There’s been a lot of political noise, much of it amplified by the media, heading into the November elections about healthcare and the two party’s stances on the issue. As usual, the framing of the debate is utterly ridiculous and both Democrats and Republicans are missing the point.
This is worth unpacking, not only to set the record straight, but to lay out how the current debate is emblematic of all our problems in healthcare policy, including the increasing unaffordability of health insurance and healthcare.
Republicans have been getting assailed for voting to eliminate preexisting conditions “protections” during last year’s various unsuccessful attempts to repeal Obamacare. This is both right and wrong.
It’s right in the sense that a repeal of Obamacare would eliminate the federal mandate forcing insurers to ignore the actuarial risk of individuals with costly preexisting conditions. It’s wrong in the sense that none of the bills in 2017 would have actually done that.
The truth is that while almost every congressional Republican has claimed that they support repealing Obamacare, they proved last year that most of them don’t really want to do that. Keeping the insurance regulations intact—as each iteration of their “repeal” efforts would have done—means keeping Obamacare intact.
It’s true that most Americans support keeping the preexisting conditions mandates in place. It’s also true, as a Cato survey discovered, that most Americans oppose these mandates when they realize they’re the reason they can no longer afford their health insurance because their premium has more than doubled in five years.
The solution is to get government out of healthcare altogether—out of regulating health insurance, out of subsidizing insurance companies, out of price-fixing for drugs and pharmaceuticals, and out of bureaucrat-driven constraints on the supply and demand of healthcare.
A cursory overview of government’s involvement in healthcare paints a pretty bleak picture.
Medicare is on the verge of going bankrupt by 2026 according to the Congressional Budget Office. This in spite of progressive caterwauling about “Medicare for All” socialized medicine that would cost at minimum $32.6 trillion on top of our ever-increasing $21.5 trillion national debt.
Obamacare has all but destroyed the individual market with nearly a third of all counties in the United States down to either one or zero insurance carriers.
And Obamacare’s Medicaid expansion to the young and healthy has further diminished the already poor quality of care that program provides to the needy, while inflicting substantial strain on state budgets.
This is what happens when politicians and bureaucrats are empowered with control and decision making over something as essential as our health.
What we need is healthcare freedom. And we need it as soon as possible. And we need millennials to lead the charge to make this a reality.
An Alternate Vision
So, what would healthcare freedom look like? What does it even mean?
In short, it’s moving us to a patient-centered system where free markets and community-based solutions drive down costs to ensure high-quality affordable care.
Specifically, it begins with repealing Obamacare and the cost-driving insurance regulations and mandates that have doubled or tripled premiums on average since 2013. The two costliest mandates, guaranteed issue and community rating, are responsible for most of the cost increases that families and individuals have been experiencing.
A study by Milliman found that these provisions alone increased premiums by around 45 percent. And a study by Avalere found that these regulations caused plans on the Obamacare exchanges to result in 34 percent fewer providers, 24 percent fewer hospitals, and 42 percent fewer oncologists and cardiologists.
This is because those two mandates—commonly referred to as preexisting condition requirements—force insurance companies to offer one-size-fits-all policies that don’t take actuarial risk into account.
For anyone who understands how insurance works, those mandates effectively turn health insurance into something less like insurance and more like welfare. And not only do they raise the cost of our premiums and deductibles, but taxpayers are also on the hook for the insurance subsidies that prop up the carriers operating in the Obamacare exchanges.
This is an insanity that only government could devise.
But repeal is only the beginning. After that, we need to move back to direct primary care where patients and physicians interface directly with one another. No more third-party interventions from government bureaucrats or insurance bureaucrats dictating copays and deductibles.
Patients should be able to directly negotiate rates with providers in a competitive market that has well-trained and competent physicians competing for our business. This will not only lower the price of care, but also improve its quality as competition does in every other area of our lives.
Sharing associations, sometimes referred to as sharing ministries, should be expanded. Right now, they are largely free from Obamacare’s regulatory apparatus. This was due to a specific carve-out during the debate back in 2009 and 2010 that was necessary to secure the votes of then “Blue Dog” Democrats in conservative districts.
These associations operate like a risk pool. Members pay a monthly fee that goes into a pool. And when someone gets sick or needs care, the association helps them pay for the costs in a community-based approach.
These should be expanded in a direct primary care environment as a means of helping defray costs associated with long-term care needs and preexisting conditions. Think about it. What if you, your neighbors, your congregation, could all operate a pool (with a trustee) that everyone paid into monthly that could be used to help those in need of emergency or long-term medical care?
Why can’t we do this civil society enhancing activity in the supposedly freest nation on earth?
Furthermore, we should expand health savings accounts as a tax-free repository for those who wish to save for potential healthcare needs down the road. And as Medicare continues to spiral toward bankruptcy, this should happen sooner rather than later so that young Americans can go ahead and start saving for a program unlikely to be around for when they’re older.
And lastly, health insurance must be restored to its proper function as a backstop against potential catastrophic medical situations. This is how auto and homeowner’s insurance works and is how health insurance should work as well. And such insurance should be decoupled from employment so that it becomes portable and individuals and families own a policy tailored to their specific health needs.
All of this would allow markets to begin to take root to start lowering costs across the board and providing better care.
And if health savings accounts and sharing associations are not enough to assist those relatively few Americans with long-term care needs and preexisting conditions, then that’s when the beauty of federalism shines. State-run high-risk pools, which would use state tax dollars in a manner similar to sharing associations, could be constructed to help provide yet another financial backstop for those truly in need.
Right now, Democrats are running hard toward socialism and completely bureaucrat-run healthcare as a solution to a mess that they exacerbated through Obamacare. And Republicans are running scared to try to convince people that they don’t want to kick people off their “coverage.”
But what good is coverage when costs are exorbitant and provider networks have narrowed resulting in fewer options and lower quality care?
The current system is venture socialism via government-sanctioned cronyism. We have health insurance companies utilizing the greed found in capitalism without any of the actual market forces capable of checking bad actors.
The only way out is either real freedom or the debt-driving tyranny of government-run and bureaucrat-managed socialized medicine.
Only one of those is sustainable.
And the good news is that it also happens to provide the best care.
