Today's Expensive Health Care Is Tomorrow's Necessity

When we consider the cars we drive, the mobile phones we talk on morning, noon and night, and the computers most of us couldn't function without--all were once inaccessible luxury items to the average American. Though today all three are available to nearly all income classes in the U.S., there was a time when they were primarily the baubles of the rich.

While the subject of health care has been debated by all sides to death--with no resolution--it's fair to suggest that whichever side commentators found themselves on, they tended to agree that health care and the insurance meant to pay for it are too expensive.

History says that those who wring their hands over cost put the cart before the proverbial horse. High prices have historically been a market positive for predicting low prices for those same goods and services in the future.

Indeed, as the great Austrian School economist Ludwig Von Mises long ago observed in his classic book Liberalism, "The luxury of today is the necessity of tomorrow." By that Von Mises meant that the lifestyles of the rich and famous frequently predict how the non-rich among us will live in the future.

In that sense, the notion of automobiles for the masses was once a distant object until Henry Ford applied the all important division of labor to car manufacturing. Soon enough, Americans well down the nation's income scale were driving cars. Looked at in terms of today, the quite pedestrian Ford Taurus has more high-performance gadgetry on its dashboard than luxury Mercedes autos could claim back in the 1980s and '90s.

Author’s point :

The beauty of today’s Cadillac plans has to do with them covering all manner of obscure, and quite expensive, medical procedures. Rather than taxing them out of existence, the goal there should be to free-ride the high bar they set in terms of insurance quality and medical services offered. To the extent that Cadillac plans redound to the profitability of insurance firms, the long-term result will be new entrants into the high-end space seeking to capture those same profits, and in doing so, bring the cost of what is now expensive coverage more in line with market realities. Profits are what attract competition, so when Washington’s stated goal is to reduce profits in the sector, what it’s really doing is driving out competition meant to serve us all at a lower price.

I'm not sure this observation works.

If an automobile must be handcrafted, then only the rich will have cars.
When Henry Ford figures out the assembly-line, then cars can be produced for the masses.
Fine.

When a brain surgeon makes $500,000 a year because he is uncommonly well-educated and uncommonly skilled at his profession, then I do not see how your local college can start churning out dozens of brain surgeons each year, thereby bringing down the price -- Brain surgeon?? Well, salaries top out at $80,000 these days ...

No. Much of health care is expensive because it's performed by very special people. I don't see that changing, and I don't see it getting cheaper.

The health care that Ted Kennedy received was darn good -- you're not going to get that level of care unless you are very rich. Obamacare isn't going to give it to you "on the cheap".

All of those products were subject to free market and competition. People were free to choose for themselves what brand to spend their hard-earned money on, if any at all. It was the flow of private money that eventually brought the price down.
The gov't just took that incentive away with the Health Control bill. When something becomes mandatory, the price goes up. With a monopoly even more so. Thanks to extensive regulation and mandates, coupled with the prohibition on profits, we will now have to wait many more decades for the futuristic health care technology we all wish we had.

When we consider the cars we drive, the mobile phones we talk on morning, noon and night, and the computers most of us couldn't function without--all were once inaccessible luxury items

The other side of that coin is that many things we have now, are really frills. How many people "couldn't function without" being able to watch TV on a bus, taking a picture of a dog in a funny sweater to show your friend across the country right now, airbags, fifteen different slightly different variations of ranch dressing by Hidden Valley alone, etc.

Is there a profitable market for “non-frills” products ? That is, a bus that does not have TV ?

I think there would be for certain income segments.

I was thinking more of people on a bus watching TV on their cell phones.

My point is that the author wants everybody to be happy about having a super duper health plan now, because it will get cheaper over time, but a lot of us don't need (but will have to pay for) the one size fits all health plan that the government will demand everybody provide, and that's wrong.

I can point and laugh at somebody paying 99c per month per ringtone because I don't have to blow my money that way. But men don't need insurance for maternity leave, 20-year-olds don't need insurance for prostate cancer, nobody needs acupuncture or abortion to be paid for by insurance, etc., but everybody will have to pay for it.

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