Is Obamacare a waste of money? Will more health insurance significantly improve people's health? Study suggests not.

The assumption behind the push for Obamacare and making sure millions of Americans had health insurance was the assumption it would improve health care and the ultimately the health of the uninsured.  A study out of Oregon suggests that's not the case.

Robert Samuelson reports on study of Medicaid patients who started getting health insurance versus those who didn't.  While they got more health care, though not dramatically (Uninsured people already receive health care.), they health didn't necessarily improve.

He writes:

Oregon's expansion of Medicaid -- the federal-state insurance for the poor -- unwittingly solved this problem. In 2008, the state decided to increase enrollment by 10,000. But there were 90,000 people on the waiting list, so the state adopted a lottery to decide who would receive coverage. The result was two similar groups of poor, one with insurance (Medicaid) and one without, that could be compared. The New England Journal of Medicine recently published the study.

The most overlooked finding is that the uninsured already receive considerable health care. On average, the uninsured had 5.5 office visits annually, used 1.8 prescription drugs and visited the emergency room once. Almost half (46 percent) said they "had a usual place of care" and 61 percent said they "received all needed care" in the past year. About three-quarters (78 percent) who received care judged it "of high quality." Health spending for them averaged $3,257.

True, when people were covered by Medicaid, many of these figures rose. The number of office visits went to 8.2; the number of drugs, 2.5; the share of patients with a usual place of care, 70 percent; the proportion receiving all needed care, 72 percent. Preventive care also increased. The share of patients receiving screening for cholesterol moved from 27 percent for the uninsured to 42 percent; the share of women over 50 having mammograms jumped from 29 percent to 59 percent; the share of men over 50 getting PSA tests for prostate cancer doubled from 21 percent to 41 percent. Spending rose to $4,429.

Unfortunately, the added care and cost didn't much improve people's physical health. The study screened for high blood pressure, high cholesterol, diabetes and the risk of a future heart attack or stroke. There were no major detected differences between the uninsured and Medicaid recipients. There was more treatment for diabetes, though no difference between the two groups on a key indicator of the disease.

 This is supported by a previous 2007 study of Medicare.

The Congressional Budget Office reported that the uninsured typically received 50 percent to 70 percent of the care of the insured. A study in 2007 of the 1965 creation of Medicare -- insurance for the elderly -- concluded that it had "no discernible impact on elderly mortality" in the first 10 years but improved recipients' financial security by limiting out-of-pocket expenses.

Samuelson takes Obamacare advocates to task:  "They were too busy flaunting their own moral superiority. Universal health insurance is a legitimate goal, but 2009 -- in the midst of a major economic crisis -- was the wrong time to pursue it. Predictably, it polarized public opinion and subverted confidence for what seem, based on the available evidence, modest likely public health improvements. The crusade for universal coverage has been as much about advocates' sense of self-worth as about benefits for the uninsured."

And the end result is likely wasting billions upon billions of dollars to implement another big government boondoggle.

Giving health care and retirement decisions back to individuals is both a racial and conservative idea.

The whole debate over health care bills in Congress is really a microcosm of the broader debate over the appropriate role for government in American society. Obama, who certainly has a more collectivist vision for the role of government, has run up against resistance from the American people who are concerned about expanding government control of health care and the cost. And the massively growing government debt and economic problems are also likely to act as a brake on other efforts to expand government control and involvment in other areas as well.

What's the alternative to this collectivist, nanny state vision? It's a return to individual responsibility and a more limited government. One person who's raising the standard for an alternative vision of government is Congressman Paul Ryan.

He wants to return control and responsibility for health care - Medicare and Medicaid - and retirement - Social Security- to individuals rather than letting the government continue to run the costs through the roof and lead these programs to the cliff of bankruptcy.

As Michael Gerson wrote in a column printed in today's Star Tribune:

The new era of Democratic bipartisanship, like cut flowers in a vase, wilted in less than a week. During his question time at the recent House Republican retreat, President Obama elevated Congressman and budget expert Paul Ryan, R-Wis., as a "sincere guy" whose budget blueprint -- which, according to the Congressional Budget Office (CBO), eventually achieves a balanced budget -- has "some ideas in there that I would agree with." Days later, Democratic legislators held a conference call to lambaste Ryan's plan as a vicious, voucherizing, privatizing assault on Social Security, Medicare and every nonmillionaire American. Progressive advocacy groups and liberal bloggers joined the jeering.

From a political perspective, Democratic leaders are right to single out Ryan for unkind attention. He is among their greatest, long-term threats. He possesses the appeal of a young Jack Kemp (for whom both Ryan and I once worked). Like Kemp, Ryan is aggressively likable, crackling with ideas and shockingly sincere.

But unlike Kemp -- who didn't give a rip for deficits, being focused exclusively on economic growth -- Ryan is the cheerful prophet of deficit doom. In a few weeks, he expects the CBO to report that, in the 10th year of Obama's budget, the federal government will "spend nearly a trillion dollars a year, just on interest! This traps us as a country. Inflation will wipe out savings and hurt people on fixed incomes. A plunging dollar will make goods more expensive. High tax rates will undermine economic growth. It is the path of national decline."

But unlike other deficit hawks, Ryan courageously -- some would say foolhardily -- presents his own alternative. His budget road map offers many proposals, but one big vision. Over time, Ryan concentrates government spending on the poor through means-tested programs, patching holes in the safety net while making entitlements more sustainable. He saves money by providing the middle class with defined-contribution benefits -- private retirement accounts and health vouchers -- that are more portable but less generous in the long run. And he expects a growing economy, liberated from debt and inflation, to provide more real gains for middle-class citizens than they lose from lower government benefits.

Ryanism is not only a technical solution to endless deficits; it represents an alternative political philosophy. Democrats have attempted to build a political constituency for the welfare state by expanding its provisions to larger and larger portions of the middle class. Ryan proposes a federal system that focuses on helping the poor, while encouraging the middle class to take more personal responsibility in a dynamic economy. It is the appeal of security vs. the appeal of independence and enterprise.

Both sides of this debate make serious arguments, rooted in differing visions of justice and freedom. But the advocates of security, including Obama, have a serious problem: They are currently on a path to economic ruin.

I think this is ultimately the way to go. Restore responsibility to individuals and view government as the last line of help for those in need rather than the first. For those who say people are unable or unwilling to take responsibility, one has to ask, has the government been successful in addressing these needs? I think not. Health care and retirement programs are seeing rising costs and approaching bankruptcy unless there are major changes.

What's interesting is this conservative plan is really the radical one. As Washington Post blogger Ezra Klein writes:

Paul Ryan's budget is a radical document that rolls a live grenade under current policy. Social Security? Ryan adds private accounts. Medicaid? Ryan privatizes it. Medicare? Same thing. Health care? Ryan repeals the subsidy for employer-provided insurance, replacing it with a tax credit. The boyish Ryan is a conservative darling, but there's nothing conservative about his document. It does not respect, much less preserve, the status quo. But then, that's a point in Ryan's favor. The status quo will bankrupt our country. On that, Ryan's radicalism is welcome, and all too rare.

In this respect, the conservative solution is the radical one while President Obama's approach is simply more of the status quo. Ryan's "roadmap" proposals can be found here.

Sign of things to come? Mayo stops treating some Medicare patients because government pays too little.

The Mayo Clinic in Arizona has stopped treating some Medicaid patients, because the government pays so little. I believe the Senate health care bill would cut hundreds of millions from government medical assistance programs, so we can expect more of the same.

According to Bloomberg news story:

The Mayo Clinic, praised by President Barack Obama as a national model for efficient health care, will stop accepting Medicare patients as of tomorrow at one of its primary-care clinics in Arizona, saying the U.S. government pays too little.

More than 3,000 patients eligible for Medicare, the government’s largest health-insurance program, will be forced to pay cash if they want to continue seeing their doctors at a Mayo family clinic in Glendale, northwest of Phoenix, said Michael Yardley, a Mayo spokesman. The decision, which Yardley called a two-year pilot project, won’t affect other Mayo facilities in Arizona, Florida and Minnesota.

Obama in June cited the nonprofit Rochester, Minnesota-based Mayo Clinic and the Cleveland Clinic in Ohio for offering “the highest quality care at costs well below the national norm.” Mayo’s move to drop Medicare patients may be copied by family doctors, some of whom have stopped accepting new patients from the program, said Lori Heim, president of the American Academy of Family Physicians, in a telephone interview yesterday.

“Many physicians have said, ‘I simply cannot afford to keep taking care of Medicare patients,’” said Heim, a family doctor who practices in Laurinburg, North Carolina. “If you truly know your business costs and you are losing money, it doesn’t make sense to do more of it.”

And Mayo has been losing money big time.

The Mayo organization had 3,700 staff physicians and scientists and treated 526,000 patients in 2008. It lost $840 million last year on Medicare, the government’s health program for the disabled and those 65 and older, Mayo spokeswoman Lynn Closway said.

Mayo’s hospital and four clinics in Arizona, including the Glendale facility, lost $120 million on Medicare patients last year, Yardley said. The program’s payments cover about 50 percent of the cost of treating elderly primary-care patients at the Glendale clinic, he said.

“We firmly believe that Medicare needs to be reformed,” Yardley said in a Dec. 23 e-mail. “It has been true for many years that Medicare payments no longer reflect the increasing cost of providing services for patients.”

Mayo will assess the financial effect of the decision in Glendale to drop Medicare patients “to see if it could have implications beyond Arizona,” he said.

And Mayo is not alone.

Nationwide, doctors made about 20 percent less for treating Medicare patients than they did caring for privately insured patients in 2007, a payment gap that has remained stable during the last decade, according to a March report by the Medicare Payment Advisory Commission, a panel that advises Congress on Medicare issues. Congress last week postponed for two months a 21.5 percent cut in Medicare reimbursements for doctors.

What will be the liberal, big government response? More government control and regulation and the attendant rationing to manage costs rather than allowing the market and individuals to determine costs. Economics 101.

Again, the primary reason health care in the US is mess is misguided government involvement through promising massive health care programs without any consideration of the costs of those programs. Sure, government has a regulatory role to play but more as an umpire than one dictating how each player should play.