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September 28, 2010

Re: Sibelius defends the indefensible

Over at American Thinker, Aaron Gee deconstructs Health and Human Services Secretary Kathleen Sebelius' utterly unconvincing retort to charges of thuggery in her threats to health insurance companies and exposes her faulty logic and amazing amount of ignorance of highly pertinent and inconvenient facts about a system that she is supposed to understand. His must-read piece is a lesson in the the economics of the insurance industry and the drivers behind the cost - all of which Sebelius (and the Democrats) would do well to read and attempt to understand (a difficult endeavor for them, given their ideologically-driven blindness to facts that contradict their faulty logic and assumptions).

Gee writes:

What is amazing about this display is that she doesn't use the space provided to defend her actions, but to attack and demonize the private health care insurance industry. Sebelius's writing is entirely unconvincing and riddled with faulty logic.

Sebelius: "Over the past decade, Americans have seen what happens when insurance companies have free rein"

Currently insurance companies are regulated by both state and federal agencies. Nearly 50% of every healthcare dollar that is spent is controlled by the federal government. What Sebelius calls "free rein" is in truth attempting to compete in a partially socialized and one of the most heavily regulated industries in America.

Sebelius: "The cost of health insurance has more than doubled"

There are 3 primary drivers of increasing health insurance costs. Current Medicare and Medicaid don't cover the costs of the care provided to patients that are in those plans. That means that health care providers have to make up those un-recouped expenses by charging more to individuals that have private insurance. The program that Sebelius is defending exacerbates the problem.

The other drivers to health insurance cost are demographics and, ironically, good health care. The baby boomers are entering their 60s and people are living longer, thanks to excellent medical care. The increased lifespan also increases the cost per patient in the twilight years of their life. The final driver is the fact that new procedures and medicines cost billions to develop. Our cancer survival rates are the best in the world, but the cost to treat cancer patients with new medicines or procedures has to be high to recoup the investment required to discover them.

If our HHS secretary truly understood the health care industry, she would understand the cost drivers. Instead she resorts to demonizing health insurance companies. She doesn't see government interference in the market as a problem. Sebelius just repeats the leftists meme " markets have failed Americans time and time again", when in truth the markets have rarely been given a chance.

As Gee goes on to aptly point out, none of Sebelius' arguments have anything to do with the reason she wrote the article in the first place. What started this latest flap is that she threatened insurance companies that dared tell their clients the truth - that their costs were going up because of ObamaCare. And if the Congressional Budget Office reports that ObamaCare will cause a rise in premiums, why can't insurance companies say that?

"Inconvenient facts," indeed. And an obviously indefensible case of political thuggery by an administration.that clearly has no clue about our (up until recently) free-market economy and an industry it is in the process of forcibly taking over and destroying.

Posted by Richard at September 28, 2010 7:04 PM

• Re: Sibelius defends the indefensible - Sep 28, 2010