George Gibbs Center for Economic Prosperity

Orlando Sen⁠t⁠⁠i⁠nel — Flor⁠i⁠da needs free-marke⁠t⁠ reforms: Fron⁠t⁠ Burner

By: Dr. J. Robert McClure / 2015

Orlando Sentinel
“Florida needs free-market reforms: Front Burner”
April 24, 2015
By J. Robert McClure Guest columnist
In Lewis Carroll’s famous “Alice’s Adventures in Wonderland,” Alice pleads with the Cheshire Cat, “Would you tell me, please, which way I ought to go from here?”
His reply: “That depends a great deal on where you want to get to.”
In Florida’s Medicaid debate, most of us are clear, and even on the same page, regarding where we want to get to — increased access for all Floridians to affordable, quality health care. We can also agree on two facts — in the current system, health-care costs have seen meteoric rises and too many individuals are not covered. Both of these facts are wreaking havoc on Floridians ranging from low-income individuals, to business owners, to hospitals, and of course, the taxpayer, resulting in the unsustainable path we now find ourselves on.
Under the current system, those who are uninsured do receive care through visits to the emergency room and other avenues; because of this, as much as 8 percent of the cost of care in Florida is shifted from those who can’t pay to those who can. That means small-business owners and Floridians purchasing policies pay more than $1 billion annually to cover the costs of the uninsured. This comes in the form of added premiums for your employees if you are a business owner or added cost to your insurance policy if you purchase your own health-insurance plan.
It’s in this context that the Florida Senate put forth a blueprint for expanding the flawed government program. This plan is being advertised as a “free-market” approach to solving our health-care challenges. As someone who has worked tirelessly advocating for the power of the free market, I can assure you the Senate plan is neither free, nor market-based.
Using the term “free market” to describe a plan that relies on short-term, recurring federal dollars and price controls is like Alice peering through the looking-glass — it’s the exact opposite of reality. The plan relies on roughly $50 billion from a government $18 trillion in debt, adds 800,000 Floridians to the ever-growing Medicaid rolls, and does absolutely nothing about controlling the cost of health care, the core of the problem.
Moreover, the proposal does not improve quality of care, bring price transparency to the system, increase the supply chain of health-care practitioners, or reward innovation that will lower health-care costs.
True free-market reforms, however, will do all of the above. The use of catastrophic-care plans and Health Savings Accounts, expanded scope of practice for nurse practitioners and physicians’ assistants, price transparency so that those paying know what they are paying for, telemedicine without exclusions, and serious medical malpractice reform will bring health-care costs down while increasing access to quality care for the Floridians who need it most.
Although the federal government has promised to pay 100 percent through 2016, Florida taxpayers will still be on the hook for 10 percent of the expanded costs thereafter. Setting aside whether we can trust the federal government to deliver on its promises, according to an August 2014 report from the Robert Wood Johnson Foundation, this would add up to a taxpayer bill of $536 million annually, taking state budget funds away from priorities such as education, the environment and public safety.
We did not get into this challenge overnight, and we’re sure not going to get out of it overnight. Florida’s leaders should chart a course of genuine reform that will bring stability and accessibility to our health-care system.
As much as we all want to believe this isn’t a Wonderland scenario, it’s absurd to think taking billions of dollars from a federal government — one as unreliable as the aforementioned cat with its Cheshire grin — is the answer.
J. Robert McClure is president and CEO of The James Madison Institute, a free-market think tank based in Tallahassee.