by G. Keith Smith, MD
One of the smartest people I have ever met is a property and contracts lawyer, someone from whom I have gleaned countless and valuable insights over the years. He has advised me, among other things, to lead a “haggle-free” business life, where bids solicited from vendors are a “one chance” occurrence. There are no counter offers allowed. Over the years, this has ensured a good price and a mutually beneficial arrangement all at once at our surgery center.
He has also taught me what a contract breech looks like and how to think through the extent of damages. While I do not pretend to understand the tiniest fraction of his trade, I am confident that what I have learned from him has kept me out of hot water many times, particularly relating to business activities at the surgery center.
“People love to sue insurance companies because many times they deserve it,” he told me once. Paying insurance premiums to a company offering homeowner’s insurance, for instance, with the understanding that weather damage would be “covered” represents a contract. Any failure to make good on this “promise” by the insurance company exposes them to accusations of contract breech and fraud. Collecting premiums and paying no claims is always a moneymaker, until this fraud is exposed. Health insurance companies and many other types of insurance companies actively engage in practices that minimize or refuse payment of claims, bound only by what they feel they can likely get away with. I am convinced that this is one reason insurance companies change their names frequently, this practice allowing them to scam the same population, masked by their new name.
What do you do if you live in a country with “single payer” health insurance and realize that you have been scammed, paying premiums (taxes) for many years, only to find out that you have little or no benefit? You thought you were “covered” for various procedures or treatments only to find out that the treatment for your cancer was essentially in “layaway.” You can’t sue for damages. There is no recourse. There is nowhere to turn, other than to leave the country to purchase healthcare elsewhere. I am not sure there could be a better argument against single payer than an utter lack of recourse.
The lack of market competition and the recourse market failure represents, explains the failure of health care delivery in all socialized systems, whether in Canada or the VA system here, or the new Obamacare silliness. Canadians have to buy health insurance, basically by paying taxes earmarked for the small amount of health care placed in layaway on their behalf. People in the U.S. now must buy “insurance” or pay a penalty. Worse, employers must provide insurance to their employees or pay a penalty. What’s the difference? The “purchases” in single payer countries and those in the U.S. now both occur at gunpoint, both mandated payments to those in power or connected to power.
Before you lay the blame for Obamacare on all of the stupid people in Washington, consider for a moment, Rothbard’s historical method. The brilliant “Austrian” economist began every investigation of historical events with “cui bono,” or “who benefits.” In short, he identified the beneficiaries of a law or government intrusion and assumed the worst of them, rarely if ever mistaken in his provocative conclusions.
Similarly, I maintain that to truly understand the purpose of Obamacare one must, I believe, start with the end result, that is, lots of very identifiable people and businesses getting rich because of this “law.” In the private sector, a scam like Obamacare would of course be considered criminal, at least a breech of contract.
The victims of single payer healthcare, VA healthcare and increasingly, Obamacare, are learning these lessons in the hardest ways imaginable. The most difficult task it seems is to come to believe that the gang in D.C. knows exactly what they are doing and doesn’t care about broken promises or lives.
At the Surgery Center of Oklahoma we plan to continue trumpeting the power and the beauty of the market at work in health care, hoping that our facility’s success and wonderful patient success stories will more quickly bring an end to the idea that the provision of health care should be entrusted to the corrupt state.
Smith MD, G. Keith. “Government Healthcare as a Contract Breech.” Surgery Center of Oklahoma Blog, July 2014. Web. 23 Sep 2014.