Prior to its passage, I criticized GINA’s ban on employment discrimination in the National Law Journal for lacking a “direct threat” exception for public safety.  The Economist’s blog suggested its ban on insurance discrimination could fundamentally undermine insurance markets and the availability of private health insurance in the long run. 

Last month, Congress created a long-run threat to the insurance industry by passing the Genetic Information Non-Discrimination Act (GINA).  GINA also regulates employers in ways that I criticized in 2005 in the National Law Journal.

Quite apart from the fact that such legislation interferes with employers’ freedom of contract (is it really so unreasonable for a movie studio to cast a thin person rather than a fat person in certain roles, or for an airline to want a thin flight attendant who can move easily up and down the aisle and allow passengers to pass by rather than a fat flight attendant who will block the aisle?), it’s also not clear why such legislation should focus on fat people, who can often control their condition, rather than other people disadvantaged by mother nature, like short people.   (I became fat in 1993, but then lost the weight by eliminating alcohol, butter, and extremely fatty foods from my diet.  But short people cannot change the fact that they are short).

After all, most Americans are overweight, so it’s not as if fat people are a tiny minority.   And being fat is not as disadvantageous (at least for men) as being short.  For example, fat people of both sexes are more likely to get married than short men, and short people are less likely to get promotions than people of average height like me. 

A women’s studies professor quoted in the article supports fat discrimination legislation as a way of destigmatizing fatness.  (Some colleges now have “fat studies” programs, whose professors are often drawn from existing  women’s studies programs).  But even if that were truly possible, destigmatizing fatness might do more harm than good to public health.  In my wife’s native France, obesity rates are lower than in the U.S., and lifespans are longer (despite all the cheese, foie gras, and red meat they eat).  Part of the reason is that they simply eat less (not healthier).  Why do they eat less?  Partly due to the shame factor.  My French-born wife’s (thin) best friend told me, with disapproval, that in France, “it is a shame to be fat.”  Shame is not a pleasant emotion, but maybe it’s better to be shamed into losing weight than to be dead from obesity-related conditions, like diabetes, heart diseases, and weight-related cancers.  Those obesity-related conditions are a legitimate cause for concern for the insurers and employers who end up paying for them.

Last year, I criticized the GINA bill in the National Law Journal for lacking a “direct threat” exception that would allow employers not to use people with hazardous conditions (like a genetic tendency to seizures) for jobs where they could unintentionally cause harm to the public (like a person prone to seizures driving a bus).  Existing laws such as the Americans with Disabilities Act contain such an exception.  Greg Conko, who studies biotech law and policy, pointed out that there was no need for the GINA bill.  He noted there is no pattern of insurers or employers misusing genetic information.

But Congress is preparing to wreck the system.  At the behest of a congressional staffer-turned lobbyist, the House has voted to impose on HSAs much of the regulatory bureaucracy evident in health insurance.  Reports the Wall Street Journal:

Democrats have made affordable health care a mainstay of their election agenda, but apparently only if you’re willing to get insurance through the government. Witness their stealthy assault on Americans who prefer the private-sector option of Health Savings Accounts.

This week, the House passed legislation that included a provision to require every HSA transaction be reviewed and verified as a legitimate medical expense. Democrats say this is to ensure that consumers are using their tax-free withdrawals for a knee replacement, rather than a new iPod. In reality it adds a layer of bureaucracy that could sharply reduce the appeal and cost savings of HSAs.

A key player here is Ways and Means Health Subcommittee Chairman Pete Stark, whose main purpose in politics is to give the U.S. a government-run health-care system. He is a known opponent of HSAs – once comparing them to “weapons of mass destruction” – because they introduce more individual choice into the health-care marketplace.

Pushing for the provision was a company called Evolution Benefits, which has patented a system for the substantiation of health-care expenses. Evolution’s lobbyist, John McManus, was the former staff director of the Health Subcommittee under Republican Bill Thomas. The company first lobbied for the HSA provision, then withdrew its support when Republicans began to focus on its role. But Ways and Means Chairman Charlie Rangel helped make sure the provision was in the bill, which passed largely on partisan lines.

 Leave it to Congress to try to mess up a good thing. It makes you wonder if the politicians want to manufacture a real health care crisis, since it would increase their power.

He notes that paternalistic regulation to protect current borrowers will backfire against future borrowers, as it often does against consumers. (John Berlau discusses how a mortgage bailout will harm borrowers and the economy here, here, and here). McGovern points to how heavy state regulation of the health-insurance market makes health insurance coverage unaffordable for many uninsured people, because “many people can’t afford the gold-plated health plans that are the only options available in their states,” and because state insurance commissions forbid people to buy less expensive plans across state lines. (Eli Lehrer links to a solution to this problem that would benefit consumers with lower prices and more choices — Optional Federal Charter — here).

McGovern also notes that banning payday lending can backfire by forcing “people in need of immediate money” to pay for current expenses with money they don’t have through more costly means like “skipped credit card payments” and “bounced checks.” (John Berlau explains how payday lending bans can backfire against consumers here).

I agree with your criticisms of the about the problems with the Swedish health care system. But, of course, we have pretty much the same thing here. The government–through Medicaid, SCHIP, and occasionally Medicare–already provides health insurance to almost half of all children. Medicare “takes care” of all of the old and disabled. Many efforts to graft “private” features onto these programs–all of SCHIP and Medicare Advantage–can sometimes be worse than the pure-government programs that preceded them.

The Canadian Health care system, a bugbear to much of the Right, is not very different from the American system: it’s somewhat better for preventative care, somewhat less likely to waste money on MRIs for every broken bone, and somewhat worse at end-of-life care. Like the U.S. system, it’s made up of private doctors and private hospitals who get paid mostly by the government. There’s a little more political juice in the Canadian system (waiting lists disappear for the powerful) but, because its smaller and simpler, the Canadian government bureaucracy is generally less intrusive on the way that doctors practice day-to-day.

The U.S. does not have the world’s most free market health care system. Israel and Switzerland have health care systems that are significantly more free market than the U.S., cost less, and deliver better health outcomes. Canada and Switzerland, in fact, don’t try to centrally plan things like hospital locations the way that the U.S. does.

In the original sense of the word–collective ownership of the means of production– “health socialism” exists in only one G-8 country–the U.K. It is highly efficient in terms of health outcomes delivered per dollar spent. (I believe that’s absolutely the wrong way to measure health care but I think it’s still worth noting for people who want to focus on making Medicare “more efficient.”)

The real question isn’t trying to avoid government control–it’s too late for that–but, rather, trying to figure out how to get market forces back into the system.

Betsy McCaughey, New York’s former lieutenant governor, has an op ed today in The Wall Street Journal, in which she points out that mandatory health insurance is a ripoff for young people, and that it effectively forces them to subsidize the health care of older people. She also points out that many uninsured people are voluntarily uninsured, and that roughly half of the uninsured either have incomes above $75,000 per year, or are eligible for existing health-care programs like Medicaid if they would only sign up. For those who don’t have access to the Journal, her article is summarized here.