Federal Price Setting? – Commentary by Frank Gillispie 2/25/10
"The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively,
or to the people." --Tenth Amendment to the U.S. Constitution
I was sitting at my desk writing out checks to various doctors, clinics, medical labs and agencies for my co-pays, deductibles, and insurance premiums
when I heard a discussion on one of the morning news programs about President Obama’s newest health proposals. He was suggesting a program that allows
federal bureaucrats to review any premium increases by insurance companies. My first reaction was “that might be a good idea.” But then I started to
think about it and changed my mind.
Every state has an insurance commissioner who is responsible for reviewing and approving or rejecting rate increases. We have a Madison County resident,
State Sen. Ralph Hudgens, who is running for Georgia Insurance Commissioner in the fall elections. So any new federal agency dedicated to this cause
would, once again, be taking away state responsibilities.
I realized as well that a federal office would try to force national standards on insurance rates. Again, sounds like a good idea until you realize
that the cost of doing business varies widely between the states. Real estate, energy and labor cost in California, for example, are much higher than
those in Georgia. Therefore, a federal ruling reducing rates in California might have the effect of increasing them in Georgia.
In addition, I can find nothing in the Constitution that allows the federal government to set prices within state borders. Such a bill, in my opinion
would violate the tenth amendment.
But there is one way it can legally be done. That is to pass the Republican plan to allow people to buy insurance across state borders. In that case,
insurance rates would legally fall under the interstate commerce clause and federal price controls would be legal.
Then my mind turned to the idea of opening up the state borders so that people can buy insurance from any state in the union. That would greatly
increase the competitive nature of health insurance. People in the high rate states, like California, New Jersey and others could save a considerable
amount of money that way.
But then insurance companies in those states would be forced to reduce their rates in order to compete with the out of state companies, and might very
well find that they are not able to stay in business with lower rates.
I have a confession to make. I am not as smart as some of my fans think I am. (Nor as dumb as some of my critics say.) I have no idea which is the
better plan. But neither do the members of Congress. That is why the health care debate is so confusing. Perhaps the states should allow more
companies to function within their borders to increase competition. But Congress does not have constitutional power to require that.
That might be a good question to ask the candidates for Insurance Commissioner. Maybe one of them has the answer.
Copyright © 2010 by Frank Gillispie
email@example.com, Hull, GA
The American Ideal of 1776: The Twelve Basic American Principles
Like this? SIGN UP now
for weekly email updates in your inbox !!
Contribute now to help us maintain this website and carry on our mission!
"How fun! Those of us who remember the 1970s recall the frolics sparked by America's last great experiment with widespread price caps - namely, those on
oil and natural gas. The resulting short supplies gave us the thrill of waiting in long lines - and sometimes even getting into fistfights - for the
privilege of buying a few gallons of gasoline...
What cool adventures await us if Mr. Obama succeeds in giving Uncle Sam power to control insurance rates? Reduced coverage? Hidden fees aimed at
skirting government regulations? Surly service? More trouble and delays collecting on our policies?"
--Don Boudreax, economist, George Mason University
"[Healthcare price controls will be ] carried out by a new health care bureaucracy, the “Health Insurance Rate Authority,” comprised of seven “experts” who
will decide what insurance companies can charge for their policies....In other words, this soviet-style central planning committee will busy itself setting
price caps. For anyone who hasn’t taken Econ 101, price controls always (as in every stinking time) lead to shortages." --healthcarebs.com, from
OBAMA PROPOSES NEW BUREAUCRACY TO IMPOSE
PRICE CONTROLS ON INSURANCE, 2/22/2010
"When Congress creates a miracle for one American, it creates a non-miracle for another. After that, Congress has to create a compensatory miracle. Many
years ago, I used to testify before Congress, something I refuse to do now. At several of the hearings, I urged Congress to get out of the miracle
business and leave miracle making up to God."
--Walter E. Williams, from "Modern Day Lunacy", 2009
Frank Gillispie Online - frankgillispie.com
Give the Gift of Knowledge - Frank Gillispie, 12/16/09
Climate Fraud Shows Government is the Problem - Frank Gillispie, 12/3/09
Confessions of a Bibliophile - Frank Gillispie, 6/05/07
Rebirth of State Sovereignty - Frank Gillispie, 8/16/09
Partisan Hatred and Intolerance - Frank Gillispie, 9/03/09
Tea Party - Frank Gillispie, 3/26/09
Order a Tombstone for the Republic - Frank Gillispie
We failed to keep it - Frank Gillispie
Ignoring History invites Repetition - Frank Gillispie
Resisting Tax Tyranny - Frank Gillispie
The Perils of Democracy, Part 5 - J.A. Davis & Steve Scroggins
Doomed to repeat? - Frank Gillispie
How to Make a Slave - Frank Gillispie
American Closing her Door to Freedom - Douglas Young
Partisan Hypocrisy - Steve Scroggins
Secular Political Fanatics - Douglas Young
Liberty Lost part 8 - J.A. Davis
The New Slave Traders - Steve Scroggins
Slavery, Apologies & Duty - Steve Scroggins
Founding Wisdom - Frank Gillispie
Copyright © 2003-2012, GeorgiaHeritageCouncil.org
Georgia Heritage Council | 2121 Hollywood RD
Atlanta, GA 30318