Supreme Court Says Healthcare “Reform” Is Constitutional

The Supreme Court ruled that the healthcare “reform” law is Constitutional.  They did strike down one bit about expanding Medicaid, giving individual states the choice to opt-out and stay under the old system.

That is a common dirty trick that the Federal government uses.  Federal taxes are really high.  Some of that money is given back to the states, contingent on them also doing X.  That’s a subtle way that the Federal government usurps the power of individual states.  One example is “Pass a law that the drinking age is 21, or you lose all Federal highway money.”  Another example is Medicaid and the expansion of Medicaid.  States get a lot of money from the Federal government for Medicaid, but the states are also required to spend some of their own money on Medicaid.

I see absolutely no benefit from the healthcare “reform” law.  I’m currently in COBRA, and I got a letter from my insurer saying that my premium is going up 20% next year!  In 2008, my COBRA expired. (I had some jobs that didn’t provide health insurance.)  I bought an individual policy for $700/month.  I looked around now, and the cheapest individual policy is $1200/month!  So much for “This law reduces premiums!”

Also, an increase in premium of 20%-30% per year is close to true inflation.  Wages do not keep pace with real inflation, but premiums rise rapidly.

This law is fake reform and not real reform.  It’s a corporate welfare law.  Insurance corporations, drug corporations, and hospitals will make much more money under this law.

Real healthcare reform would eliminate the licensing cartel for doctors, or greatly increase the supply of doctor licenses.  All other reforms are smoke and mirrors, patching up a corrupt system.

A pro-State troll says “Licensing cartels protect customers!”  That is false.  The only people protected by a licensing cartel are the people who own the licenses.  They earn economic rent due to the licensing cartel.  Once a doctor gets a license, he has to really make a flagrant mistake to lose his license.  I was the victim of medical malpractice, but a malpractice lawsuit was infeasible.  I had to fire a bunch of doctors, before I found one that helped me.  I was not “protected” by the licensing cartel.

There was one amusing technicality.  When the law was being passed and debated, politicians said that the penalty for not owning health insurance is not a tax.  However, if you read the fine print of the law, it is a tax.  The Supreme Court ruled that it is a tax, and therefore legal.  The details of the words in the law are more important than the promises politicians made.  In other words, there’s no penalty for politicians lying, when they discuss a law.  If you lie to police or Congress, that’s a serious crime.  If a Congressman lies to you, that’s too bad.

The government “forces” people to own a home, by giving a tax deduction for owning a house and having a mortgage.  Similarly, the government can “force” you to own health insurance, by giving a tax deduction if you own health insurance.  However, with its taxation power, the government can force people to do anything, by taxing people who don’t do it.  The government can forbid people from doing something, by putting a high tax on it.  All taxation is theft.  The taxation power gives the State almost unlimited power.  It’s only limited by what people would see as obviously too evil.

The Republicans say they want to repeal the law.  That isn’t realistic.  They won’t have 60 votes in the Senate to overcome a Democratic filibuster.  There will be a horde of lobbyists looking to preserve this law.

The Republicans once swore that they would repeal Medicare and Medicaid.  Now, they are politically untouchable.

I see a psychiatrist and therapist for “mental health” treatment.  She said something interesting.  They make more money off of Medicaid patients than someone with regular insurance like me!  The Medicaid reimbursement rates are much higher than the rates for regular insurance!  Medicaid patients are a cash cow for the clinic!  They don’t make as much money off me.

Also, my insurance only allocates 20 visits per year, which means I run out in November.  I pay for 2-3 visits directly, with no reimbursement.  The fee they charged me for an “uninsured” visit is greater than the copayment+insurance payment!

This law is an example of “Problem!  Reaction!  Solution!”  The government causes a problem.  The media says “OMFG!  This is serious!  The government must do something!”  Then, another law is passed making the problem worse, while insiders make even more money.  This law will increase the economic rent earned by insurance corporations, drug corporations, and hospitals.

There were two problems the government caused.  First, the supply of doctors is artificially limited by the State licensing cartel, restricting supply and driving up prices.  Second, there was a law that said “Hospitals must treat all patients, even those broke and without insurance.”  This law was exploited by people who were poor.  They didn’t have health insurance, went to the emergency room when they got sick, and couldn’t pay because they were broke.  The “solution” to the problem law “Hospitals are forced to treat uninsured people!” is to force everyone to buy health insurance.  The government caused a problem, and then made things worse.

It is frustrating debating pro-State trolls, regarding “The government licensing cartel for doctors is evil.”  It’s basic economics.  If you restrict the supply with licensing and regulations, then the price increases.  Anyone who doesn’t understand that is lying, or is hopelessly brainwashed.

A pro-State troll says “It costs $2M to train a new doctor!”  That’s only true because the State has artificially raised the price.  Before the licensing cartel, a new doctor would work for an assistant for 2-3 years, before starting his own practice.  Besides, when you do see a doctor, the nurse usually does most of the work.

A pro-State troll says “I have a PhD in economics and you don’t.  I advise the government on healthcare issues.  The licensing cartel for doctors has nothing to do with high prices.”  Unfortunately, mainstream economics has nothing to do with reality.  It’s pro-State brainwashing, and not useful.  The only thing “useful” about getting brainwashed as an economist is that you can get a cushy job advising State leaders.  State leaders like to hire people who tell them that their stupid policies are brilliant.  A true independent thinker won’t fit in, when advising State parasites on economic policy.

A pro-State troll says “If all licensing cartels are evil, then some economics professor would say something!”  Almost all research funding comes from the State, leading to bias.  When all professors in a field have false beliefs, the “peer review” process becomes a censorship process.  If an economics PhD student wrote papers saying “Licensing cartels are evil!  The Federal Reserve is evil!”, then that would be a bad career move.  His papers would not be published, he would not get grand money, and he would not get a job.  If a PhD student started talking about honest ideas, the professors would tell him to abandon his crazy ideas, lest he ruin his career.  In this manner, the academic “peer review” process is one big censorship process.  When I dropped out of grad school, some other people lamented “The people who drop out are the ones who are the smartest and nicest!”

Economics professors are providing the illusion of research, hiding behind fancy Math calculations with false assumptions.  There’s no point doing fancy Math manipulations, when all your assumptions are wrong.  The mainstream economics industry is 100% propaganda, telling insiders what they want to hear.  When an economist says “There should be deficit spending to stimulate the economy!”, politicians answer “You want us to print money and give it to our friends!  Great!  We can do that!  You’re such a smart economist!”

The idea of health “insurance” is silly.  For real insurance, you are buying protection against disasters.  “Health insurance” covers routine medical expenses, making it not insurance, but something else.

As I mentioned above, you can wind up paying a doctor more if you pay cash, than if you have insurance.  Most insurance corporations negotiate discounts with doctors.  If you see a doctor and pay directly yourself, you can wind up paying more than the copayment+insurance fee.  When I was hospitalized, the insurance reimbursed ~$1000/day, but the “full retail price” if I was uninsured was $5000/day!  In effect, this forces everyone to own insurance, unless you’re broke and can default on the medical bill.

Modern health insurance started after WWII, due to the income tax.  As a way to give employees a tax-free perk, corporate employers started covering employee medical expenses.  Originally, it wasn’t clear this was legal, but the law was clarified and employer-paid medical insurance is a tax-free benefit.

This led to the practice of most people getting health insurance from their employers.  Since it was a tax-free benefit and a tax dodge, the health “insurance” covered everything, including routine medical expenses.

This tax loophole is biased against unemployed workers.  If my employer pays the $600/month insurance premium, it’s a pre-tax expense.  If I pay $600/month for COBRA, that’s $600 of after-tax money.  I have to earn $1000 to get $600 after taxes, making it much more expensive.

Health “insurance” is actually a socialist system of pooling costs.  It fails for the same reason that Communism and socialism fail.  There’s no incentive for anyone to try and keep expenses low, like there would be if you were paying with your own money rather than pooling it via “insurance”.

Health “insurance” is a great system for racking up huge expenses.  Suppose I have a close decision, whether to see a doctor or not.  If I had to pay the full $100-$200, I wouldn’t go unless it was necessary.  When my copayment is only $20, the incentive is for me to see the doctor, even if it isn’t necessary.

With health “insurance”, there’s no incentive for the patient to spend frugally.  He isn’t paying the cost.  The cost is spread out among all the policyholders.  It’s like eating out a restaurant where you agree to split the tab equally, no matter how much each person orders.  When you do that, someone will always get greedy and overspend.

Health “insurance” is a great system for maximizing expenses.  The cost is not paid by the patient, but indirectly by everyone else.  True insurance would only provide protection against disasters, and patients would pay for everything else directly themselves.

However, hospitals, insurance corporations, and drug corporations love the current system and the new “reform” law.  Hospitals no longer have to worry about getting stiffed by an uninsured patient   With a cartel monopoly, instead of lowering prices, they will instead make more money.  Insurance corporations typically have a profit model of “expenses plus 10% profit”, and the % profit rate is explicitly set in the new law.  There’s no incentive to keep expenses down, because more total expenses means more total profit!  Drug corporations love the new law.  The new law requires that many drugs must be covered.  That’s a cash cow for each corporation that sells a covered drug.

The biggest factor for expensive health care costs is the State licensing cartel for doctors.  Pro-State trolls will severely disagree on this issue.  They are wrong.  This “reform” law is fake reform.  It will lead to more profits for insiders, but not real reform.  Also, health “insurance” is not true insurance.  True insurance guards against disasters.  Insurance that covers routine expenses is not true insurance, but rather a type of socialism.

The debate over this “reform” law completely misses the point.  The real reason health care is expensive is the State licensing cartel for doctors.  Any other discussion is pro-State trolling and missing the point.  If you don’t understand “Licensing cartels are evil and drive up prices!”, then you don’t understand real economics.

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