Grading the Health Care Summit
Economist Arnold Kling is on the job:
The Democrats get a D+ because they supported a Medicare cost-cutting commission. That might lead to health care rationing, which would reduce costs. Not the way that I would prefer, but it would reduce costs….
On insurance reform, I give the Democrats an F because of their top-down, paternalistic approach. President Obama pretty much flat-out said that catastrophic insurance is bad insurance and needs to be regulated out of existence. In contrast, he called comprehensive insurance "good insurance," when it is not really insurance at all, but instead is a pre-paid service plan.
The Republicans get a D, because they showed scarcely any more trust in free markets than the Democrats. For example, one way they want to reform insurance is to get rid of lifetime caps. That is, an insurance company will say that no matter what happens to you, they will not pay more than, say, $5 million over the course of your life. This is an absurd, oxymoronic thing for an insurance company to do. You are asking me to insure the insurance company, instead of the other way around. Still, the government does not have to ban the practice. Instead, require prominent disclosure, and let people choose….
On the long-term outlook, the Republicans get an F, because they are still being demagogic on Medicare cuts. The Democrats get an F-, because they want to use Medicare cuts to create a new entitlement. Also, President Obama repeated the talking point that the whole issue is excess health care cost growth, when in fact the excess cost growth really kicks in big time (under standard assumptions) after 2030, by which point the U.S. government will already be unable to keep its financial promises because of the doubling of the number of people over age 65 and the big debt we already have.
Matt Welch on the summit from earlier today.
