Why Should Government Be Involved in Medicine at All?

If we want affordable and cutting-edge health care, there's only one approach that will work: open competition.

Any day now, the U.S. Supreme will rule on whether the Obamacare insurance mandate is constitutional. Seems like a no-brainer to me. How can forcing me to engage in commerce be constitutional?

But there's a deeper question: Why should government be involved in medicine at all?

Right before President Obama took office, the media got hysterical about health care. You heard the claims: America spends more than any country—$6,000 per person—yet we get less. Americans die younger than people in Japan and Western Europe. Millions of Americans lack health insurance and worry about paying for care.

I have the solution! said Obama. Bigger government will give us more choices and make health care cheaper and better. He proceeded to give us that. Bigger government, that is. The cheaper/better/more choices part—not so much.

Costs have risen. More choices? No, we have fewer choices. Many people lost coverage when companies left the market.

Because ObamaCare requires insurance companies to cover every child regardless of pre-existing conditions, WellPoint, Humana and Cigna got out of the child-only business. Principal Financial stopped offering health insurance altogether—1 million customers no longer have the choice to keep their insurance.

This is to be expected when governments control health care. Since state funding makes medical services seem free, demand increases. Governments deal with that by rationing. Advocates of government health care hate the word "rationing" because it forces them to face an ugly truth: Once you accept the idea that taxpayers pay, individual choice dies. Someone else decides what treatment you get, and when.

At least in America, we still have some choice. We can pay to get what we want. Under government health care, bureaucrats will decide how long we wait for our knee operation or cataract surgery … or if we get lifesaving treatment at all.

When someone else pays for your health care, that someone else also decides when to pull the plug. The reason can be found in Econ 101. Medical care doesn't grow on trees. It must be produced by human and physical capital, and those resources are limited. Politicians can't repeal supply and demand.

Call them "death panels" or not, a government that needs to cut costs will limit what it spends on health care, especially on people nearing the end of life. Medical "ethicists" have long lamented that too much money is spent in the last several months of life. Given the premise that it's government's job to pay, it's only natural that some bureaucrat will decide that 80-year-olds shouldn't get hip replacements.

True, surveys show that most Brits and Canadians like their free health care. But Dr. David Gratzer notes that most people surveyed aren't sick. Gratzer is a Canadian who also liked Canada's government health care—until he started treating patients.

More than a million Canadians say they can't find a family doctor. Some towns hold lotteries to determine who gets to see one. In Norwood, Ontario, my TV producer watched as the town clerk pulled four names out of a big box and then telephoned the lucky winners. "Congratulations! You get to see a doctor this month."

Think the wait in an American emergency room is bad? In Canada, the average wait is 23 hours. Sometimes they can't even get heart attack victims into the ICU.

That's where we're headed unless Obamacare is repealed. But that's not nearly enough. Contrary to what some Republicans say, we didn't have a free medical market before Obama came to power. We had a system that limited competition through occupational licensing, FDA rules and other government intrusions, while stimulating demand through tax-favored employer-based "insurance," Medicare and Medicaid.

If we want affordable and cutting-edge health care, there's only one approach that will work: open competition. That means eliminating both bureaucratic obstacles and corporate privileges. Only free markets can give us innovation at the lowest possible cost.

Of course, that also means consumers should spend their own money on health care, limiting insurance to catastrophic expenses. Americans don't want to hear it. But that's the truth.

John Stossel (read his Reason archive) is the host of Stossel, which airs Thursdays on the FOX Business Network at 9 pm ET and is rebroadcast on Saturdays and Sundays at 9pm & midnight ET. Go here for more info.