Health savings accounts, government reform - Stark Reality

How one sees reality depends on where one sits and where one stands. Representative Fortney “Pete” Stark, 76, a Democrat from California, sits as Chairman of the Ways and Means Committee. He stands as an unabashed liberal favoring a government-run universal health system at any cost and opposing anything that gets in the way.

He sees himself as a paternalist-in-chief, savior, protector, and guardian of health care of the American people. He sees market-based Health Savings Accounts (HSAs), designed by its backers to give people freedom to choose their care as a plot. That’s why he sees HSAs as something for “the healthy and wealthy,” “weapons of mass destruction,” and “country clubs for the rich.”

Stark sees doctors and hospitals as avaricious, self-referring, self-enriching allies bilking Americans of their right to “free” health care. To rein in doctors and hospitals, he has created a series of Laws, Stark I, II, and III, that create hard to meet conditions under which physicians can refer to hospitals or to facilities in which they have financial interests and which might lead to competitive advantage.

The provisions of these laws, which have evolved over the last 15 years or so, are so arcane, Byzantine, and contradictory that only skilled lawyers can parse them, which is probably the reason why health care lawyers are the fastest growing segment of the legal profession.

A little background. Stark represents southwestern Alameda County, a liberal district where he has been reelected 16 times. He is the first openly atheist member of Congress. He graduated from MIT in engineering and received an MBA from the University of California. He is the longest serving member of Congress from California. He has been voted its most liberal member for two consecutive years.

Stark is argumentative, testy, opinionated, and sometimes vulgar. He accused Nancy Johnson (R-Connecticut), who favored market-based health care, as a “whore for the insurance industry” and said her knowledge of health care was based solely on “pillow talk” with her husband, a physician.

Now Stark is at his market-obstructing tactics again. He is hobbling HSAs with another layer of bureaucracy. Here is how an April 19 WSJ editorial “Stark versus the Free Markets” sees the problem.

"This week, the House passed legislation that included a provision to require every HSA transaction be reviewed and verified as a legitimate medical expense. Democrats say this is to ensure that consumers are using their tax-free withdrawals for a knee replacement, rather than a new iPod. In reality it adds a layer of bureaucracy that could sharply reduce the appeal and cost savings of HSAs.”

”A key player here is Ways and Means Health Subcommittee Chairman Pete Stark, whose main purpose in politics is to give the U.S. a government-run health-care system. He is a known opponent of HSAs – once comparing them to ‘weapons of mass destruction’ – because they introduce more individual choice into the health-care marketplace."

Just how Stark came to see the world of physicians and hospitals as a greedy cabal is a mystery. We know in 1963, Stark founded Security National Bank, a small bank in Walnut Creek. Within 10 years it grew to a $100 million company with branches across the East Bay.

Part of that growth rested on transactions and loans with doctors and hospitals. Perhaps a few financial transactions gone sour. That may have skewed his view of the provider world. Perhaps the wealth derived from the bank converted him to an angry cadillac liberal with a guilt complex. Whatever the reason, Stark exemplifies righteous indignation at work against those who don’t share his world-view.

Who knows? But what we do know is his laws and his views stifle market innovation and costs physicians and hospitals a bundle of legal fees – and, indirectly, the American people, considerable expense and restricted choice.

Anyway, that’s the Stark reality as I see it.