Remarkable as it may seem, it is possible to analyze the Republicans’ plan without simply dismissing it, mocking it, or attributing bad motives to it, and Robert Laszewski at The Health Care Blog has done just that. Here’s one small snippet of the much longer post that does a bit of deconstruction of the entire plan into a single paragraph:
By capping the tax exclusion and offering defined tax credits to those under 300% of the poverty level and, importantly, limiting future increases of both to no more than the increase in the Consumer Price Index plus 1% (CPI+1%), the Republican proposal would increase these federal benefits annually but do so in a limited way that would reduce future federal budget costs and likely health care inflation. But, this would also shift more risk for the future cost of health care to the consumer.
Here’s his conclusion:
And, therein lies the Republican challenge––convincing people that their complex health insurance reform ideas provide people with more health insurance security than the problematic and complex Obamacare plan does. Take it or leave it––ours or theirs.
Again, I think Republicans would have been far better off taking a big gulp and accepting Obamacare as the baseline in health insurance public policy and then use many of their ideas to tell the American people how they could make it work a lot better.
After all, isn’t that what most people really want?
I think that what most people want is to be able to afford the healthcare they need when they really need it and, sadly, neither the PPACA nor the Republicans’ plan accomplish that for a simple reason: they’re both patches. The PPACA was a patch on the present (now past) system as is the Republicans’ plan. I think that patches only forestall the inevitable, that time is not on the side of cost control, and that over time our healthcare system will only become less affordable.
What the people want is, first, to be free of gummint’s forcing its idea of health insurance or education on them. Many, like me and other non-risk-averse, want to be free of insurance altogether. We want fairness, and a system that overtaxes young, single, childfree males to support women’s health and that of the old and infirm is not fair and is not even insurance.
Solutions should include: eliminate favored tax treatment of employee health benefits, force all healthcare providers to publish all pricing and give discounts for cash, encourage Amerikans to shop for healthcare and drugs in Mexico, Cuba, Brazil, and all the other places where it’s much cheaper.
Largely shifts costs onto the consumer, does not guarantee coverage and leaves it too costly for the bottom 20-30%. While it has a few good ideas not sure why they are eliminating the exchanges. A pro-market party eliminating the one place where people could actually shop and compare prices. Go figure.
Steve
What does “sell across state lines” mean? Will state insurance requirements be eliminated? If I understand correctly, the same policy can be sold in all states that have the same requirements, but all the states have different requirements. Are the Republicans invoking the Commerce Clause over States Rights?
@Tastybits, Insurance companies would be able to sell a licensed/regulated product in State A to customers other states.
I suspect that this would make the most sense in adjoining states. A Missouri insurance company with good arrangements with St. Louis healthcare providers would sell to customers in (Metro East) Illinois. The Missouri policy would be subject to Missouri, not Illinois regulation, and so it provides regulatory forum-shopping. If Missouri imposes few regulatory requirements on healthcare insurance compared with Illinois, then maybe insurance costs may be different.
Most employer-provided healthcare is completely exempt from state regulation since it is self-insurance.
@PD Shaw
I usually stay out of this debate because my knowledge is limited or personal in specific areas. Here it is neither, but I do know the auto insurance companies will do anything to get my business.
As I understand it, the states have minimum requirements in order to operate a vehicle on public roads. Insurance companies that do business in a specific state must meet those minimum requirements.
Some drivers will have existing conditions, and they will be such a high risk no insurance will want to insure them. The states require the insurance companies selling policies in their state to pick up people in this residual pool according to some system.
The auto insurance companies have any number of incentives they have developed to get my business, and they are not only looking for perfect drivers.
It is not as simple as selling the same policy across state lines because, the state insurance regulatory agencies also ensure that they are solvent. In Louisiana, insurance companies do not need to get prior approval for rates, but they can be challenged.
Because the states require the insurance companies to be solvent, it is more likely that they will have the money needed when a crisis arises. It is my understanding that it is firewalled from the parent company.
Well, yes, TastyBits. The people have spoken and what they have said is that they don’t want healthcare insurance (in an insurance plan premiums are proportional to risk) but a prepaid healthcare maintenance plan in which costs are allocated “fairly”, i.e. not relative to risk but divvied up among broad age brackets.
That inevitably means that the young pay for the old, the healthy pay for the sick, men pay for women, and the temperate pay for those who make risky lifestyle choices. I honestly don’t see how that can be made to work without either placing restrictions on provider revenues or removing barriers to entry for providers but that’s where we are right now.
I try to stay out of the debate because little of it makes any sense or is logical. Most of the players and debates are disingenuous whether the participants know it or not. Further, many of the assumptions are wrong.
There needs to be more bad health choices not less. Extraordinary means are going to be taken to keep a 40, 60, and 80 year old alive, but they will most likely still die younger than they otherwise would have. If the 40 year old dies at 50, we have saved 30 to 40 years of healthcare expenses. Smoking should be encouraged not discouraged.
If we want a really healthy older population, childhood mortality should be increased. We need to weed out the weak. We want those who cannot tolerate second hand smoke to die an early death. Tobacco products should be subsidized not taxed. The antibacterial craze should be outlawed. Only the strong should survive.
The system promotes living longer, and it insists everybody get the maximum amount of care to ensure this occurs. While the quality of life is increasing, the cost is supposed to be decreasing, and when this does not occur, the blame is placed upon unhealthy lifestyle choices.
In order to lower costs, these unhealthy lifestyle choices are outlawed or made cost prohibitive, and with their reduction, the overall quality of life increases causing the overall costs to increase. As you note, the next solution is to cost shift from the unhealthy to the healthy.
There are much simpler solutions to this mess, but solutions to this mess are not the goal.