Who are the uninsured?

By Vin Suprynowicz
web posted October 1998

Collectivist schemes under which the federal government would complete its regulatory takeover of the nation's health care industry -- either all at once, or on the installment plan -- keep rising from the dead.

Therefore, we can expect to keep hearing those old Hillarycare statistics, contending that as many as 30 percent of Americans are without health insurance, and thus face immediate bankruptcy should a serious illness strike.

Yes, some Americans do fail to maintain health insurance policies -- just as some Americans fail to eat good diets, or to work the necessary hours to pay their rent.

But preliminary data gathered by the Center for Business and Economic Research at the University of Nevada, Las Vegas indicate that only about 8.7 percent of Nevada's 1.8 million residents go without health insurance coverage for periods of a year or more, while another 10 percent may go without insurance coverage during part of the year, presumably while they're changing jobs.

Those figures (and those without coverage in Nevada slightly exceed the number nationwide) are a far cry from three-in-10. And many who are "without insurance" obviously remedy the problem by simply finding work.

The main reasons cited for respondents' failure to carry such insurance were high cost, or the failure of employers to offer such plans, the UNLV researchers announced last month. That would seem to track with the fact that the unemployed had the lowest rate of insurance coverage (at only 44 percent), while healthy young adults -- not children or the elderly -- are the most likely to suffer short-term coverage lapses.

(Senior citizens are actually the best-covered group.)

Employers first used the offer of a company-paid (or part-paid) group health insurance policy as an incentive to attract scarce workers during World War II -- thus bypassing official federal wage controls. When federal tax agents ruled that such benefits could be deducted as a business expense by the employer (whereas individuals who buy their own health insurance must do so with after-tax dollars, only qualifying for some deductions after premiums exceed 7.5 percent of income), that ruling had the effect of cementing in place the otherwise artificial linkage between employment and health coverage.

Thus, many of the perceived problems with America's health insurance system stem from federal attempts to meddle in the free market, in the first place. The irony should be palpable, as the fans of Big Brother now assure us that the solution is to have Auntie Sam decide who our doctor should be, what treatments he may offer, and how much they should cost.

(The collectivists likewise controlled the price of chicken in Moscow for 70 years, in order to guarantee it would remain "affordable." Given that farmers thus had no profit incentive to supply the market, the running joke in Moscow was "Yes, the government guarantees that chicken must be affordable ... if only there was any chicken!")

True, American health care often seems less affordable these days. But the causes - high malpractice rates in a litigious environment, and the refusal of Medicare payers and others to pay full amounts billed, which can force a transfer of costs -- are not likely to answer well to continued centralization. In fact, such steps are only likely to drive the best doctors out of the profession -- as every other nation to adopt socialized medicine has already proved.

If some gaps need to be filled in, allowing private contracts which set a higher threshold for malpractice suits in exchange for lower rates might be worth a look. Congress could also offer the same tax deduction to private purchasers of health insurance as is enjoyed by large employers. Or, the whole industry could be further divorced from protectionist schemes of government licensing and regulation, allowing a competitive free market in medicine to thrive for the first time in 80 years.

In the meantime, do Nevadans face a "health care crisis"?

The indigent, of course, generally receive free treatment in the state's emergency rooms.

At the other end of the scale, some of those who opt to carry no health insurance are wealthy enough to pay cash for their medical needs as they arise. While others still could afford the premiums, but have decided to spend their money on other priorities -- bad decision-making which should not be rewarded by bureaucrats, funding their misplaced "compassion" by looting the pockets of those who sacrifice and save to care for their own.

The current system isn't perfect. But if what's really needed is some more charity to pay for the health care of kids without insurance, why not try just that -- encouraging private charity -- before we attach more lifetime state or federal bureaucratic leeches to our economic jugular?

Vin Suprynowicz is the assistant editorial page editor of the Las Vegas Review-Journal. Readers may contact him via e-mail at vin@lvrj.com. The column is syndicated in the United States and Canada via Mountain Media Syndications, P.O. Box 4422, Las Vegas Nev. 89127.