Free market trumps concerns over expansion - SC Small Business Chamber of Commerce

March 23, 2013

By Frank Knapp Jr. | Rock Hill Herald

Why do so many of our state’s officials not believe in our free market economy?

That is the question I keep asking myself every time a state official dismisses the benefits of expanding Medicaid to low-income South Carolinians by saying that there aren’t enough doctors. According to the opponents of Medicaid expansion,if there aren’t enough doctors to handle the increase in demand from the hundreds of thousands of newly insured, then these citizens still won’t have access to health care. Therefore we shouldn’t do it.

This is just one aspect of the debate our Legislature is presently having about expanding Medicaid to citizens with incomes up to 138 percent of the federal poverty level as allowed under Obamacare (Affordable CareAct).

While there might be some legitimate concerns about expanding Medicaid (concerns I believe can all be resolved), the “not enough doctors” objection reflects poorly on South Carolina public officials who typically cite the free market economy as the answer to our state’s problems. One tenet of a free market economy is that when there are customers willing to pay for goods and services, entrepreneurs and businesses will respond by producing the goods and services to fill the consumer demand and make a profit in doing so.

Our health care business community certainly responds to consumer demand as any other industry does. We already have the demand for health care services from the uninsured. But since that demand is not backed up by the ability to pay, our private sector health care community does not ramp up to meet that demand.

Expanding Medicaid changes this dynamic because it puts money on the table that our health care business community won’t pass up. In May of 2010 I participated in a panel to discuss the implications of Obamacare, which had passed Congress two months earlier. One of the other panelists was the CEO of a large primary care physician group in the Lowcountry of our state. He was very critical of the new law but he saw the business opportunity it presented.

This health care executive said that his business would be expanding into more rural areas of the state and locate in strip shopping malls to serve the increased demand from having more people with Medicaid as well as private insurance due to Obamacare. The new locations, he said, would help solve the transportation problems some people have in getting to a doctor.

Just like the health clinics that we see popping up in many of our convenience store chains, the private sector will not let an opportunity to reach new, paying customers pass them by. While these new, even if limited-services, primary care sites use only nurse practitioners for providing health care, the newly insured through Medicaid will find the access they mostly need.

Do we need more doctors? Absolutely. And provisions in Obamacare are addressing these training needs. But the private health care community will work through present shortages. The entrepreneurial spirit will rise to the occasion.

Whenever significant progressive changes from the status quo are proposed, those who object for other reasons have always preached that something can’t work. And almost every time the naysayers turn out to be wrong.

This is again one of those times. Expanding Medicaid is the right thing to do for our low-income citizens and our business community. The new demands on our healthcare system will be met because that’s what our free market does when there is profit to be made.

Frank Knapp is the president and CEO of the South Carolina Small Business Chamber of Commerce.