Issue paper #2: Health care

It has long been a principle in our society that people should not be denied health care simply because they cannot pay. Doctors are required by oath to give emergency care to anyone who comes to them. Hospitals are required by law and by basic principles of Judeo-Christian morality to do the same. Having made the commitment to provide people with medical care, the question is how to do this in the most efficient manner.

As a conservative Republican, I believe that to the greatest extent possible we should leave the allocation of resources to markets rather than government. In general markets are the most efficient mechanism to accomplish this. Economic theory and years of experience demonstrate that when markets are competitive, government interference only leads to inequity and inefficiency.

Markets for health care and health insurance, unfortunately, are unlike other markets. Consumers are not willing or able to weigh costs and benefits of treatment, especially in emergency situations. Health insurance markets are plagued by the problems of moral hazard and adverse selection. As a result, a free, unregulated health care market delivers excellent care for the majority of people, but young people and people with low incomes typically do not get coverage. When they get sick and require care, the cost of care is borne by those with insurance. This raises the cost of health insurance, raises costs for business, and makes our economy less competitive.

To deal with these problems, liberals have long advocated a system of universal health care modeled on Medicare. But government-run health insurance will inevitably fail to control costs. The most popular measures to control costs under Medicare, such as placing price controls on pharmaceuticals and forcing doctors and hospitals to accept lower reimbursement rates, merely shift costs to health care providers and in the long run will destroy the incentives to invest and innovate.

Republicans have a better plan. In Massachusetts, Republican governor Mitt Romney implemented a system under which government provides vouchers to individuals to buy health insurance from private insurance companies. Insurance policies were made more uniform and are sold on "exchanges" that closely approximate competitive markets. As a result, almost all residents of Massachusetts are now covered by health insurance, and the plan remains popular. A version of this plan has been proposed by Republican Congressman Paul Ryan to transform Medicare. The voucher system is similar to conservative proposals for reform of public schools. Given the success in Massachusetts, I propose applying this plan nationwide.

Now, Democrats passed a health care plan modeled on the Massachusetts experiment in 2010. In this case, Democrats were adhering more closely to conservative principles than my fellow Republicans. However, the Democratic plan included a smorgasbord of taxes and fees on things like medical devices that represent a harmful and unnecessary intrusion into private enterprise. I propose eliminating these onerous taxes and fees and other regulations contained in the bill (though the elements of the law forbidding insurance companies from setting lifetime limits for coverage and denying care to people with pre-existing conditions need to stay). The Democrats' law also did not include tort reform. I will insist that Congress amend the law to ensure that there is a predictable system of compensation for medical malpractice that is fast and efficient, treats like cases in the same way, and provides meaningful incentives for doctors and hospitals to maintain high quality without imposing excessive costs on them.

Reform of our health care system did not end with the passage of ACA in 2010. Republicans need to be at the table when the new system is modified, as it must be, in the years and decades to come. We need to resist costly add-ons to the system while maintaining the market emphasis of the legislation and ensuring that states have the flexibility to experiment with alternative arrangements. Republicans can best accomplish this if they are active participants in reform rather than taking the nihilistic approach of the current Republican leadership. I pledge, if elected, to be such a positive voice for reform.