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Volume 62, No. 5 May 2006


Massachusetts has achieved the impossible. The Health Reform Bill, which passed by 154-2 in the House and 37-0 in the Senate, "does what health experts say no other state has yet been able to do" (Pam Belluck NY Times 4/5/06).

Republican Governor Mitt Romney outsmarted the Democrats to get "95% of what I proposed." The "landmark" achievement provides insurance for all "without raising taxes and without a government takeover." The compromise should inspire other states, said Paul Ginsburg (ibid.).

Applauding the bill are the Massachusetts Medical Society, the Coalition for Social Justice, Families USA, Health Care for All, Sen. Edward Kennedy and the Heritage Foundation.

The goals are represented by some numbers, writes Arnold Kling (Wall St J 4/7/06): Affordability (the $295 per worker penalty for employers who don't offer coverage); insulation from costs ($0 deductibles, copayments, and premiums for the poor); and access (the $6,000 average annual expenditure on medical care for a Massachusetts resident). Problem solved: providing only that you "abolish the laws of arithmetic."

The Connector

The wedge that is supposed to open Massachusetts to the free market, the Connector is like a stock exchange or a giant car dealership, writes Edmund Haislmaier of Heritage. It has also been compared to the Federal Employee Health Benefits Program (FEHBP). Its "single administrative structure" helps to rationalize the "fragmented, balkanized health-insurance market." This Heritage-authored idea is a "marketplace" not a "sop to socialism," he insists ( nationalreview.com 1/27/06).

Employees of businesses with 50 or fewer workers will be able to purchase individual coverage through the Connector with pre-tax dollars. More than one employer can contribute for a given worker, and coverage would be portable.

According to the Conference Committee Report, the Connector must certify that all products are of "high value and good quality." All current mandated benefits are "protected." Current regulations on deductibles and co-pays apply except that products with a Health Savings Account (HSA) may have a slightly higher deductible. The sole providers of subsidized coverage will, at least initially, be managed care organizations.

Enforcement and Funding

The individual mandate to purchase a "creditable" insurance policy what Romney calls the "personal responsibility" requirement is enforced by tax penalties. At first, the individual would lose his personal state tax exemption, now worth about $150. The second year, he would incur a fine equal to about half the premium cost of the least expensive product available, around $1,200 for a young adult. There are no criminal penalties for failing to buy insurance.

All residents would have to indicate on their state income tax returns, under oath, whether they had creditable coverage for the entire 12 months. If they say they didn't, or if the commis- sioner determines that they actually didn't, any tax refund would be withheld, and if that is insufficient, all available enforcement procedures will be used to collect.

Realistically, penalties could be collected only from the uninsured with moderate or high incomes. But an important principle has been accepted, points out Michael Tanner: the responsibility of government to ensure that every American has health insurance (Cato Policy Analysis 565, 4/5/06).

Romney rejected an employer mandate and views the $295 "fair share contribution" (by employers who hire 11 or more workers but don't provide insurance) as a "fee," not a "tax increase." He writes that the Democrats added it and he "will take corrective action" (WSJ 4/11/06). In addition to the $295, a "free rider surcharge" (up to 100% of state- paid costs) would be levied on "non-providing" employers whose employees used more than a threshold amount ($50,000) of uncompensated services. Those who didn't pay promptly would face an annual interest rate of 18% and monthly late fees of 5%.

To protect $385 million/year for 2 years in pledged federal Medicaid funds, Massachusetts had to figure out how to lower the number of uninsured by July: perhaps the reason the bill is deemed an emergency measure. To make coverage "affordable," about $700 million in premium subsidies will be needed, about four times the amount provided in the bill, according to Professor Alan Sager of Boston University (WSJ 4/5/06). About $1 billion a year will be shifted around, as by redirecting money - now paid to hospitals for uncompensated care.

Data and Controls

The biggest penalties in the law are fines up to $50,000 for insurers or providers who fail to submit required data within the time allowed. The bureaucracy will track insurance status, income, participation in "wellness" programs, quality measures, and costs (but specifically not payment rates by insurer).

The plan demands more "diversity" in the health workforce, the elimination of racial and ethnic "disparities" in health outcomes, adherence to quality standards, and achieving performance benchmarks. Hospital rate increases will be contingent upon meeting such goals.

A Model?

Drew Altman of Kaiser Family Foundation describes the plan as a "Cuisinart-style package that breaks through the ideological logjam by borrowing from the left, the right, and the center" (E. Mehren, LA Times 4/8/06).

Another description might be a witch's brew. When it fails, expect a demand for stronger magic: single payer.

Views on the Massachusetts Plan

Comparing the Massachusetts law to HillaryCare, Twila Brase, R.N., of the Citizen's Council on Health Care writes: "An intrusive and prescriptive bureaucracy will be authorized to ration health care and make decisions about who gets what health care when. Health care decisions will be taken out of the hands of patients and doctors as the agendas of special interests...take precedence."

Read the complete bill at www.hcfama.org/act/ and CCHC's concise overview at www.cchconline.org.

Because physicians will be forced to submit patient data to a central clearinghouse, there will be no way to maintain truly confidential relationships, observes Sue Blevins of the Institute for Health Freedom. The health care quality and cost council established by the bill has the authority to promulgate its own rules and is specifically not subject to control of the executive office of health and human services.

Blevins also notes the difference between freedom and the limited choice among government-approved plans that will be allowed in Massachusetts (www.forhealthfreedom.org).

"Personal responsibility," writes Joseph Lee Pugh of Mississippi, "certainly does not mean that health costs incurred by a individual are, by law, transferred to an employer or to another taxpayer. This is a dangerous precedent."

If personal responsibility and keeping other people from having to pay were the point, suggests Linda Gorman of the Independence Institute, Romney could have proposed requiring everyone to buy a policy with a deductible of $20,000 or more with state premium subsidies, and then permitting the state to seize the assets of persons who didn't pay amounts below the deductible. Most people, she writes, have $20,000 in assets. The insurance would be affordable, and hospitals would get paid for big events. Instead, Massachusetts kept the very things that make insurance unaffordable: community rating and mandated benefits. It will attempt to "hide the subsidies and pass them around like a hot potato."

Why do people appear to believe that "one central administrative structure reduces costs when data, experience, and theory say that it doesn't?" Gorman asks. It's as if they think that "the Massachusetts association with witches gives it some kind of claim on magic": just "tax producers more heavily and give money to the same people who made uncompensated care so much more rewarding than Medicaid."


Mandatory Auto Insurance

In states requiring auto insurance, about 15% of drivers are uninsured, "almost exactly the percentage of people without health insurance, with no mandate," writes Greg Scandlen.

As a result of mandates, government gains control of pricing and product structure, writes Linda Gorman. One creates "a whole new class of lawbreakers, huge data demands to enable enforcement, fertile new ground for a new government plantation as people demand subsidies for those who can't afford the mandatory product, and continuous redefinition of it as various interest groups lobby for its expansion."

And what good does mandatory auto insurance do? To protect assets and future wages, people have an incentive to buy insurance. Those with no assets or no prospects to protect may even risk jail terms to avoid buying mandated insurance. Without mandates, we might have about the same situation as with them, minus the regulatory costs, Gorman suggests.

The Sliding Scale and Progressive Taxes

The most important reason for not buying insurance is that it is perceived to be too expensive. Mandated, universal coverage with community rating subsidizes high risks by forcing low-risk individuals to pay premiums enormously higher than their risk status warrants. Additionally, the sliding scale subsidy, as in the Massachusetts law, effectively forces more productive people to pay more for their insurance. The bill is about collective responsibility, not personal responsibility, based on the Marxist axiom of "from each according to his means, and to each according to his need."

In Canada, a person in the lowest decile of income (average $8,500) pays taxes at a rate of 16%, and his health insurance costs about $305. A person in the highest decile (average $201,000) pays 58% in taxes, and nearly $27,000 for health insurance (Fraser Forum, October 2005). The richest are thus required to pay 87 times as much for theoretically the same quality of care. If they are sick, more affluent Canadians often pay the full cost of their care out of pocket, outside the system.

Should the price one must pay for all necessities be an escalating percentage of one's income?


Socialized Medicine Updates

Medicaid's Unseen Costs. Michael Cannon reviews the literature supporting the view that Medicaid exacerbates poverty and the lack of affordable medical care. It discourages self help, crowds out charity and other efforts, and encourages overconsumption of care without measurable health gains (Cato Policy Analysis 548, Aug 18, 2005, www.cato.org).

"Bonus Malus" Penalties in Germany. One of the more draconian medical reform proposals of Chancellor Angela Merkel is to make doctors personally liable for 50% of the excess spending if their patients' prescription costs exceed their budgets by more than 30% (TCSdaily.com 4/4/06).

"Maximum" Wait Becomes Minimum in the UK. The National Health Service (NHS) is facing a 800 million debt, and Health Secretary Patricia Hewitt blames doctors for holding up improvements. To save money, the Eastbourne Downs primary care trust ordered the town's hospital not to operate on any patient who had been waiting for less than the maximum permitted time of 6 months (www.healthplanusa.net/April06.htm).


Equally Bad Care for All

AAPS Past President Robert Cihak, M.D., summarizes a RAND study published in the N Engl J Med of March 16. There was no significant difference in care received by type of insurance, or no insurance. "Seeing a doctor is much more important than whatever kind of insurance you have," Dr. Cihak concludes (www.newsmax.com 4/5/06).


AAPS Calendar

May 11 (Allentown, PA), May 22 (Abington, PA). See www.aapsonline.org/calendar.php.

May 19/20, 2006. Dinner meeting and Board of Directors meeting, Hilton Garden Inn, Chicago O'Hare Airport.

Sept 13-16, 2006. 63rd annual meeting, Phoenix, AZ.

Effects of Medicare Exclusion Are Vast

A physician who is excluded from Medicare may be unable to secure any kind of employment even as a ward clerk, technician, or orderly in any medical facility that accepts money from federal programs, or in an organization that contracts with such a facility. Additionally, he would be barred from receiving any federally insured loans or research grants.

The reason for exclusion may be loss of licensure for "reasons bearing on professional competence, professional performance, or financial integrity." The exclusion would continue until and unless he regained his license in the state in which it was originally lost.

An exclusion is not lifted automatically when the term expires; the physician must apply for reinstatement.

One physician who lost his license in what appears to have involved a political dispute with the licensure board writes: "One of the most distressing issues is the fact that [HHS officials] refuse to delineate the extent of the blacklist. However, they have warned me that if I accidentally am hired in a position I should not have had, I have committed a crime."

See http://oig.hhs.gov; click on "exclusions database."

The Inspector General recommends: "health care providers should periodically check the OIG web site for determining the participation/exclusion status of current employees and contractors." Those who do not do so risk civil monetary penalties of up to $10,000 per item or service furnished by such an individual, plus an assessment up to three times the amount claimed and program exclusion.


Forced Drugging and the Death Penalty

The Nevada Supreme Court rejected a petition by the mother of Daryl Mack, clearing the way for his execution, now scheduled for April 26. Mack still asserts his innocence of the murder for which he is being executed, but dropped all his appeals. He is being injected with Haldol against his will. Because the prisoner has been found competent when drugged, the Court held that his "next friend" has no standing to argue on his behalf.

"The Court's reasoning opens the door to the use of drugs that induce one to accept death by execution, and thereby drop appeals," states AAPS General Counsel Andrew Schlafly.

See www.nvsupremec ourt.us/highProfile/.


JCAHO Assaults Medical Staff Self-Governance

In its new Medical Standard 1.20, the Joint Commission on the Accreditation of Healthcare Organizations proposes to move things like fair hearings and credentialing from medical staff bylaws to "associated administrative proceedings" where they can be modified more easily, perhaps without a vote by the medical staff (see www.jcaho.org). JCAHO is now collaborating in hospitals' efforts to undermine self-governance by the medical staff, writes Dr. Lawrence Huntoon.


A liberal is one who can be open-minded about anything except the past; about that he is strictly a bigot. He divides the past into two broad categories, the "progressive" and the "reactionary," and once a thing has been placed in the latter column (also called "Neanderthal" or "medieval"), it never gets another chance.... In the terse formula of the Brezhnev Doctrine: "What we have, we keep."
Joseph Sobran, January 2006


Court Upholds Jury Findings in Poliner

The U.S. District Court for the Northern District of Texas has upheld the findings of the jury in the case of Poliner v. Texas Health Systems (No. Civ. A.3:00-CV-1007-P), stating that Dr. Poliner is entitled to judgment as a matter of law on his defamation claim. The actual amount of the damages, which the jury pegged at $366 million, has been referred to mediation.

Defendants took action to destroy Dr. Poliner's practice and his reputation, although admitting that they did not have enough information to assess whether Dr. Poliner actually was a danger to patients. They told him he could not consult an attorney and gave him no opportunity to be heard.

The jury saw through the medical complexities to understand that sham peer review is a form of "mobbing," writes AAPS Sham Peer Review Committee Chairman Lawrence Huntoon, M.D. It also understood that signing an abeyance of privileges under threat of summary suspension is not "voluntary," and that dredging up cases from the distant past does not prove an "immediate" danger.

"Hospitals will do everything in their power to see that such a case never makes it to a jury," Dr. Huntoon said.

The Horty Springer law firm is announcing seminars to teach hospitals "how to live with the Poliner decision." See AAPS News of the Day 4/7/06, www.aapsonline.org.


Medical Staff Wins in Florida Case

A special law applying essentially to only one hospital, an apparent attempt to circumvent court rulings upholding a medical staff against a hospital, is unconstitutional, ruled Leon County Circuit Court Judge Janet Ferris (Lawnwood Medical Center v. Randall Seeger, M.D., Case No. 2003 CA 2865).

Medical staff bylaws are a contract, and the law tramples on the obligations of contract in order to serve a special private interest, ruled the Court (News of the Day 4/6/06).

In effect, the law gave the Hospital Corporation of America hospital plenary power over the medical staff.


Dr. McKalip Challenges Reporting Requirement

A proposed Florida rule requiring that hospitals report Surgical Infection Prevention (SIP) measures has been challenged by surgeon David McKalip, M.D. (McKalip v. State of Florida Agency for Health Care Administration, Case No. ID05-5079). In an amicus brief, AAPS argues that the reporting rule effectively elevates disputed SIP guidelines for the use of prophylactic antibiotics to the standard of care. Even if the physician believes that antibiotics would be beneficial for a longer period in a complex case, and even though the patient is willing to pay for them, the physician might be reluctant to "raise a red flag" with the hospital and regulators by ordering treatment that deviates from the standard.


First Hospital Excluded for Violating CIA

Although the Office of Inspector General excludes an average of 3,000 to 3,600 providers a year, most of them smaller entities such as physician practices, the OIG doesn't like to deliver a financial death knell to hospitals. South Beach Community Hospital is the second ever to be excluded, and the first for violating a Corporate Integrity Agreement. It was already bankrupt (MCA 3/20/06).


"Precautionary" Measures. In its latest audio course offering, the Horty Springer law firm advocates changes to medical staff bylaws and credentialing to tighten the hospital's complete control over physicians. Watch for the insertion of language to expand the scope of summary suspension. The "precautionary suspension" basically says that maybe the doctor is a danger to patients, maybe not; we don't have substantial evidence right now, but if we suspend him, maybe we can "find" some.
Lawrence R. Huntoon, M.D., Ph.D., Lake View, NY


Why Tort Reform Failed in Oregon. A 2004 ballot initiative in Oregon failed by a few thousand votes. Most of the state, which has a physician shortage, voted for it. Portland, with a relatively adequate physician availability, voted against it. Portland also has the medical school, Oregon Health & Science Univ., which is exempt from the law that applies to private entities. Total damages, including real economic losses, are capped at $200,000 per claimant and $500,000 per incident. In a case brought by a Portland TV news anchor, a jury will decide whether the limits apply to OHSU's physicians, who claim to be agents of a public body and thus protected.
Russell W. Faria, D.O., Newport, OR


Free-Market Technology. The best practice in the world of technology is arguably open source. Linux and IBM have together developed a viable "bottom up" solution to everyday needs. Other wildly successful ones include Firefox and Wikipedia. If I were king, I would decree that physicians could not purchase proprietary software but would have to use open source so that everyone could benefit from their successful ideas. Nothing should come from the top down it is far too limiting. The same for medical records: software that is constantly being refined by anti-authoritarian, paranoid privacy wackos is generally pretty good software. The Hacker Ethic lays out the perfect case for consumer-driven medical care.
Richard A. Matthews, HealthBenefitsReform Group


Electronic Medical Records. Centrally designed EMRs will probably disallow the use of narrative style in progress notes. Boiler-plate checklists are suitable for turning doctors' offices into high-volume processing centers. Maybe that's the point. As vendors work toward a more integrated and searchable database, the real problem they see is "changing the mindset of physicians to convince them that managing patient populations is as important as managing individual patients" (ACP Observer, March 2006). Physicians who treat patients as human beings are destined for extinction, along with the narrative note.
Walter Borg, M.D., New Iberia, LA


Anti-Gravity Machines. Socialists and fascists never tire of trying to invent the impossible. They think their system can make better decisions for everyone than 6 billion individuals can make for themselves. But like gravity, the radical dispersal of knowledge is part of the human condition. The extreme limitation of the human mind means that control over resources must also be radically dispersed. Private property is essential to empower the individual to make the best use of his share of knowledge. Central planners invent absurd incentives, such as paying producers of glass by weight (or paying doctors by the RB- RVS). When all glass was made 3 inches thick, the Central Committee after long delay changed the incentive, to pay by area. Then glass was then made 0.1 inch thick. End-users and producers must be able to contract freely with each other, according to their own values, to come up with a usable product in medicine or any other area of the economy.
Robert P. Gervais, M.D., Mesa, AZ


Wrong Assumptions. As long as the controlling paradigm is that patients are inanimate objects to be delivered for processing to the "health care system," reforms will fail. Patients, working with doctors they trust, must control where the funding goes. An industry that assumes it's entitled to a minimum of funding, combined with a political class that intends to put a maximum on funding each disregarding patients' values cannot produce a successful result.
Sean Parnell, Heartland Institute, Chicago, IL


"Too Stupid to Choose" Coalition. The TSTC coalition of leftist policymakers, journalists, and advocates complain about the "bewildering" array of choices confronting seniors in Part D. It wants people to be stuck in the confines of government-run medicine to prevent the creation of a real market.
Ernest J. White, Alexandria, VA


The King Can Do No Wrong. Although I never accept assignment, Medicare occasionally sends me an unwanted check. Recently, I received one for $41.35; the attached EOB said the amount due was $117.45. After several "holds" to reach a supervisor, I was told that Medicare has the right and power to discount payments [even further] should they receive insufficient funding for payment of their bills!
Anthony W. Orlandella, M.D., Dana Point, CA


Compromise. You can't compromise and make a truce with those who want socialized medicine. Equality is their god, and equality requires government control of medical care. It's like negotiating with God-inspired suicide bombers. They'll take your concessions to help their cause, and blow you up anyway.
Linda Gorman, Independence Institute, Golden, CO

Legislative Alert

Medicare Drug Implementation

May 15, 2006, is the last day that seniors can enroll in the new drug entitlement without financial penalty. We will then have enough data to assess the initial impact of the massive Medicare drug entitlement, including enrollment, cost, and satisfaction. In sheer numbers, the Administration appears to be on track with 25.4 million beneficiaries with drug coverage; the Congressional Budget Office (CBO) projected that 29 million enrollees would enroll in the drug program in the first year.

The facts show, however, that an overwhelming majority of these folks have been automatically enrolled by third- party payers, including former employers getting billions of dollars in new government subsidies, the Medicare Advantage plans that have drug coverage already, and dually eligible senior and disabled people in the Medicaid program. The last group had no choice at all in the matter. But that's where the implementation problems appear to have been the greatest.

What about those who voluntarily signed up for the program? According to a March 2006 survey of seniors conducted for America's Health Insurance Plans (AHIP), the largest insurance trade group, more than eight out of ten seniors had no problem enrolling or using their new drug benefit; more than six out of ten say that they would recommend it to other seniors; and only 3% of seniors reported a problem enrolling and using the benefit.

Meanwhile, as we predicted when the Medicare Modernization Act (MMA) was signed into law in December 2003, the creation of a universal government entitlement for prescription drugs would, sooner or later, result in the imposition of government price controls on drugs. The entitlement structure creates the policy dynamics. (It's the structure, stupid!) For the Left, that was the game plan all along, after filling up the notorious donut hole. Only very foolish or delusional Republican congressional collaborators a minority, we're certain have ever thought otherwise. It would only be a matter of time.

Well, an amendment recently offered by Senator Ron Wyden (D- WA) and Olympia Snowe (R-ME), and backed by the well-heeled AARP, would provide the federal government the authority to "negotiate" drug prices in Medicare. Under Section 1860D-11(1) of the MMA, the Secretary of HHS is prohibited from interfering in negotiations between private health plans and drug manufacturers or setting up a national formulary (a list of "preferred" drugs) that would be available to Medicare patients. This form of the price controls "Government Negotiated" pricing simply means that the government will deny access to the market for any companies that don't accept the government price for drugs. It passed 54 to 44 on the Senate version of the budget bill, with Senate Republican defections on the issue. This was not surprising. After all, in 2005, 51 members of the Senate endorsed overturning the current legal restriction that forbids the Secretary of HHS to "negotiate" drug prices for the Medicare program. Look for the Left to launch, with the full backing of the AARP, a similar effort in the House of Representatives.

Drug Facts on the Ground

What is doubly curious about the recent Wyden-Snowe victory in the Senate is that it comes at a time when the private-sector negotiation over drug prices is working very well to control Medicare drug costs. In fact, the top private-sector prescription benefit managers already have larger shares of the market than Medicare, and thus heavier "market clout" than Medicare itself. When the drug entitlement was enacted, the initial cost projection for the average monthly premium for drug coverage was $37 per month; it is, in fact, now $25 per month, or one-third lower.

We fully confess, as vocal critics of the Medicare drug entitlement, that we did not anticipate either the level of competition that emerged over the past year for a stand-alone drug benefit, nor did we imagine the size of the actual premium reduction. Recent CMS data shows that 93% of beneficiaries have access to a stand-alone Prescription Drug Plan (PDP) with a monthly premium of $15. More than 50% of the competing drug plans offer a richer benefit package than had been previously anticipated, with no deductibles, lower copayments, or partial or complete closure of the notorious "donut hole" (the $3,600 out- of-pocket gap in coverage). Within Medicare Advantage plans, almost three out of four Medicare beneficiaries have access to a drug plan without any extra premium. As with normal health plans, drug coverage is integrated into the MA plan benefit coverage. Of course, that could have all been easily accomplished through the original premium support proposal that Congress rejected during the 2003 Medicare debate.

It is also worth noting that the CBO has repeatedly told Congress that the far more flexible private-sector process of negotiation over drug prices, using price discounts and rebates and other tools of cost control, would be more effective than the government price-setting mechanism, which would simply exclude a drug that did not or could not meet the government's price level. Naturally, the Left points to the Veterans Administration program as a superior program. While it is a single-payer system, like Medicare, it is very different from Medicare in its structure, function, and patient population; it has stricter formularies than obtain in the Medicare program and accounts for only 2.1% of drug expenditures in the United States. This makes it unlikely that VA-style price controls would be replicated in Medicare with the same effect, though it would surely result in a massive cost shifting to consumers in the private sector.

Ethical Health Plans?

High-profile controversies over costs and coverage have largely obscured an emerging debate over ethical issues, including the rights of conscience and personal choice.

The rights of conscience for doctors, nurses, or pharmacists, over issues like abortion or end-of-life care, have gotten the most media coverage. Some doctors insist on following the Oath of Hippocrates or a variant of it; but most physicians don't subscribe to the Oath of Hippocrates any longer or worse, subscribe to a watered-down version.

A debate about the right of conscience among patients is potentially more important. They don't effectively have many rights. For example, 46% of employees, according to a recent Kaiser Family Foundation survey, are in insurance plans that cover abortion. So, we have whole classes of Americans who pledge themselves, on Sundays, to moral and religious beliefs requiring the defense of life, then directly finance abortion through their insurance premiums at their workplace. They may finance other ethically controversial items, too. But most don't know it. Employers or union officials make decisions about benefits without regard to an employee's beliefs or preferences. Changes in tax and insurance laws would enable people to choose an insurance plan in accord with their own values. Sen. Sam Brownback (R-KS) has indicated that he will be introducing legislation that would enable people to opt for values-driven plans or plans sponsored by religious organizations.

Single-Payer Surge

It's been building for months. An op-ed here, an editorial there. Public intellectuals of the Left have been making single-payer noises, notably Harold Meyerson of The American Prospect and Paul Krugman of The New York Times, But the recent editorial in The New Republic makes it official: the big single-payer surge is on. Its editors have just outlined the case for having the government take over the entire medical system. It announces: "Government isn't the best way to provide all Americans with health security. It's the only way. And it's time for liberalism to say so openly."

The New Republic editors say the best single-payer model for America is drum roll, please Medicare. The system with a little debt of $30 trillion and growing, and tens of thousands of pages of bureaucratic rules many of them profoundly stupid is the model of "fairness" and "efficiency."

The key decisions in a national health system are budgetary that is, political decisions. Not medical or even conventional economic decisions. Congress would be in charge of all medical care. Ponder that prospect.

A crucial issue is whether Americans would be free to spend their own money on legal medical services of their choice without government restrictions. In Canada, despite a recent Canadian Supreme Court decision, there are still obstacles. In the United States, Medicare beneficiaries are denied this option.

Britain provides an escape hatch for those patients dissatisfied with the government system, and in 2005, 6.9 million British subjects, 11.5% of the population, were enrolled in private medical insurance. British patients can also contract privately with British doctors, including those who work in the NHS, on a case by-case basis. Curiously, more than 40% of doctors in British hospitals also are enrolled in private insurance.

A system based on central government planning is always slow to change; in fact, bureaucracies are largely unsuitable for executing rapid change. Bureaucratic institutions, such as the lumbering Medicare or Medicaid bureaucracies in the United States or the National Health Service in Britain, do not and cannot quickly adapt to changing conditions in the same fashion as private firms in a highly competitive market. Because government officials must weigh the cost to the taxpayers of any medical treatment against a perceived benefit, there is an added incentive to restrict or reject more expensive drugs, treatments, or procedures. Recently, Britain's National Institute of Clinical Excellence (NICE George Orwell call your office!) recommended against the use of Aricept, an expensive drug to treat patients suffering with Alzheimer's disease that is widely available in the United States. The British panel determined it was too expensive for the NHS but modified its restrictions after protests from thousands of British patients and caregivers.

The single-payer final solution does not eliminate problems with patient safety, care coordination, treatment for chronic disease, and patient-physician communication, but may in some cases exacerbate them, as international comparative surveys show.

American advocates of a single-payer system often acknowledge the shortcomings of the British or the Canadian system such as waiting lines and rationing but say that they will do it better or do it differently (or will make it go away with more funding). They will be superior in their conception and execution of the government program. They will work hard, put in long hours, burn the midnight oil, order carry-out pizza, hire the best brains that Lefty think tanks can spare, refine every government payment formula for doctors and hospitals, collect enormous amounts of data, and run computer models that would baffle Albert Einstein. The tacit assumption: American technocrats would be superior to sincere British socialists or Canadian bureaucrats at running a socialist system for financing and providing medical care.

Right. You can count on it.

Robert Moffit is Director, the Center for Health Policy Studies at the Heritage Foundation, Washington, D.C.