Friday, October 17, 2008

Shock! Free Gov't Healthcare Had Bad Incentives

This is just an AP article, but I think it illustrates well the problems with offering free healthcare to certain citizens who "need" it for free. The state of Hawaii quickly figured out that providing free health insurance for middle class children was a bad idea. This also proves that President Bush's reasons for vetoing the SCHIP expansion was completely accurate when he said that it would encourage those with coverage to drop it in favor of the cheaper government subsidized health care.

"People who were already able to afford health care began to stop paying for it so they could get it for free," said Dr. Kenny Fink, the administrator for Med-QUEST at the Department of Human Services. "I don't believe that was the intent of the program."

State health officials argued that most of the children enrolled in the universal child care program previously had private health insurance, indicating that it was helping those who didn't need it.

The universal health care system was free except for copays of $7 per office visit.

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