The other Republicans' health care plan

California State GOP caucus offers a more market-based approach than the governor's

California Senate Republicans have unveiled an appealing plan to improve the availability and affordability of health care for all residents without imposing new taxes or forcing businesses or individuals to buy or provide anything. The plan announced Tuesday by the Senate Republican Caucus relies heavily on tax incentives for individuals, employers and health care providers, and on redistributing existing funds to improve health care coverage for children and the uninsured. Republicans claim their plan would provide "bare bones" health care for 3 million of the 6 million Californians now lacking insurance.

So far this year, Republicans have offered both carrot and stick incentives for improving health care. Republican Gov. Arnold Schwarzenegger's plan wields the stick - mandates, taxes and fees - while Senate Republicans now extend the carrot - tax breaks, loosened regulations and no new taxes. Also unlike the governor's plan, the Republican Caucus doesn't want to pay for illegal immigrants' health care. Instead, the plan would send the federal government a bill for $2.2 billion, "the cost of providing federally mandated health care services to illegal immigrants." That tab might be hard to collect.

However, there is much to like about the Republican Caucus' plan, which is dubbed, Cal CARE, an acronym for "comprehensive, affordable, responsible, effective." Cal CARE appears to be fairly comprehensive and might achieve affordability if its tax incentives and loosened regulations bring down costs as envisioned. The plan certainly is responsible since it leaves in the hands of individuals rather than the state the task of obtaining and paying for insurance and health care.

One of its most promising aspects is the proposed change in state regulations to allow health plans and insurers more flexibility in co-payments, deductibles and in modifying state mandates regarding health insurance benefits. If Republicans can pull that off, consumer choice will be greatly enhanced, and costs should drop accordingly.

Whether the plan will be effective, however, depends on the details. And considering the Democrat Party's dominance in Sacramento, making Cal CARE a reality could be a long shot. The Republicans propose that at least one part of the plan - redirecting tobacco taxes to children's health - be decided by voters through a ballot initiative.

The legislative parts of Cal CARE just might work if Republicans can communicate their message to build broad enough public support, which sometimes can influence even Democrat legislators. Unfortunately, it's a complicated message. (In that regard, it's also unlike the governor's plan, which by comparison is easily understood. With its mandates, costs and taxes, it's abundantly clear the governor's plan hurts just about everyone, employers and employees, providers and insurers.)

The Republican Caucus' plan doesn't have nearly as many negatives, but it's also a confusing myriad of spending reallocations, targeted employer incentives, budget priority shuffling, low-interest loans, tax credits, regulatory changes and ever-vague concepts like, "expansion of more affordable health coverage products available for consumers." There's also the matter of cost. Unlike the Schwarzenegger plan's $12 billion price tag, Senate Republicans claim no "out-of-pocket expenses." But it's unclear what the cost will be to increase Medi-Cal reimbursement rates, as the caucus desires. A large portion of the caucus plan relies on reallocating existing funds, for example, to expand primary-care clinics and provide care for children. However, the plan doesn't identify how much tax revenue will be lost by providing "the same tax benefit" to employees currently enjoyed by employers. We're anxious to see whether it will be the devil that is in the details, or something more pleasing.

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TIBOR MACHAN ON SCHWARZENEGGERISM

Several years ago Arnold Schwarzenegger seemed to have embraced the libertarian thinking of the late Milton Friedman. He even contributed some work to Friedman's famous TV program, Free To Choose, although I cannot recall exactly what that amounted to-an introduction to the DVD version or something.

I never had much hope for Arnie even back then because he never came right out and gave any clear statement of his political thinking. Moreover, although I am weary of reading people from afar, there were signs afoot suggesting that what Arnold Schwarzenegger is most interested in is being liked! Take, for example, the name he gave his famous restaurant in Santa Monica, "Schatzi." In German it means "little treasure" and is used mainly as a term of endearment toward someone one likes very much-"Mein Schatzi" or "My little treasure."

When someone is a political powerhouse but there is no real clue to what principles guide his or her conduct, it is difficult to tell what policies he or she is likely to support and oppose. That is when one is tempted to look to other factors to understand and explain the person, and this seems to be called for in the case of the current California governor. No one has a clue as to what he believes, what general ideas he adheres to, what his overall vision is. So then perhaps gaining a clue from his favorite German term is fair game.

But there is more. Consider that his massive spending plan, including the out and out socialist idea of universal health insurance to be paid for by the government, does not call for any rise in taxes. Instead he wants to pay for it by way of floating bonds, which is to say transferring the cost to members of future generations. What is noteworthy about this is that those members do not vote, they aren't even alive yet, so they aren't going to be angry at the gov much. And the current citizens of California will be able to continue the status of recipients of apparently free goods, delivered to them by their little treasure. He will, it seems, continue to be liked since the burden of his ill founded ideas will fall on people he will not have to face.

There used to be a famous slogan about taxation-there should be none without representation. Not quite what I would defend but better than how taxes were dealt with in the feudal past-more democratic, which is some progress. But now, as logic would suggest, politicians have become so habituated to promising and trying to deliver "free" goods they need not account for that they are willing to abandon the idea completely. Instead, "Let's just charge it, so the voters will not have to experience the cost of their benefits."

I, as did the governor, came to America as a refugee, only not from Austria but communist Hungary where health care was provided to all-in dreadful shape, of course, as anything that costs nothing much must be. It was also peddled with the sentimentalist notion that everyone is owed it, which is a crock. Many people don't want health insurance-I personally know quite a few such people. They'd rather save up for emergencies and do other things with money left over. And some simply haven't managed to come to afford health insurance, just as they haven't many other things they want and even need. None of this justifies having the likes of Arnold spread the cost on people who did make the needed effort to afford health insurance. And the idea that some are coerced to pay for the health care of others is criminal!

This dream of universal health insurance is no different from a dream of, say, universal fine dining or splendid vacationing or exquisite leather shoes. Health care workers need to be paid and the money doesn't grow on trees, so if those who receive the benefits will not pay, someone else must either voluntarily help out or be made to do so. The last is exactly as the communist viewed the situation. Maybe we ought to get a governor who really opposes tyranny, no matter what the excuse.

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For greatest efficiency, lowest cost and maximum choice, ALL hospitals and health insurance schemes should be privately owned and run -- with government-paid vouchers for the very poor and minimal regulation. Both Australia and Sweden have large private sector health systems with government reimbursement for privately-provided services so can a purely private system with some level of government reimbursement or insurance for the poor be so hard to do?

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