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Why Obamacare Will Destroy America

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June 12, 2012 in Uncategorized


I have noticed that many people in the liberty movement are against Obamacare, but upon questioning, do not really understand why. They know that they do not like Obama, that his policies are socialistic and tyrannical, and that he is bought and paid for by the by the global elite. The individual mandate is itself unconstitutional, as the government cannot force a citizen to buy any product or service. However, even without the individual mandate, Obamacare is extremely dangerous. As someone inside the system, who had given this a lot of thought, let me try to explain why Obamacare will destroy our healthcare system.

The Patient Protection and Affordability Act (aka Obamacare) at the end of the day is really designed to do one thing. It is designed to spur the creation of what is known as ACOs, or accountable care organizations. These ACOs are essentially huge networks that connect doctors, hospitals, and patients. Think of an ACO like a multi-billion dollar corporation that essentially uses its size to distribute risk amongst everyone. It allows for doctors to safely (i.e. without risk) practice capitation, a system of healthcare delivery in which the physician or physician group takes care of a population of people for a given amount of money. For example, if I am a doctor practicing in an ACO, the ACO will give me $X dollars to take care of Joe Shmoe for the year, regardless of how many times I see him. Capitation is ideally preferable to what we have now (fee-for-service), because in the current system, doctors are incentivised to basically see as many patients and do as many procedures as humanly possible, because they are paid for the things they do. This in turn, leads to short, frequent, low quality interactions with your doctor. The problem with capitation is risk. If a physician were to practice capitation without an ACO, he would simply collect a certain amount of money from the insurance company to take care of each patient. However, this implies a large risk because if one patient ends up being very costly and you spend more money on that patient than the insurance company gave you, then you LOSE money on that patient. ACOs claim to solve this problem because they network so many providers and are so big that to them, risk is acceptable and allow individual physicians to concentrate on providing healthcare and not going bankrupt.

Now that I’ve given you some background, let me explain the problem. The individual physician is part of a network. Individually, the physician has no risk, he is paid by the ACO to do his job. You might ask, “well if the physician is paid a certain amount of money to take care of his patients and he has no risk if he does a bad job, then what is his incentive?” Excellent question! Because the physician has no risk, the incentive must come externally from the ACO. The ACO has various quality measures, and if the physician meets these measures, they are rewarded with money. For example, suppose the ACO were to say, “If 95% of your patients with an LDL above 130 are on a statin, you get $10,000.” Do you see where this is going?

Basically, one of the major problems with Obamacare is the physician loses his autonomy and becomes a slave of the ACO. It allows the ACO to dictate health policy and it takes the decision making ability out of the hands of the individual physician. There used to be a time when doctors were free thinkers and were allowed to interpret the medical evidence for themselves. Obamacare makes every doctor a slave to what will become the “protocol” of the ACO. Take the above example. You might be saying to yourself, “Well, isn’t it good to take a statin if you have a high LDL cholesterol? Doesn’t that prevent heart attacks?” ACTUALLY, what is far more important than LDL is your LDL/HDL ratio. Also, not all LDL is created equally, particle size matters. What about trying natural products like fish oil before statins? Regardless of your person opinion about statins, it is nevertheless your opinion, and your doctor should not be incentivized to make any decisions that are not based on his own intellectual interpretation of the medical evidence.

Under Obamacare, medicine becomes even more monopolistic. Allopathic medicine already creates an monopolistic environment in the larger realm of healthcare, but Obamacare pushes it even further. Instead of having hundreds of independent doctors to choose from, now you must choose between one of the huge multi-billion dollar corporation-like ACOs. It is akin to McDonalds pushing out the local hamburger place that actually bought organic meat. Monopolistic healthcare will be a breeding ground for corruption. The ACOs will eventually (if they are not doing it already) partner up with drug companies and the government itself. What you have to remember is that you cannot allow companies to take care of you. Multi-billion dollar corporations do not care about your health. They only care about making money. Monopolistic medicine run by corporations will only serve to decrease innovation. Any class in economics 101 will teach that monopolies fundamentally decrease quality and in the long-term increase cost.

The introduction of Accountable Care Organizations is an intriguing idea on its surface; however, it will destroy medicine in the long term. The answer is not to make medicine bigger, but to make it smaller. We need to get back to the basics, we need to return to what is fundamental about the physician-patient relationship. And we must heed the warnings of our forefathers who warned us that this time would come:

If the people let government [or ACOs] decide what foods they eat and what medicines they take, their bodies will soon be in as sorry a state as are the souls of those who live under tyranny.” – Thomas Jefferson



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