Health Care Reform – Full Article
by John Mackey, August 14, 2009 | Permalink
As you are probably aware, I wrote an Op/Ed piece that was published in the Wall Street Journal earlier this week on health care reform, one of the biggest and most emotional issues facing our country. I was asked to write an Op/Ed piece and I gave my personal opinions. While I am in favor of health care reform, Whole Foods Market as a company has no official position on the issue.
In answer to President Obama’s invitation to all Americans to put forward constructive ideas for reforming our health care system, I wrote this Op/Ed piece called simply “Health Care Reform.” An editor at the Journal rewrote the headline to call it “Whole Foods Alternative to Obamacare,” which led to antagonistic feelings by many. That was not my intention – in fact, I do not mention the President at all in this piece.
I fully realize that there are many opinions on the healthcare debate, including inside my own company. As we, as a nation, continue to discuss this, I am hopeful that both sides can do so in a civil manner that will lead to positive change for all concerned. You are welcome to share your thoughts in the comments section below. (Just remember our comment guidelines prohibit vulgarity and personal attacks.)
Here is the original unedited version that I submitted.
Health Care Reform
“The problem with socialism is that eventually you run out of other people’s money”-Margaret Thatcher.
With a projected $1.8 trillion deficit for 2009, several trillions more in deficits projected over the next decade, and with both Medicare and Social Security entitlement spending about to ratchet up several notches over the next 15 years as Baby Boomers become eligible for both, we are rapidly running out of other people’s money. These deficits are simply not sustainable and they are either going to result in unprecedented new taxes and inflation or they will bankrupt us.
While we clearly need health care reform, the last thing our country needs is a massive new health care entitlement that will create hundreds of billions of dollars of new unfunded deficits and moves us much closer to a complete governmental takeover of our health care system. Instead, we should be trying to achieve reforms by moving in the exact opposite direction-toward less governmental control and more individual empowerment. Here are eight reforms that would greatly lower the cost of health care for everyone:
1. Remove the legal obstacles which slow the creation of high deductible health insurance plans and Health Savings Accounts. The combination of high deductible health insurance and Health Savings Accounts is one solution that could solve many of our health care problems. For example, Whole Foods Market pays 100% of the premiums for all our team members who work 30 hours or more per week (about 89% of all team members) for our high deductible health insurance plan, and provides up to $1,800 per year in additional health care dollars through deposits into their own Personal Wellness Accounts to spend as they choose on their own health and wellness. Money not spent in one year rolls over to the next and grows over time. Our team members therefore spend their own health care dollars until the annual deductible is covered (about $2,500) and the insurance plan kicks in. This creates incentives to spend the first $2,500 more carefully. Our plan’s costs are much lower than typical health insurance, while providing a very high degree of team member satisfaction.
2. Change the tax laws so that that employer-provided health insurance and individually owned health insurance have exactly the same tax benefits. Right now employer health insurance benefits are fully tax deductible for employers but private health insurance is not. This is unfair.
3. Repeal all state laws which prevent insurance companies from competing across state lines. We should all have the legal right to purchase health insurance from any insurance company in any state and we should be able use that health insurance wherever we live. Health insurance should be portable everywhere.
4. Repeal all government mandates regarding what insurance companies must cover. These mandates have increased the cost of health insurance many billions of dollars. What is insured and what is not insured should be determined by individual health insurance customer preferences and not through special interest lobbying.
5. Enact tort reform to end the ruinous lawsuits that force doctors into paying insurance costs of hundreds of thousands of dollars per year. These costs are ultimately being passed back to us through much higher prices for health care.
6. Make health care costs transparent so that consumers will understand what health care treatments cost. How many people know what their last doctor’s visit cost? What other goods or services do we as consumers buy without knowing how much they will cost us? We need a system where people can compare and contrast costs and services.
7. Enact Medicare reform: we need to face up to the actuarial fact that Medicare is heading towards bankruptcy and move towards greater patient empowerment and responsibility.
8. Permit individuals to make voluntary tax deductible donations on their IRS tax forms to help the millions of people who have no insurance and aren’t covered by Medicare, Medicaid, SCHIP or any other government program.
Many promoters of health care reform believe that people have an intrinsic ethical right to health care-to universal and equal access to doctors, medicines, and hospitals. While all of us can empathize with those who are sick, how can we say that all people have any more of an intrinsic right to health care than they have an intrinsic right to food, clothing, owning their own homes, a car or a personal computer? Health care is a service which we all need at some point in our lives, but just like food, clothing, and shelter it is best provided through voluntary and mutually-beneficial market exchanges rather than through government mandates. A careful reading of both The Declaration of Independence and the Constitution will not reveal any intrinsic right to health care, food or shelter, because there isn’t any. This “right” has never existed in America.
Even in countries such as Canada and the U.K., there is no intrinsic right to health care. Rather, citizens in these countries are told by governmental bureaucrats what health care treatments and medicines they are eligible to receive and when they can receive them. All countries with socialized medicine ration health care by forcing their citizens to wait in lines to receive scarce and expensive treatments. Although Canada has a population smaller than California, 830,000 Canadians are waiting to be admitted to a hospital or to get treatment. In England, the waiting list is 1.8 million citizens. At Whole Foods we allow our team members to vote on what benefits they most want the company to fund on their behalf. Our Canadian and British team members express their benefit preferences very clearly-they want supplemental health care more than additional paid time off, larger donations to their retirement plans, or greater food discounts; they want health care dollars that they can control and spend themselves without permission from their governments. Why would they want such additional health care benefit dollars to spend if they already have an “intrinsic right to health care”? The answer is clear-no such right truly exists in either Canada or the U.K.-or in any other country.
Rather than increase governmental spending and control, what we need to do is address the root causes of disease and poor health. This begins with the realization that every American adult is responsible for their own health. Unfortunately many of our health care problems are self-inflicted with over 2/3 of Americans now overweight and 1/3 obese. Most of the diseases which are both killing us and making health care so expensive-heart disease, cancer, stroke, diabetes, and obesity, which account for about 70% of all health care spending, are mostly preventable through proper diet, exercise, not smoking, minimal or no alcohol consumption, and other healthy lifestyle choices.
Over the past two decades, breakthrough scientific research by Colin Campbell, as documented in his book The China Study, and clinical medical experiences by many doctors including Dean Ornish, Caldwell Esselstyn, John McDougall, Joel Fuhrman, and Neal Barnard have shown that a diet consisting of whole foods which are plant-based, nutrient dense, and low-fat will help prevent and often reverse most of the degenerative diseases that are killing us, and becoming more and more expensive to treat through drugs and surgery. We should be able to live healthy and largely disease free lives until we are well into our 90’s and even past 100 years of age.
Health care reform in America is very important. Whatever reforms are enacted it is essential that they be financially responsible and that we have the freedom to choose our own doctors and the health care services that best suit our own unique set of lifestyle choices. We are responsible for our own lives and our own health. We should take that responsibility very seriously and use our freedom to make wise lifestyle choices that will protect our health. Doing so will enrich our personal lives and will help create a vibrant and sustainable American society.
Categories: health care reform
Shopping at whole foods has always been the lesser of two evils-shop at a regular store and be unhealthy and unhappy or shop in whole foods and risk buying foods that haven’t been kept fresh enough (it was ironic when it was fresh fields of course)but in all seriousness I stopped shopping here for many years simply because they didn’t seem to understand that fresh food without preservatives needs to be kept ICE COLD. Also the employees never seem all “that” happy (for the most part)and now I know why (whole foods was taken over by an upper class capitalist (sic) which is one who truly believes in their heart that greed is good and all thoughts follow from that. I guess as the bible says “all things work for good” but still you’ll be happier if you have a smaller natural food store near you as they will offer you more help and won’t be all about gettin’ your money.One political comment-it’s irrelevant to be a democrat or a republican as the usa has been a socialist country for almost 100 years at this point. Also the most radical thing you can do for your own freedom and health is to be a conscious consumer and when it comes to food if you have the youth and energy PLEASE grow some of your own food and RECRUIT others to do the same-there may be nothing else that saves our freedom (I can assure you no other “ISSUE” will).
John:
Well done article, excellent points. I agree with you, insurance reform is important and desperately needed. You outline many changes that could make a difference. I’m not sure you addressed “sick care” reform even though you titled your article “Health Care Reform.” You did note that prevention was critical. Please let us know how you would mandate prevention? How would you measure compliance?
If you could, please address some of the following issues. How would you handle “errors and omissions?” I understand that these two elements contribute to about 150,000 “sick care” deaths per year. I believe we protect our “sick care” practitioners from retribution when they kill someone. When they make a mistake we review the outcome and retrain them. How do we fix this? As you might recall, last week two pilots lost there licenses for flying in the wrong direction. They didn’t kill anyone.
Further, there appears to be a rapid infusion of capital investment in “sick care” plant and facility, especially new technology, at very rapid speed, adding to the cost of care for all of us. How would you moderate this infusion?
I you would, please address the “sick care” practitioner burnout rate, the shortage of “sick care” professionals, and the limited access to “sick care” most citizens are dealing with throughout the country? Regarding access it might be useful to address the use of CPT and ICD9/10 codes and the “kickback” the AMA receives for use of these codes, or the lack of codes in support of psychiatric care.
Last but not least, please address the need for continuous quality improvement and the perceived lack of value or price transparency exhibited by our “sick care” industry that includes pharmaceuticals and equipment providers. Does your company have an ISO9000 rating, and if it has instituted continuous quality improvement, why hasn’t the “sick care” industry?
John,
Well, it looks like the majority of people are not too happy with your views. But I think that is more of a problem of people just not understanding economics so they see your ideas as being uncaring, greedy, or selfish, and will lead to more suffering when the reality is ideas like this could save this country from economics train wreck that is the inevitable result of our government’s policy of ever-expanding interference and prohibition of free exchange between people and businesses.
To me, it seems like every time the government tries to interfere and do something that the uninformed masses think is in their best interest, it has devastating unintended consequences. I believe that policies designed to encourage people to buy homes along with low interest rates, created the price of housing to rise to a point far beyond what they would have been worth otherwise which created a nasty financial crisis. And of course, I believe there is a correlation between government interference in health care, mostly in how the tax code treats employer-provided health insurance, and how while the cost of goods typically go down (adjusted for money supply expansion), health care costs have risen…
Well, that is not entirely true. Cost of heath care where the government doesn’t interfere as much have actually gone down. Prices of Lasik eye or plastic surgery have fallen. I think this is because people purchasing those services are price conscious, as they are not covered under government-favored insurance policies.
Unfortunately, I think you are one of the very few people in this nation that really understand economics. And so our nation’s economic policies will continue to become more intrusive and productivity will drop…and deficits rise.
In your interview with reason TV, you state that we can’t do a controlled experiment, where we would be able to clearly demonstrate that our ideas are much better the people in a society and allow it to be more productive. But, Mr. Mackey, I don’t think that is entirely true. I watched a speech given at a TED conference that touches on this topic.
http://www.ted.com/talks/lang/eng/paul_romer.html
The video is 18 minutes long, but I think it would be worth the time to view it. The central idea is that the “rules” an area has can greatly inhibit productivity as well as the standard of living. He discusses the idea of setting up a city where people can go, that has different rules. I think this is a splendid idea, as if we could set up area with rules that allow free market activity as well as personal freedom we would be able to demonstrate how vastly superior Austrian economics is to economies controlled by government.
What I would like to see is some like-minded libertarians get together and purchase an area of land (and autonomy for that land) from a poor nation, invite others that are like minded to the small nation, and then with our superior “rules” create a world class city in the middle of an area of the world that is very 3rd world…much like Singapore.
This would give us an opportunity to show the effectiveness of our economic school of though to the world in a way that couldn’t be easily refuted, and then many other nations would, seeing the success of our rules, would seek to copy them, which would be a huge benefit to the entire world.
Lord Westfall
Your August article in the WSJ is one of the most coherent arguments for the alternatives to Obamacare that I have read.
I am one of those people who don’t think too much of the organic food value proposition and have avoided shopping at Whole Foods for the last 30 something years (since I was a student at UT in the 70s and Whole Foods/Saferway and I were both young).
In solidarity with your common sense approach to healthcare, I am now an enthusiastic WF customer.
Mark in Boca Raton
Check out this video from Frontline showing what regulation of the derivitives market did to the economy, it’s interesting that Greenspan’s role model was a Libertarian. Greenspan has now come out and said he was wrong on his view of the markets. I think this is why people have so much angst on this board, John Mackay should watch this video:
http://www.pbs.org/wgbh/pages/frontline/warning/view/?utm_campaign=homepage&utm_medium=top5&utm_source=top5
I agree with you, John Mackay. Thank you for being courageous enough to stand tall and say the right thing. You really understand economics and how the currently proposed sweeping health care package will not give any of us tax-payers affordable health care. The current disaster on the table will cause even more economic hardship on the tax-payers than we have now.
Comment on “Health Care Reform – Full Article Aug 14, 2009:
This is THE BEST article I have ever read on this topic. Hands Down!
I’m 55 yrs old, male, work out with weights & running, eat healthy and do herbal detox 2ce a week to keep my innards cleaned out. I look 40. I never brag about my health, but the benefits are worth it, including a post-age-50 maturing process.
A favorite Bible verse:
Therefore, I discipline my body, and bring it
into subjection, unless, when I have spoken to
others, I become disqualified. 1 Corinthians 9:27
Regards, Clare W Costa Mesa, CA
Well said–I will shop at Whole Foods more often to support you and your company’s policies!
I enjoyed your Reason.TV interview particularly your lucid explanation of why you believe in capitalism. I sent the link to my friends. I am a shareholder and a customer and support your efforts to expand knowledge of capitalism and its benefits. I am very happy to see that the supposed boycott by the limousine liberals didn’t bear fruit. Guess they couldn’t find the good stuff for their cocktail parties any place else. Keep up the good work.
- A Fellow Radical for Capitalism
I agree that individuals are largely responsible for their own health. They are responsible for what they feed their bodies.
All you have to do is look at an American grocery store and you can see what people eat. Most grocery stores have at least one side of an aisle with soda pop. Then there is a whole isle with potatoe chips and corn chips. One side of an aisle with candy. One side of an isle with ice cream. Another isle with cookies. I’m talking about the full length of an isle here. The majority of the bread display is white balloon bread that has almost no nutrition in it. I recently heard it described as just an envelope for meat.
When we need medical care, we need it. But we can take good care of ourselves by eating healthy food that contains good nutrition and not need it so much.
Great article. Thank you, and I am very proud to be part of the Whole Foods team!
I agree with your article! Thanks for speaking truth.
Reform is needed. Health care for the poor is needed but “insurance” won’t solve the problem.
I am not an expect in health care but all we have to do is look at Medicare and see the government isn’t either.
In some ways you are right, but I still feel that the notion of socialized health is essential to this country. We are too wealthy a nation in both money and resources to turn a blind eye to the needs of our fellow citizens.
To truly reform health care, it is going to require everyone to give a little. But the medical industry itself also needs to bear part of the burden and preventative methods need to be implemented.
There has been an average increase of 125% in insurance premiums since 1999, this is too extreme to simply lie on the shoulders of the insurance companies alone.
According to Dr. Eva Mor “The administration of the existing health delivery system is bloated with waste and unnecessary cost. If information was shared by all providers of health services and all insurers by using computerized systems to store all medical records, it would cut costs and reduce errors that would save and improve lives.”
http://www.ourblook.com/component/option,com_sectionex/Itemid,200076/id,8/view,category/#catid107
Many doctors and medical professionals are facing the health care debate and reassessing the industry on a whole. There are many aspects such as IT that could assist in the decrease of overspending. However, several of them also believe in an need for regulation in procedural costs, in conjunction with a preventative care system.