Monday, December 12, 2011

In health care we don't need no stinking rule of law

The concept of rule of law at a minimal means clarity of laws and regulations and uniform enforcement.
Link
Consider the recent action of the Centers for Medicare and Medicaid (CMS) in regard to the imposition of pre-payment audits of certain procedures ( cardiac,joint replacements,spinal fusions)but only in certain states. See here.

This means that for these procedures hospitals will not be paid until government auditors review patient records and confirm that the procedure was "appropriate". How will that determination be made? What criteria will be applied to conclude that something was appropriate. Why does this only apply to NY,Texas,Florida,Michigan ,Ohio,North Carolina,Missouri and Pennsylvania? Uniform enforcement ? Clear Rules? According to CMS, some of the states have a high number of error or fraud cases while others just have a high volume of the procedures.

Rule of law fans have had little to cheer about since Obamacare was passed. The Secretary of HHS has issued exceptions to certain provisions of the law only to certain firms.See here for more on the waivers.

Dr.Wes has commented on the CMS plan suggesting that CMS may not actually have the expertise and organizational skills to render decisions in anything approaching a timely manner or to employ a rational evidence based decision making process. See here.

The blog "Secondhand Smoke" offered a commentary on Obamacare and its assault on the rule of law.

Richard Epstein has commented on Obamacare and Rule of Law. See Here.

Ambiguity in laws and regulations coupled with discretionary implementation are the friends of politicians and bureaucrats and the enemies of the rest of us.

Monday, December 05, 2011

Hayek's decades old comments as applied to Obamacare

See here for a posting on John Goodman's blog which features comments by Ed Feulner on how appropriate are FA Hayek's comments from Road to Serfdom are to how Obamacare is working.

Read the entire commentary but here is a flavor:

Hayek :"the legislative body will be reduced to choosing the persons who are to have practically absolute power."

Feulner :"Sound a bit like the Independent Payment Advisory Board (IPAB) of 15 unelected bureaucrats who will arbitrarily determine Medicare payment rates?"

Remember IPAB? See here to refresh memory of the power that this board of presidential appointees will have.

What could possibly go wrong with the IPAB? For those who seem to believe that government officials typically act in some nebulous "public interest"- nothing. For those who cynically think that people tend to respond to incentives and act in their own interests and believe that "regulatory capture" is real-a lot.

Obamacare is the prototypical progressive legislation.The progressive mindset is what Hayek talked about with his notion of the "fatal conceit".This is the belief that goverment will and should make the world better by social and economic planning and not by letting people free to coordinate their private plans.