Yes, health care is a commodity

I’ve been hearing the argument that health care is not a commodity for the past month or so. It’s another way to play on the emotions of the electorate, since it’s kind of obvious that health care is a commodity… but it does not feel right to say it.

Just because health care is not traded like pork bellies or sugar on the Chicago Mercantile Exchange (a product) does not mean it is not a commodity. Health care is a service, and the service, quality and cost of health care is affected by the laws of supply and demand just like anything else.

Ed Morrissey over at Hot Air reminds us of this fact as he notes many liberals – including Rep. Anthony Weiner (D-N.Y.) – flat out want to destroy all private health care insurance since he does not think health care should be a commodity.

Ed notes the “key points come at 2:31, 4:44, 5:15, and 7:15, but the 5:15 is when the light dawns for Scarborough”.

Transcript from Morning Joe courtesy The Moderate Voice

Scarborough: It sounds like you’re saying you think there is no need for us to have private insurance in health care.

Weiner: I’ve asked you three times. What is their value? What are they bringing to the deal?

Scarborough: Again… I’m astounded by your question. It sounds like you’re suggesting that there’s no need to have a country that’s run on free market principles.

Weiner: Time out. Let’s focus on one thing at a time. This isn’t a commodity, Joe. Health care isn’t a commodity.

Scarborough: You’re saying that health care is different than everything else.

Weiner: Health care is not a commodity.

Scarborough: But you are making the conservatives’ point. You are making the point of the people at the town hall meetings who say this is Barack Obama’s opportunity to get rid of private health care and turn it completely over to the government. I’m sitting here stunned, saying Oh My God, you’re making the point of the health care protesters.

Weiner: If Barack Obama doesn’t want to do it, I want to do it.

Any good or service with a cost is a commodity. Continuing from Morrissey…

What do insurance companies do for health care? Weiner asks this question repeatedly as if there is no answer, but it’s as obvious as the fact that goods and services are commodities. Insurance companies provide risk pools for consumers that allow them to indemnify themselves against catastrophic health-care costs. It’s that simple. By paying a few hundred dollars a month in premiums, customers can get access to a wide range of goods and services in health care when needed. Insurance companies or private-sector co-ops attempt to calculate the risks to set the premiums at a point where customers find the pricing acceptable, investors in the risk pool can get a profit from its creation and maintenance, and providers get adequate compensation for their goods and services. The more these insurers compete against each other, the better pricing consumers get and the more efficient they become at controlling costs.

Anyone who doesn’t understand that much about economics has no business creating policy.

One of the main problems over the past few decades is liberals (including some RINOs) trying to brainwash people into thinking health care is not a commodity. They do this through regulation.

As an example, walk into your eye doc’s office and ask them how much it would cost for cataract surgery. You’ll get the why-the-heck-would-you-want-to-know-that look from the receptionist.

Eventually, after watching a bunch of well-meaning health care providers whisper among themselves, they may give you a figure – not understanding why you would want to know in the first place – but they will strongly suggest you go to your health insurance company and ask them what the “negotiated” rate is.

Someone remind me to write a post on how the $10 co-pay destroyed our understanding of how health care should work in the first place.

Then, let them know you have a high-deductible health plan and you’ll be paying for the surgery out of your Health Savings Account (HSA). They will feel bad for you since you don’t have one of those $10 co-pays.

Don’t you know it only costs $10 for an office visit? </sarcasm>

Next, go to the insurance company and ask what the negotiated rate for cataract surgery is for the four best doctors in the area. You won’t get a number, and you won’t be able to easily get quality ratings on those doctors either.

I can call the Better Business Bureau and get the ratings of plumbers, but not eye docs. Wonderful.

The system now is not perfect, but I strongly believe that consumer-driven health care – programs like HSAs – were a step in the right direction, putting the consumer in charge of decsions and placing perception of value back into health care choices. (The $10 co-pay destroyed all perception of value when it comes to health care.)

I say “were a step in the right direction” since it looks like HSAs are a target of the current administration. That’s right, liberals don’t like HSAs simply because we get to keep the money year to year, it can be invested tax free, and it forces Americans with these plans to actually show some interest in how much our health care costs…. God forbid!

10 replies
  1. Dimsdale
    Dimsdale says:

    I think Rush put it best: government health "care" makes people a budget item, and thus, the relationship between gov't and the American people will be forever changed, particularly if you are what the government deems "expendable."

  2. IWorryMyMomWorries
    IWorryMyMomWorries says:

    If health reform passes, cataract surgery will mean jamming red and blue pills into your corneas.

  3. sammy22
    sammy22 says:

    When you are having a heart attack you don't go shopping for the best price, nor when you get picked up in a car wreckage. At least say (admit) that there is a difference between elective (or I have the time to check options on my cataract surgery) and when 911 has been dialed. Everything is simple until you are faced with a crisis.

    • Steve McGough
      Steve McGough says:

      No kidding, of course it's different. But emergency visits are not the bulk of the cost. This site says it's less than 3 percent.

      On top of that, emergency care is available and there is a federal law in place that stipulates you must be treated. You're not turned away.

      Then again, if emergency departments are required to treat and don't get reimbursed by the government or whomever, they close the doors. Doctors leave and hospitals close if they can't make any money. Go try to find a doc who will take new Medicare patients in some parts of the country – can't find one – since the government plan ensures they loose money on every visit.

      Why don't you just say you want government to take over health care and we can leave it at that. There is no friggin way private carriers can compete with the government in the ball game. None at all, and simple economics proves me right. Can't make money? Not offering the service.

      Your arguments are always based on emotion and how it should be, never reality, economics or fact. So, I'm done responding to you.

  4. sammy22
    sammy22 says:

    I don't want government to take over health care. I do want everybody to be covered and to pay for health care (not pick and choose and when a leg is broken in a skiing accident have somebody else foot the bill). Sure it's an emotional response to have to call 911, I don't think you'd happy to do it either. As for the site you sent me to, you forgot to note that the 3% cost in ER does not include the going to intensive care for the heart attack or whatever. You are selective in your choice of facts, but flick off others. We ALL pay for those that either don't have, cannot afford or CHOOSE NOT TO HAVE coverage. These are FACTS.

  5. Gzoref
    Gzoref says:

    Rep. Weiner is right on target. And health IS a Right, not a Privilege
    Nobody should be at the mercy of companies that can deny and rescind coverage willy-nilly. Cigna only has an obligation to their shareholders. The government has an obligation to it?s citizens. Who?s gonna provide better coverage?
    Ask senior?s and veterans to give up their socialist healthcare in the name of the free-market; explain the virtues of Cigna to them.

    • Steve McGough
      Steve McGough says:

      So you're saying the federal government won't deny coverage willy nilly? You're delusional, they are doing this now and you know it. Health care is not a right, it is a commodity, but your emotions are driving your argument.

      I know seniors – covered under Medicare – who are unable to get a primary care physician right now because docs will not take them.

      At least you're being honest saying you want the government to take it over and you think their should be no health insurance companies. You're wrong, but honest about that. You want the socialist way – just admit it and you'll feel better.

      I've been discussing facts about the insurance companies and how they are, and will be, better than a government system. I also refuse to accept the premise we have a private system now run by health insurance companies – that is a lie and everyone knows it. When government already runs Medicare, Medicaid and dozens of other state, federal and local government funded programs, the system is no longer private.

  6. sammy22
    sammy22 says:

    The doctors, hospitals etc. provide health care. The insurance cos, Medicare, Medicaid, VA etc. programs pay for the services. Can we at least agree on that, and not mix them together and make it sounds like the government is running the system. Otherwise, if the government is already running the system the ball game is already over.

  7. Steve McGough
    Steve McGough says:

    Uh, no – we can't agree on that. Insurance companies, Medicare, Medicaid … may write the checks, but where do you think the money comes from? I also never said the government was running the system, I said because of their involvement, it can no longer be considered a private system. I'm done with the word play.

Comments are closed.