Thursday, March 25, 2010

Will Uncle Sam control health costs as he did gas?

If the government wants to get serious about making health care more affordable, it needs only to look in the mirror. It's tough to blame insurance companies for all our health care problems when the government controls more of the entire industry (around 50%) through Medicare and Medicaid. Not only do these program deny more people coverage per capita than private insurers, these programs significantly raise costs for everyone.

Medicare and Medicaid pay Walgreens, doctors, and pharmaceutical companies at a rate set by the federal government. This is a form of price controls. The wonderful news is that the Obamacare bill that was rammed through the House last Sunday is going to multiply this practice throughout the entire industry.

Governments have never been great at regulating prices. Remember the gas crisis in the 70s? The long lines and rationing came because the United States attempted to control gas prices. This is what we get to look forward to with Obamacare

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