I thought this comment by Julie A of AZ to my post on "reality" deserved to be front and center...
When did 'profit' become such an ugly word and misunderstood concept? And how is it that we can live in the one society that has benefited most from a capitalistic approach and not understand capitalism at all? It seems that the government can attack any industry (drug companies, insurance companies, oil companies, etc) by pointing out that they are motivated by 'profit' (boo, hiss).
Doesn't the average American realize that almost all of the drugs that exist to increase our lifespan and quality of life are there solely because it was profitable to invest in research and create them? The irony is that are people today writing and blogging about the evils of a profit driven system that would probably be deceased if creating amazing new life-extending drugs was not a profitable business (Michael Moore, perhaps?) And what about the insurance companies? Insurance has to be a profitable business for insurance companies to exist. Which of course is the true market destroying threat behind any type of government funded public health insurance option.
If the government (the universe's largest non-profit organization) offers health insurance they won't have to worry about being profitable...why should they? They obviously have no problem spending more than they have and running on a huge deficit. So in the "public interest" they will offer free or almost-free health insurance and undercut every other insurance company out there. Soon, the average insurance company won't be able to compete with the public option and still make a decent profit, so they will opt to take their business talents to a more rewarding industry and close their doors. Soon, there will be less and less insurance companies...until, all we have left are the government-tun public option and a handful of government-subsidized 'private' companies to keep up the myth of private health insurance. That is the real threat of any 'public' option.
Once you drive the profit out of an industry, you drive out innovation, talent and, eventually, the industry itself.
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Reaping What You Sow
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The economic policies that the Obama Administration has implemented through
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13 years ago
Anyone interested in the reality of a public option should look closely at 'TennCare' which is a government-run healthcare pilot program in Tennesee (in case medicare is not enough for you). Here is a basic description of TennCare --- "The U.S. Department of Health and Human Services granted the state a five-year waiver to conduct a demonstration in which the state would use managed care to reduce Medicaid costs and would use the savings to provide coverage to people who were previously uninsured" And the result? "The total annual budget for TennCare increased from $2.64 billion in 1994 to more than $8.5 billion in fiscal year 2005, with essentially no change in the number of participants enrolled. After becoming Governor in 2003, Phil Bredesen hired the consulting firm McKinsey & Company to evaluate the of the financial sustainability of TennCare and make recommendations for future actions. The McKinsey report, issued in late 2003, concluded that TennCare was not financially viable. A follow-up report in January 2004 identified options that ranged from returning to the original Medicaid program to setting limits on enrollment and benefits. In response to these reports and to stem the growth in costs, in 2005 the state implemented several program changes, including removing about 190,000 participants, imposing limits on the number of prescription medications each participant could receive, and reducing some other benefits." In summary, same number of people covered for more money with additional bureaucratic limits set on medications and benefits. What a winner.
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