CANNON: Avoiding health-care chaos

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By Michael Cannon

COMMENTARY:

To hear the media tell it, comprehensive health care reform is a done deal. Democrats control both ends of Pennsylvania Avenue. Business, labor and the insurance industry are on board. The lion has lain down with the lamb.

In reality, reform could crater for the same reasons it did in 1994: The leading Democratic plans include radical changes that would tax and disrupt the health care of millions. With a minimum price tag of $120 billion, universal health insurance coverage will require taxing the middle class during a recession, further expanding a $1 trillion deficit, or having the government deny medical care to patients. An estimated 30 million Americans would lose their current coverage under Barack Obama's plan. Millions could lose established relationships with their doctors.

Today's love-fest will quickly descend into a bloodbath once the lions make their intentions clear.

The carnage would mount over time. The leading plans would cost lives by effectively nationalizing health insurance and impeding innovations that make medicine better, cheaper and safer.

Republicans, centrist Democrats, and independents must protect Americans from the worst elements of those proposals. That means drawing three lines in the sand. Any proposal that crosses one of the following lines should be stopped. Not watered down. Not enacted and fixed later. Killed.

(1) No government-run health care for the middle class.

Echoing the Left's rallying cry of "Medicare for all," Mr. Obama proposes a Medicare-like option for everyone under age 65. Others endorse variants on that theme.

Medicare is an unwise model for reform. When private health plans and providers try to meet the glaring need for electronic medical records, coordinated care, and medical-error reduction, Medicare's change-resistant payment system punishes them for doing so. That discourages innovation and costs lives.

The average family of four pays $5,200 in taxes to fund Medicare, only to have Medicare waste one third of it (about $1,700) on services that do nothing to make seniors healthier or happier. That's a pure income transfer to providers of $150 billion - roughly the entire economic output of South Carolina. Diverting those resources from more productive uses, such as covering the uninsured, costs lives.