easily remember your specific medical situation, when a hospital stay wouldn't bankrupt you, when low-cost health insurance was available to virtually everyone -- even those with pre-existing conditions. For those in need, there were doctors who provided free or low-cost care, and there were free clinics and charity hospitals. No one was deprived of adequate health care.

Today that efficient, benevolent care exists only in the imaginations and promises of politicians. And yet Americans took these things for granted just a few decades ago -- before government moved into our medical lives, supposedly to make things better.
No political reform will ever achieve the kind of care the politicians keep promising, because you can't organize health care by force and expect people to function as they did when they worked together voluntarily.

Today half of all health-care dollars in America are spent by governments -- not insurance companies, employers, or individuals, but by governments. If there is a crisis in health care -- and there certainly is -- the government, not the free market, is responsible for it.

If we want good health care, the answer is very simple: get the government out of it.

How Health Care Became So Expensive

Health care has skyrocketed in cost because government subsidies push up the demand for medical services, while government regulations chase medical suppliers out of the market.

There are five main routes through which the federal government affects medical costs:

1. The federal income tax code -- which allows employers to deduct employee health costs from the employers' taxable income, but doesn't allow employees and self-employed individuals to deduct much of their costs.

2. Laws that force health insurance companies to cover various treatments.

3. Medicare -- a program to provide health insurance for senior citizens.

4. Medicaid -- a program to provide medical services primarily for the poor.

5. General regulations on doctors, hospitals, insurance companies, and pharmaceutical manufacturers.

The Tax Code

When the wage controls ended, the health insurance remained. The tax code allowed employers to deduct these costs, and they became a way to attract better employees. The tax code is constantly changing, but individuals have never been able to deduct all their medical expenses or all of the cost of health insurance. So it has made sense for employers to pay these expenses in place of higher wages on which employees would have to pay income tax.

Insurance is meant for extraordinary circumstances. You don't use car insurance to pay for oil changes or gasoline; you have it as protection in case you have a terrible accident or your car is stolen. You don't use homeowners' insurance to pay your electricity and water bills; you have it as protection in case a fire or other catastrophic event produces a large expense.

Obviously, any insurance policy that promises to cover every small, ordinary expense is going to be much more expensive than one that covers only extraordinary expenses.

The competition for employees has inspired employers to offer better and better health-care coverage. This has led to coverage that has become less like traditional insurance, and more like a free health-care service paying all your medical bills -- big and small. This has not only made coverage more expensive for employers, it has induced employees to take advantage of what seems to be free health care -- putting greater demands on health-care providers. That runs up the price for everyone.

When we repeal the income tax, there will no longer be an incentive for employers to furnish health care. Instead, they'll be free to compensate employees in a more appropriate way -- especially through higher wages. And you'll be able to purchase relatively inexpensive insurance that will pay for extraordinary expenses -- such as those connected with a bad accident or a life-threatening disease. Routine doctor visits will be much less expensive (because people paying for their own ordinary expenses will use doctors' services less frivolously) and you can handle them out-of-pocket -- just as you now pay for gasoline for your car or utility bills for your house.

Until the income tax is repealed, all medical expenses should be fully deductible -- whether you pay for them directly or through your employer. But don't hold your breath waiting for Republican and Democratic politicians to make the tax code fairer.

Health Insurance You Can't Afford

Health insurance has become progressively more expensive and thus less accessible for many people.

Governments force your insurance company to load up your health-care policy with benefits you don't need, but that the company has to include in the price of your premium.

Politicians love to posture as friends of women, children, and various special interest groups by complaining that health insurers should include in their policies some medical procedure that isn't normally covered. But every time the government (state or federal) forces insurers to include another benefit in your policy, the company has to raise your premium. Not surprisingly, the cost of health insurance has risen spectacularly over the past quarter-century.

Depending on the state you live in, your insurance company may be pricing your policy to allow for psychiatric coverage, chiropractors, abortions, drug abuse, alcoholism, treatments to stop smoking, cosmetic surgery, treatment for obesity, Christian Science practitioners, and dozens of other possibilities. I have nothing against any of these treatments. But it makes no sense for you to be paying for such coverage if there's no chance you'll ever use it.

For example, a priest buying health insurance may live in a state that requires that abortions be included in every policy, and he must pay accordingly.

You should be able to buy a policy that requires you to pay only for what you need and want -- not what the politicians think you need.

The alternative we have now makes insurance constantly more expensive. And as it becomes more expensive, each medical interest group suffers -- leading it to go to Washington (or the state capital) to lobby the politicians to provide relief by forcing insurers to include its treatment in all policies.

The worst sufferers are young people in their 20s and 30s. Generally, they belong to no special interest group, and as insurance becomes progressively more expensive, more and more young people decide to risk going without insurance.

The graph below shows that health insurance was growing in popularity until the politicians in the 1970s began imposing mandates on the insurers. Since then, premium costs have been spiraling, and fewer and fewer people can afford coverage.

Just between 1990 and 1996, the number of insured people decreased by about one sixth. And the largest block of uninsured is in the 18-35 age group.

The rising costs have caused many employers to drop health coverage as well. In 1980 fully 97% of the employees in companies of 100 or more employees had medical coverage. By 1995, only 77% were covered.

This, of course, gives the politicians more ammunition to propose more programs to force more benefits into insurance policies, causing the price of insurance and managed care to go still higher.

This is another reason to get the federal government completely out of health care, and to hope that your state government will also keep its hands off your medical care.

How HMOs Became So Powerful

In 1999 many politicians pushed for a "Patients' Bill of Rights," to give patients certain privileges when dealing with Health Maintenance Organizations (HMOs).

No one was pushing for a "Bill of Rights" to protect patients against doctors -- or against druggists, appliance stores, computer makers, or gardeners. So how did HMOs become so powerful that consumers needed protection against them?

Because in 1973 Congress passed the HMO Act -- which subsidized HMOs and forced any company providing employee health insurance to offer an HMO as an option. This requirement was finally repealed in 1995, but by that time the special advantages had made HMOs the dominant element in employer-offered health insurance.

Once again, the politicians postured over the opportunity to rescue us from a problem they had caused.

Medicare

Medical costs began skyrocketing with the advent of Medicare and Medicaid in 1965. By offering all kinds of additional medical services to people, without their having to pay for them out of pocket, these programs increased the demand for medical services while the supply continued to be limited by regulations. The result, not surprisingly, was dramatically higher prices.

Medicare is so complicated, no one person could possibly explain the complete system to you. The rules, guidelines, and instructions cover 111,000 pages. And whenever you hear that Congress has reformed the system to make it easier to deal with, to eliminate waste and corruption, or to provide more choice, you can assume that it has become even more complicated.

Medicare has overloaded doctors with regulations, forced them to undercharge for their services, and driven many of them out of the medical profession entirely.
Some doctors have remained in the profession but have resigned completely from the Medicare and Medicaid systems -- refusing to perform any service that will be paid by Medicare or Medicaid. As a result, they are able to reduce their fees to patients by half or more. This is an indication of how much Medicare has run up the cost of your health care -- whether or not you're in Medicare.

But it isn't just doctors who have been hurt by Medicare. If you're a senior citizen locked into Medicare, you have my sympathy:

• Medicare routinely turns down roughly 20% of all the procedures physicians decide are needed.

• If Medicare denies your hospital claim, it can take as long as a year for your appeal to be processed.

• If Medicare refuses your request for a particular test or treatment, even one your doctor thinks is essential, you can't pay your doctor directly for it. If the doctor were to accept your money, he would be expelled from Medicare and lose all his other Medicare patients for two years thereafter.

• Because Medicare regulations are so extensive, ignorance of the law could easily get you or your doctor in legal trouble for doing something that's against the law. Penalties for mistakes include fines and imprisonment.

• You most likely pay at least twice as much for health care as seniors did before Medicare -- even after allowing for Medicare's contribution and after adjusting for inflation.

You will be much healthier and spend less money on health care once we get government out of Medicare and all other areas of the health-care system. You'll be able to get private insurance that is tailored to your specific needs and isn't made expensive by government mandates. Government programs will no longer run up the price of medical care. And doctors will be free to treat whatever ails you.

Medicaid

Medicaid is a federally sponsored program by which state governments provide health-care services to people below a specified income level and to nursing homes for the elderly. Each state provides an appropriate local name for the program and sets up the rules. However, 50-75% of the money for the program comes through the federal government, which doles it out according to formulas set by Congress.

With the majority of the cost being covered by the federal government, the states have an incentive to take all the money they can get and then raise the balance of the money through state taxes. Thus the program is as generous as possible and generates more upward price pressure on the health-care system.

But like so many federal-aid programs, Medicaid is an invitation to waste and corruption. The state programs are continually under fire for exceeding their budgets. In 1994, for example, Oregon instituted strict rationing of health-care services in order to bring medical costs under control. And in Tennessee, the Republican governor in 1999 cited out-of-control Medicaid costs as his excuse for breaking his word and proposing the state's first income tax.

Before the government stepped in, poor people found solace with charity hospitals, free clinics, and country doctors who knew and cared for their patients. One way or another, there was always medical care for those who needed it urgently. Some people didn't like that system. So now we have one that chews up money like Pac-Man eating a video screen.

General Regulations

Although it would seem that the total cost to you of Medicare and Medicaid combined is what you pay in taxes, that isn't the case.

Most doctors, clinics, and hospitals are able to bill the government for only a percentage of what they would normally charge a patient -- sometimes as little as 25% to 50% of a normal bill. In order to stay in business, they have to make up the difference by overcharging their paying customers -- including you.

And that's just the beginning of the cost problem. The federal and state governments have imposed all sorts of regulations on doctors, hospitals, insurance companies, managed-care providers, and other elements of the health-care industry.

For example, hospitals are forced to admit anyone who shows up at the door, with or without the price of admission. And hospitals and doctors fill out endless forms to comply with federal regulations, to justify Medicare and Medicaid bills, and to prove that they aren't discriminating. Who pays for all the free services and for the time involved in complying with federal regulations? You do, of course; it's in the bill you receive from your doctor, hospital, or insurance company.

The "Medicare + Choice" bill in 1997 included demands that managed-care providers add more services without being compensated for them. This pushed so many providers into a loss position that over a hundred of them chose to leave the Medicare system entirely -- making over 400,000 senior citizens search for new plans. The result has been less choice for the elderly, not more.

All the regulations add to the cost of your health care. And they are all so unnecessary. America had the best medical system in the world before the politicians got their greedy hands on it.

No one has ever been denied health care in America if in urgent need and if any doctor was aware of the person's problem. But good works aren't good enough for politicians.

The Two-Party Destruction

Both parties campaign on the health-care issue. Each claims to have your interests at heart.

The Democrats: Equal Waiting Lines For Everyone

The Democrats keep pushing for a "universal health care" system. But such a system is an impossibility. There aren't enough resources in the world to meet every health-care need of every citizen. Choices will always have to be made, and it is far better for you to make your own choices based on the cost of services than to let politicians decide on the basis of political influence whether or not you'll be treated.

There's a reason so many Canadians cross the border into America to get operations or other medical treatments. Canada has "universal health care" with "free" medical care. Not surprisingly, when patients don't have to consider the cost of anything, they deny themselves nothing that might improve their health.

So the waiting lines are overwhelming. And an emergency doesn't necessarily put you at the head of a line. People needing such operations as open-heart surgery sometimes wait as long as five years.

Even emergency rooms at hospitals in Toronto have turned away ambulances because neither the staff nor the space was available to accommodate the patients. Throughout Canada, there are hospital hallways crowded with patients on beds or stretchers overflowing from filled rooms. A vice-president at Vancouver General Hospital estimated that 20% of heart-attack patients who should have treatment within 15 minutes now wait at least an hour.

Consequently, doctors and hospitals routinely refer patients to facilities in America.

The Canadian system isn't unusual. It is commonplace in Europe -- as are the waiting lines. Unfortunately for Europeans, there are no American facilities nearby.

The contrast between government-run and private health-care systems is stark. In Canada, for example, dentistry and veterinary care are still privately run. Thus you can get treatment for a cavity faster than for cancer, and your dog gets better medical care than you do.

This is what the Democrats hold up as the model enjoyed in more "enlightened" countries -- the model of what they want to bring to you and every American.

The Republicans: Death By Degrees

The Republicans take a different approach. They claim credit for having stopped Hillary Clinton's 1994 attempt to impose universal health care in one giant step, and they pose as the defenders of private health care.

But the difference between the two parties' health-care positions concerns only the speed at which they want to take you to Hell on a hospital gurney.

The Republicans keep claiming that no massive overhaul of the health-care system is necessary -- that only a few small changes are required. They cite such needs as to make health insurance portable (so that you can transfer it if you change employers), to cover people with pre-existing conditions, and to enhance the coverage provided by insurers -- in other words, remedies that wouldn't be necessary if the government hadn't stuck its nose into health care in the first place.

In recent years these "needs" have led to the Kennedy-Kassenbaum bill, the Hatch-Kennedy bill, and the "Medicare + Choice" act. These and other bills have burrowed government more deeply into your health, your insurance, and your medical treatment. The Republicans have imposed more and more mandates on the insurance companies -- leading to the eventual destruction of the private insurance industry.

The Republicans have helped make the health care system so expensive and so inaccessible that people who don't understand how this happened can easily fall for the lure of government-run universal heath care. Once again, the politicians have created new problems that provide new excuses for politicians to impose new solutions.

So what is the difference between the politicians of the two parties? One party runs a little faster, but they're both heading for the same destination.

Libertarians are the only political party working to get the government completely out of health care -- so you and your family can have low-cost health insurance, a doctor whose waiting room doesn't resemble Grand Central Station, and a hospital stay that doesn't cost a year's pay.

Health Care You Can Truly Afford

America had the best health-care system possible until the federal government moved into the field in the 1960s. Medical care cost a fraction of today's prices, a hospital stay didn't eat up a year's income, health insurance was a lot less expensive and a lot more accessible, and doctors made house calls.

The Great Libertarian Offer will bring back that system. Combined with the technological advances of the past two decades, America will have the best health-care system imaginable.