Steve Hofman: Amendment 69 would make bad system worse
In Paul Hebert’s letter (9/17/16) supporting a “yes” vote on Amendment 69, the proposed constitutional amendment creating America’s only statewide health care entitlement, his closing words, “operational and policy adjustments can be made in implementation,” ironically summarizes the best case in favor of a vote against this far-reaching and radical plan.
As a former policy maker at the federal level, I have watched fearfully how time after time, government, at the urging of advocates for this or that point of view, has enacted legislation and regulations with the idea that if they don’t perform as advertised, one should not worry, they can always be fixed. From such mouths, to God’s ears.
What are some of the likely “adjustments” if this amendment becomes law?
Let’s start with needing to fix a dramatic decline in quality and medical access.
Why do I suggest this will occur? The amendment creates a 21-member board that is mandated to set prices for all medical services in the state. In short, price controls. The history of price controls has demonstrated repeatedly that such policies produce product and service shortages and reduced quality as the best providers of such services, in this case the best doctors and other health care professionals, relocate to communities that do not impose artificial ceilings on the value of their labor.
Proponents of Amendment 69 will readily say that is not their intention. But as sure as the sun rises, that is what will result.
A second adjustment will require the state to figure out how not to become a magnet for every sick American seeking free health care. Are we going to deny care in our emergency rooms, hospitals and doctors’ offices to those who can drive, fly or hitch a ride into the state. I think not.
At this point, the amendment defines a beneficiary as an “individual whose primary residence is in Colorado.” Transients or temporary residents seeking medical care will not be so dumb as to hang a “just visiting” sign around their necks. Free health care in Colorado will become the 21st century’s California Gold Rush, but this time on steroids.
This, of course, brings us to the multi-billion dollar question. How are we going to pay for all this? The amendment mandates a total taxation level of 10 percent on all forms of income, including non-payroll income. That raises the state’s total level of income taxation right to the top of the list of high tax states.
The amendment also gives the 21-member board the authority to raise taxes if program revenue proves insufficient, as it inevitably will as free services attract excessive use. In effect, the amendment creates a second state legislature. Isn’t one legislature already enough?
The best of our medical professionals will not be alone in heading for the exits. We can also say goodbye to those high income-earning residents Amendment 69 supporters envision funding a good portion of the state’s new health budget. I’ve had countless conversations with many location-neutral professionals like myself who love being in Colorado but do not see it as their only option.
The same can be said of many businesses that can find acceptable alternatives in states with lower tax burdens. And while some businesses will see their costs go down not having to pay for their employees’ health care insurance, many other businesses, generally smaller ones with tighter profit margins, will see their compensation costs explode.
Is it possible to make a bad system worse? That is what Amendment 69 would do. We can do better and that starts with rejecting a proposal that even supporters admit would need to be rewritten moments after being enacted into law.
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