IB-2001-F (September 2001)
Author: Linda Gorman
Transcript of a speech delivered by Linda Gorman at Putting Patients First, a health care symposium held Aug. 29th, 2001 in Evergreen, Colorado and sponsored by the Rocky Mountain Center for Health Care Policy, an affiliate of the Independence Institute.
Im here to tell you, since were quoting P.J. ORourke right now, he said that Giving more money to government was like giving teenage boys whiskey and car keys. And even though you work as hard as you can to make government programs work, there are certain reasons why they will not work no matter how you work, so were going to get a little lesson this morning in public choice economics.
But to start with I can, yes, give an example at the end of this talk of a drug that has indisputably, or a class of drugs, saved money in hospitalization costs. There are studies out there that do it so if the person who had that question, we can help you.
One of the things I find as I go around and talk about health care in this state, is Im still talking to a lot of people who think that the socialized systems where the government controls health care are still the best. And they really, what they usually will do to me is quote to me or for me, or to argue with me, is quote statistics on things that I think are very bad measures of how health systems in developed countries perform. The classic statistics that are quoted to you are infant mortality, OK? Well, what people dont know is that definitions of live births vary over different countries and so the number of babies born alive depends on where you are. So infant mortality is going to depend on where you are. A one-pound premature baby in some countries in Europe is not considered alive, its not counted. So when somebody quotes you infant mortality to say that the U.S. health care system is bad, ask them if theyve done it by birth weight categories. Other things that are used, our life expectancy, U.S. health care system gets beaten up: Oh, life expectancy is way too short compared to other countries and look how much we spend.
Well, a more useful measure is probably the number of years of useful life, because life expectancy depends on how many risks people take and it can be changed by behavior. Extremely promiscuous people may catch diseases that shorten their lives, people who like to bungee jump may shorten their lives, and so forth, and depending on your culture, youre going to get life expectancy that may change having nothing whatsoever to do with the medical care system. The other things consumer surveys, well, everybody in Canada likes their health care system, I saw a survey that said that 89% of the people thought it was great. Well, at any one time, only about four percent of the people in any given developed country have been in the hospital or needed sophisticated care. So consumer surveys of that kind are worthless, because people dont know what theyre talking about.
IB-2001-A (January 2001)
Author: Linda Gorman
House Bill 01-1108. Prescription Drug Fair Pricing Act. Creates a new state health insurance program that is not means tested. Makes the state a prescription drug wholesaler, politicizes prescription drug pricing, creates a new bureaucracy to act as a commercial middleman, gives the state full access to retail pharmacy business records, puts small bio-tech firms at risk by creating a new category of business crimes.
Synopsis: This bill creates a state health insurance program that is not means tested. It also creates a new set of business crimes. Any Colorado resident without prescription drug coverage would be eligible to participate. The bill does not specify whether the drugs covered under the major medical or stop loss provisions of many private health care plans would count as prescription drug coverage. It requires the state to maximize enrollment by eligible residents.
Any pharmaceutical manufacturer selling prescription drugs in Colorado through any state program would be required to agree to sell its prescription drugs to the state at prices negotiated by the Colorado Department of Health Care Policy and Financing. The difference between the list price and the negotiated price would be given to the state in the form of a cash rebate. The rebates would be put in the prescription program cash fund. The legislation lets the Department of Health Care Policy and Financing claim an annual management fee of one percent of the funds assets for expenses in 2001-02. After that, the monies in the fund would be removed from the control of the state treasurer and would be continuously appropriated to the executive director of the Colorado Department of Health Care Policy and Financing. Though this program represents a potentially huge new entitlement, there is no language stipulating that the programs costs cannot exceed the amount of rebates collected.
All retail pharmacies licensed by the state must sell prescription drugs to program participants at prices determined by the Colorado Department of Health Care Policy and Financing. The state will give the pharmacies a $3.00 professional fee for each prescription handled. The pharmacies will recoup the difference between the list price they pay and the mandated state price by filing claims. The bill requires the state to reimburse them on a weekly or biweekly basis. There is no provision for reimbursing pharmacies for the interest lost on their funds while waiting for rebate payments. The bill would make it legal for the Department to collect from the retail pharmacies any utilization data necessary to calculate rebates and require it to keep only trade secrets, work product, or proprietary information confidential.
If after all of the paperwork has been processed discrepancies between the rebate paid and the rebate claimed still exist, the state or the manufacturer must hire a mutually agreed upon independent auditor. If the auditor cannot resolve the discrepancy the side owing the money has to justify why the discrepancy exists within sixty days. If agreement still cannot be reached, a lawsuit may be filed before the district court of the City and County of Denver. No provision is made for reimbursing either side for the cost of funds tied up for the 60-day period.
IB-1999-A (June 1999)
Author: Linda Gorman
Summary: House Bill 1103 bill assumes that parents do not sufficiently protect their children against the risk of cycling head injuries. It would replace parental decisions about appropriate risk with a government rule that would fine the parents of children who do not wear bicycle helmets when cycling.
What the Bill Does: Parents of anyone under 16 years of age who is operating or riding a bicycle on a public roadway, bicycle lane, or bicycle path and who is not wearing an approved bicycle helmet as the helmet was designed to be worn would be at fault. They will be cited for a class B traffic infraction with a minimum of a $15 fine.
Parents who knowingly allow their children to ride without a helmet also commit the offense of endangering a bicyclist. The bill also allows the Department of Public Safety to establish a statewide bicycle helmet education program to reduce bicycle-related injuries and fatalities.
People whose religion frowns on helmet use are exempt from this law.
Studies of bicycle-crash admissions to trauma centers suggest that bicycle helmets reduce the severity of head injuries. Those who want national helmet laws for children have used these data to conclude that up to 184 pediatric deaths a year could be prevented if children were required to wear helmets.1 Their assumption is that helmet laws will increase helmet use and thus reduce head injuries.
But use by itself does not confer health benefits and these estimates almost certainly overstate the benefits of helmets. Helmet wearers are a self-selected group. As a group, they may tend to ride their bicycles more safely and may end up in trauma wards less often simply because safer riding means fewer crashes. This point was made quite clearly by the authors of an epidemiological study of the 2,333 children aged 0 to 14 who ended up in U.S. trauma centers as a result of bicycle accidents during 1989 through 1992. Although they urged an increase in helmet use, the researchers noted that special attention should be paid to high-risk groups, such as children with mental disorders and children who are likely to ride in traffic 2 as these factors also increased the risk of head injuries.
Survey data from Australia suggest that the greatest effect of helmet laws is to discourage cycling. 3 Cycling by children fell by a third in the two years after the mandatory law was passed. Estimates of the benefits of cycling outweigh its risks by about 20 to 1, even without helmets. This means that helmet laws are more likely to degrade public health than improve it. (According to D.L. Robinson of the University of New England, Armidale, Australia, the risk of dying of head injury per hours is similar for unhelmeted cyclists and motor vehicle occupants. Requiring mandatory helmets for motor vehicle occupants has the potential to save 17 times as many people from death by head injury…without the adverse effects of discouraging a healthy and pollution free mode of transport.4
Helmet laws may also have a lower than expected effect on serious injury rates because those most likely to be injured also are most likely to flout the law, and because people who feel safer often engage in riskier behavior. This is an important consideration given that an estimated half of pediatric injuries are the result of bicycle-motor vehicle collisions and the cyclist is usually at fault. The experience with child-proof aspirin bottles is a case in point. The caps were supposed to reduce poisoning deaths. In fact they did not, apparently because people were less careful about storing the bottles out of the reach of children.
Health effects aside, the real question here is whether or not the state believes that parents should have the primary responsibility for raising children. If it does, it has no business micromanaging something with a risk as low as riding a bicycle without a helmet. Parents must routinely balance risks that lawmakers never even think of. A school-hating child is perfectly capable of figuring out that losing his helmet at the last minute means that he can miss some school. A parent alert to the dodge would probably decide that making the point that losing ones things is no excuse for missing school is more important than the (slight) increase in the risk of injury from riding a bicycle without a helmet. The child would be shoved out the door and off to school without a helmet. Should the state ticket or reward such discernment?
This law also erodes parental authority by giving children another way to threaten parents with the state. To the standard if you make me do that Ill call child protective services threat can now be added the if you do that Ill ride without my helmet, say you said it was o.k., and get you fined. Furthermore, it is just plain silly to say that parents who knowingly allow their children to ride without a helmet are guilty of commit[ing] the offense of endangering a bicyclist. Failing to reduce an already small risk is not the same as endangering someone. Whats next? Accusations of child abuse when kids ride without helmets?
Perhaps the ultimate irony is that this kind of law forces people on tight budgets to spend money on helmets when their kids might benefit more from another kind of expenditure. The irony is that Colorado currently requires insurers to pay for mammograms under the theory that women might not be able to afford the $70.00 cost. If the state has determined that families cant afford $70.00 every few years for a mammogram, why is it forcing them to lay out $30.00 a kid for bicycle helmets?
Look for helmet subsidy programs next year.
Linda Gorman, Senior Fellow, Independence Institute
1Soisin DM, Sacks JJ, Webb KW. “Pediatric head injuries and deaths from bicycling in the United States.” Pediatrics 1996 Nov;98(5):868-70.
2Li G, Baker SP, Fowler C, DiScala C. “Factors related to the presence of head injury in bicycle-related pediatric trauma patients.” J Trauma 1995 Jun; 38(6):871-5.
3Finch CF, Heinman L, Neiger D. Bicycle use and helmet wearing rates in Melbourne, 1987 to 1992: the influence of the helmet wearing law. Melbourne: Monash University Accident Research Centre, 1993. (Report no 45.)
4Robinson DL. “Head injuries and bicycle helmet laws.” Accid Anal Prev 1996 Jul;28(4):463-75
IB-1999-A (March 1999)
Author: Linda Gorman
Synopsis: This bill allows a state task force to receive private funding. It is a trojan horse to allow the Robert Wood Johnson Foundation to push for socialized medicine and various nanny state schemes. The bill is antithetical to the principle that government activities should be paid for (and therefore controlled by) the legislature.
What the Bill Does: This bill creates the Colorado Health Care Task Force consisting of 9 members of the general assembly, 5 from the House of Representatives, and 4 from the Senate. The Speaker of the House and the President of the Senate make the appointments. Members may serve for 2 consecutive terms of 1 year. The task force must meet at least 4 times per year.
Members may appoint subcommittees. The members of the subcommittees will not be paid. Subcommittee members should be chosen from the usual suspectshealth care providers of various stripes, employers of various sizes, hospitals, managed care insurers, HMOs, community activists involved in health issues, and bureaucrats from the Department of Public Health and Environment, and the Division of Insurance.
All task force costs will be reimbursed despite the fact that there will be no legislative appropriation. This is possible because the bill specifically states that the task force may accept and spend “federal funds, grants, gifts, and donations” for purposes of the task forces activities.