Roemer’s Law, the brainchild of renowned universal healthcare researcher and activist Milton Roemer, states that in a fully insured society, a hospital bed built is a hospital bed filled. 

If you build it (and make a third party pay the entry fee), they will come.

Roemer believed that if an individual suffered even a minor injury and had access to unlimited “free” medical care, with a faceless third party covering the bill, he would likely seek a doctor’s help. And on the other end of the equation, a doctor who was guaranteed payment from a third party would likely offer the patient treatment for every small ailment.

Although supporters refer to this system as the rich paying their “fair share,” the reality is simply that one group does the majority of the taking, and one group does the majority of the paying. And politically progressive as he was, Roemer admitted that the group doing the taking would do so carelessly, and the group doing the paying would eventually run out of money. This system was unsustainable on its own.

“The Psychology Of Free”

Clearly, Roemer made a valid point. Customers will happily accept free goods and services for which they would not willingly pay, and proprietors will offer unnecessary goods and services when someone is guaranteed to pay for them. 

Not only do both common sense and personal anecdotes attest to this, but numerous studies bear out Roemer’s prediction. Behavioral economist Dan Ariely wrote a whole book about how freebies short-circuit our rational minds, and this tendency extends to health care. An estimated 14 to 25% of Medicare beneficiaries overuse health services at least once per year. 

Despite understanding this tendency, Roemer still insisted that a population should be insured and that health care should be “free.” Unfortunately, as even this staunch socialist had to admit, the world is governed by scarcity. Money, services, personnel, and time are limited. 

Although supporters of universal health care use verbal sleight of hand and pleasant-sounding euphemisms to explain how their plans will work within the laws of mathematics, their suggestions typically boil down to one “solution”: healthcare rationing. And Certificate of Need (CON) Laws, no matter how they are described, function this way.

The Beginning Of The CON

In 1965, President Johnson signed the bill creating Medicare and Medicaid. For anyone struggling to pay medical bills, this “free” care must have seemed like the end of their financial woes. 

But when so many people suddenly had health care with no pesky bills attached, the only way to prevent ballooning systemic costs was to intentionally shrink the supply of available care. Less than a decade after Medicare came to be, the federal government passed the National Health Planning and Resources Development Act of 1974. This act stipulated that any state wishing to keep their “free, government-funded” federal Medicare money must adopt CON legislation.

These laws limit the creation and expansion of medical practices in a given area. Even if a physician sees a need, and patients in the area agree a new facility would be helpful, the government and current providers can refuse to allow the new practice to open. Instead of patients and doctors deciding together what health services are necessary, the government decides what will be allowed. 

“Nothing Is So Permanent As A Temporary Government Program” – Milton Friedman

Not surprisingly, 49 states (all but Louisiana) still agreed to adopt CON laws. Between 1965 and 1974, their residents had gotten hooked on “free” health care, and they accepted the strings attached. But over the coming years, the fallout from CON was so spectacular that the federal government admitted it failed, and it rescinded its mandate in 1986

However, 35 states retain CON legislation, and the same people who believe universal health care can work without rationing continue to deny that CON laws are rationing. 

Rationing vs. Running A Business

A popular idea in progressive circles is that charging patients for health care is tantamount to rationing it. By definition, this is wildly inaccurate. Rationing involves “setting limits on purchasing.” Each consumer/patient can buy the same number of Band-Aids. If one badly wounded patient needs more, she cannot start a GoFundMe, ask family for a loan, or pick up extra shifts at work to pay for them. No matter how dire her situation or what effort she makes, she cannot receive the additional Band-Aids. A state with a CON law—a true rationing system—functions this way.

Simply expecting to be paid, however, is not the same as rationing. When a pharmacy customer demands a Band-Aid but explains he has no money to pay for it, and the cashier refuses to serve him, she is not “rationing” his medical care. The product/service is readily available, and he can access it the moment he finds the means to pay for it. No government inefficiency and red tape prevent him. 

Both situations may result in a customer/patient failing to acquire the help he needs. But the situation where a CON law exists is the only one where he is truly helpless. 

Patients needing medical care struggle to convince their legislators to overturn CON laws in their states. Those in urgent need of medical care can’t wait the years sometimes required to receive a certificate of need. Patients needing immediate medical care cannot wait for the government to allot medical care rations.

Patients who worry about rationing in universal health care are right to be concerned. The problem is built into the system. One way these patients can steer legislation in a better direction is to eliminate the health care rationing rules we already have: CON laws.