A story in the Honolulu Star-Bulletin on Tuesday May 16, 2006, about doctors abandoning practice in Hawaii is disturbing to say the least. It is yet another example of how government regulations and bureaucracy do more damage than they do good. The end result will be a doctor shortage in these fair islands.

The article reports doctors as saying, “Government reimbursements far below costs of caring for Medicare, Medicaid and QUEST patients coupled with medical malpractice costs are driving specialists out of Hawaii.” Other than doctors, when is anyone in business expected to provide services at prices well below what it costs to provide them?

The fact that healthcare is not, and can never be, a perfect science combined with the penchant for juries to award staggering sums in awards for conditions beyond a physicians control has led the liability crisis. The ever expanding public financing of healthcare via Medicare, Medicaid and, in this state, QUEST means that as these programs attract ever more participants, government will find it increasingly impossible to fund them. Thus reimbursements will continue to shrink.

The article paints a dire picture. Healthcare Association of Hawaii President and Chief Executive Officer Richard Meiers is quoted as saying, “Hawaii's health care system, as we have known it, is rapidly disintegrating." But other observations paint a clearer picture of the story.

Dr. Terry Smith, featured in the story said, “They are air-evacuating people now with broken fingers” because of the lack of orthopedic surgeons on the neighbor islands.” This is staggering to contemplate. If this doesn’t scream “crisis” then what does?

Smith is going to give up his practice here on the islands for temporary assignments on the mainland. His airfare and all his living and associated expenses, including malpractice insurance, will be paid for by the company but he will continue to live here, “I can make more money with less hours by working on the mainland and flying to and from here."

Getting government involved in the health-care decisions and reimbursement has proven to be one of greatest blunders in our modern era. President Bush’s drastic expansion of the prescription drug facet of Medicare will prove to be a tragic mistake. The system is simply not sustainable and will lead to a severe budget crisis in the foreseeable future.

The litany in the article goes on and is far too extensive to recount here but at the heart of the problem is the now universally accepted idea that government, or insurance companies, or anyone but the patient him or herself should pay for that patient’s healthcare. This is the real result of the Medicare “experiment” and few are willing to admit that or that it has failed.

The high cost of healthcare is a direct result of the low reimbursement rate by government programs, which the insurance companies try their best to match. So the people who aren’t covered by these programs are charged at a level to make up the difference. This is the real source of the “$5 aspirin” and other such hospital scandal stories. How much must a hospital be losing in Medicare and Medicaid payments to try to make it up charging other customers $5 for an aspirin?

While our state legislators were content to play with tinkering with gasoline prices and whether there should be any residential housing in Kakaako makai, a real crisis has been brewing that they have completely ignored. Only when the crisis is fully upon us will they then turn their attention to the problem and at that point it will cost far more money and take much more effort to fix.

No doubt the majority of our elected officials will advocate more the same kind of solutions that got us into this mess, namely more government involvement. Having not learned the lesson in the past there is little doubt they will learn it in the future. As the old saying goes, “Nothing succeeds like failure.”

Reference:

http://starbulletin.com/2006/05/16/news/story04.html

Don Newman, senior policy analyst for the Grassroot Institute of Hawaii, Hawaii's first and can be contacted at: mailto:don@grassrootinstitute.org