You cannot centralize, subsidize, and bureaucratize success.
Like the federalization of our schools, the progressive federalization of healthcare delivery in the United States over recent decades is a text book example on how to produce the worst possible results at the highest possible costs.
Of course, using the logic of the Washington political class, the answer to the problems that their programs create in the first place is to double down. Spend even more money, grab even more control, and demand compliance with this or that regulation—or roast on the spit in bureaucratic hell.
It proves yet again Ronald Reagan’s oft-stated maxim that the government isn’t the solution, government is the problem. Just the way the world works.
It was no surprise then that Barack Obama rode on the back of public discontent with surging healthcare costs over the last several decades all the way to Obamacare. He and his party’s bald-face lies about “reducing costs” and the “fairness” issue was simply the ultimate placebo.
It’s also no mystery why Obamacare is a massive disaster of unprecedented proportions, both for healthcare and the economy.
You cannot centralize, subsidize and bureaucratize success.
Since 2010 every election in part has been a referendum on the Obamacare nightmare, and Republicans time and again told the voters that they understood; they’d repeal and defund Obamacare, and return to market choice and sanity in healthcare.
Now the chance has arrived. Elections were won. The public is ready. A willing President is ready.
And yet, now we learn that we have “problems.”
Obamacare can’t be repealed as easily as it was passed. It’s complicated. Oh, and by the way, the “replacement” plan is really not a plan at all, after seven long years in which to prepare.
It doesn’t appear that Washington really wants to let go, does it?
It is hard not to be cynical. It seems the problem is that the ruling political class, big insurance companies, and the administrative state, having tied the noose every tighter around the nation’s healthcare system, don’t want to surrender control. They like power. They like having every citizen’s life choices in their incompetent hands.
We’re told that by “necessity” there will be a three-step repeal process. And despite vigorous denials by Congressional leadership, it appears that the proposed replacement for Obamacare will be many things—but a free market, patient-centered alternative isn’t one of them.
In its essence, the Republican proposal actually “amends,” not replaces, Obamacare, and leaves intact much of its worst bureaucratic over-reach and wreckage. (We’re “assured” that steps two and three of reform will fix everything. Where have we heard that before?)In addition, the Congressional proposal obviously believes in the power of “subsidies” as though they are the same thing as real market forces brought about by competition and consumer choice. Yet subsidies only offset income in the tax system, and there is a huge body of economic evidence that government subsidies almost never benefit those being given the subsidy.
The current proposal is really, like its predecessor, an entitlement program that transfers wealth—yours—to someone else, and limits choice by regulation and taxes.
The critical question is this: when did we make the decision in this country to abdicate all personally responsibility for the health of our families and ourselves to an indifferent, dysfunctional federal government?
Healthcare is a commodity, a service, and is subject to the same economic and psychological forces as any other purchase. Leaving the repeal process aside, it seems obvious that there are easy “freedom” fixes for the mess we’re in, and they could be written up in two or three pages.
Tort reform and selling insurance across state lines are now obvious to almost everyone; but beyond that, simply returning to the status quo prior to Obamacare, would be a massive improvement.
If you and your employer want to keep the third party insurance model, why shouldn’t you? Prior to Mr. Obama, over 85% of insured Americans were satisfied with their own private health plans provided through health insurers, and most people bought health insurance if they could. The system worked in spite of its shortcomings.
But the real free market answers are in Health Saving Accounts (the Republican plan does propose to double the non-taxable account contributions to $13,000 per year per family, but retains the restrictive bureaucratic and IRS regulations that control Health Savings Accounts) and private doctor co-ops. In both of these models, patients and doctors are directly connected. When patients directly pay for their own services, the entire dynamic of the doctor-patient relationship becomes personal and economically competitive.
These personal medical savings accounts (with catastrophic insurance coverage attached for major events or illness) and doctor co-ops have the greatest potential to drive costs down dramatically and provide accountability through the unlimited choice of medical providers and price competition.
If Congress is serious about free market reform, they need to focus on these approaches and remove the regulation of Health Savings Accounts to allow them to be completely portable employer to employer with carryover balances going with the account holder. Also, both individuals and employers, or a combination of both, should be allowed to contribute pre-tax dollars into an account at least equal to the deductible for a catastrophic health care plan for each family member per year, and to allow the deductible of catastrophic policies to be paid using the account funds.
One other benefit of this honest free market approach is that instead of driving lower income Americans and the poor into Medicaid with its huge waste and abuse, non-profits and state governments can fund individual Health Savings Accounts or doctor co-ops directly for those unable to do so in whole or in part, with all of the benefits and service every other citizen would enjoy.
Pre-existing conditions, like coverage for lower income Americans, remain a huge political issue. Over time, Health Savings Accounts and their catastrophic riders would render pre-existing conditions a moot point if portable accounts could be kept in place. In the meantime, if Washington really wanted to do something useful, they could facilitate state, regional, or national “high risk” pools (a concept used effectively for many years for all types of insurance) for those that need pre-existing coverage for any reason.
This is all doable. The free market is never the wrong choice, and it is never hard, if Washington simply gets out of the way.
Dear Friends, I’m honored to be speaking at the annual Rappahannock County Republican Committee REAGAN DINNER on Saturday, April 22 in historic Washington, VA at the Fire Hall, 6:30 PM. For more information contact Evelyn Kerr at 540-937-8293 (firstname.lastname@example.org)