October 16, 2011
Recently, House Budget Committee Chairman Paul Ryan (R-WI) presented his views on the future of healthcare at Stanford’s Hoover Institution, reinforcing key themes of House Republicans’ Path to Prosperity. A video and transcript of his remarks can be found here.
In his address, Chairman Ryan argues that mounting public concern over the nation’s debt – coupled with skyrocketing healthcare costs – provides an opportunity to build on the House repeal of President Obama’s ill-conceived healthcare law with market-oriented, patient-centered reforms.
Here are some highlights from the speech (emphasis added):
- The urgent need to repeal and replace the President’s health-care law, coupled with the urgent need to deal with the drivers of our debt, will present us with an unavoidable time for choosing, allowing us to confront health-care inflation head-on.
- Simply put, badly designed government policies are to blame for much of what is wrong with health care today, and the solution is clear: We need to transition from the open-ended, defined-benefit approach of the past… to market-oriented, defined-contribution reforms that promote choice and competition.
- At its core, the health care problem is one of inflation, driven by the overutilization of services, dramatic underpayments, and massive inefficiency. If you look closely, the reason is easy to see: The health care sector lacks most of the basic building blocks of a functioning market. For one thing, markets require transparent prices, so that consumers can discover value. But in health care, the "consumer" is usually either a big insurance company, or the government. Health care providers have no incentive to provide transparent prices to their patients, because their patients don’t pay directly – it’s the government bureaucrat or the insurance company bureaucrat who pays the bills.
- So the disagreement isn’t really about the problem. It’s about how best to control costs in government health care programs. And if I could sum up that disagreement in a couple of sentences, I would say this: Our plan is to empower patients. Their plan is to empower bureaucrats.
- You cannot control costs by using price controls, which impose painful cuts within a fundamentally broken framework. Instead, you have to revisit the structure of federal health policy and change the incentives – something that many leading Democrats, with their unwavering commitment to early 20th Century social insurance models, remain totally unwilling to do.
- [W]e should not fear false attacks again in 2012. Fear and demagoguery are the last refuges of an intellectually bankrupt party – and the moment calls for leaders who are not afraid to be honest with people about how they would solve the problems we face.
- In health care, we owe the American people a defining choice, and that choice is: Who is in charge: The government or the patient?
For additional information, contact:
The House Republican Conference Policy Office