The GOP Insurance Plan: Look for Better, not Best
Don't Expect to Get Everything You Want - At Least Not Right Away
March 13, 2017
Don’t expect to get everything you’d like in whatever version of ObamaCare replacement the Republicans end up passing. It doesn’t work like that. And don’t worry about the Libertarians, Conservative purists, and the Freedom Caucus setting their hair on fire over certain provisions of the plan. They don’t expect to get everything they want, either.
Like the Democrats, the Conservatives mentioned above will make lots of noise about what they hate and what has been left out of the plan. Everyone will have their say, and then the Art of the Deal will kick in. Negotiations will take place, and then we will get a health insurance plan that is better than ObamaCare – but which is not the best that a great nation like ours should be able to produce.
That is because the Founding Fathers bequeathed us a system of government that is great – but not perfect. It is called politics. Not “politics as usual,” which everyone bemoans. It is politics by design, something that has been sorely lacking in our country for the past eight years. Obama basically shut off political debate while he was in office. He ignored Congress and used Executive Orders to write laws from the White House.
Am I saying that arguments are good? Yes, the Framers of our Constitution and system of government expected us to fight and argue over important matters, to wheel and deal, to threaten and persuade. How do you think we got the Declaration of Independence, the Constitution and the Bill of Rights? They fought and argued over large concepts and even over individual words. They wheeled and dealt, and they threatened and persuaded.
I am currently teaching a class at my church on the Christian Foundations of our Nation and the Constitution. In reviewing the history, I was struck once again by just how much fighting and arguing went into the construction of our founding documents. For instance, many times delegates threatened to walk out of the Constitutional Convention - and some did. Of the thirty-six delegates who were still in Philadelphia when it came time to sign the new Constitution, three refused to do so.
Another interesting conflict involved the Bill of Rights. Some states refused to ratify the Constitution because of its lack of protection for individual liberties. Only the promise of James Madison and others at the convention that this matter would be addressed in the future convinced these states to ratify. In fact, two states, North Carolina and Rhode Island didn’t ratify the Constitution until after George Washington was sworn in as president. The ten vital Amendments that make up the Bill of Rights were ratified three years after the Ratification of the Constitution.
So don’t expect our modern-day politicians to be wiser, more effective or more efficient than the Founding Fathers. Here’s what you can expect…
Transparency - The Legislators Will Actually Know What They Are Signing
Unlike the 2,700 page ObamaCare bill, which few of the people who voted on it ever read, the GOP proposal (which is, admittedly, the first of three phases) is only about 100 pages long. In fact, in an attempt to slow down the process, the Democrats insisted that the clerk read the entire bill during debate – something that is almost never done. By contrast, when ObamaCare was being argued before the Supreme Court and a lawyer suggested that the Justices read the Act word for word, Justice Antonin Scalia erupted, “What about the Eight Amendment?” (The Eight Amendment prohibits “cruel and unusual punishment”.) Justice Stephen Breyer admitted that he had not read it, and asked the lawyer, "So what do you propose that we do other than spend a year reading all this?"
By contrast, none of the ObamaCare Act was read, and Nancy Pelosi (the Democrat Speaker of the House at the time) didn’t want legislators or the public to know what the nation was about to commit to. She famously said, “We have to pass the bill so that you can find out what is in it, away from the fog of the controversy.” If there was so much controversy that they had to rush it through, it certainly deserved more analysis. But the Democrats controlled both houses of Congress and the White House, and were able to ram it through with very little scrutiny.
Simplicity – The Public Will Understand it Without Waiting for the Bureaucrats
The GOP plans to actually write the law in Congress, and not allow the Fourth Branch of Government (the bureaucracy) to do so. The ObamaCare bill included dozens of places where it directed that “The Secretary shall…” promulgate rules to define and complete the Act. These ended up totaling well over 20,000 pages of regulations besides the 2,700 page Act itself. (“The Secretary” refers to the Secretary of Health and Human Services, an unelected bureaucrat.)
Economics – The ObamaCare Replacement Will Reduce, Not Increase Costs
Obama promised that health insurance costs would drop dramatically under his bill. In fact, the average American now pays 25% to 50% more for their coverage. In Arizona, costs went up 116%. And deductibles – the amount the patient pays before insurance starts paying – are up hundreds of percent across the board.
Access – More People Will Have “Real” Insurance than Under ObamaCare
Obama and the Democrats claim that millions more citizens have insurance under ObamaCare. What they don’t tell us is that most of those people enrolled in the “free”, substandard, insurance program called Medicare. (Of course, it’s not actually free – taxpayers pay for it.) Tens of millions don’t have insurance. 57% of them say that, even with government subsidies, they can’t afford it, or are unable to obtain coverage.
Sustainable – ObamaCare is Falling Apart; Market-Based Insurance Won’t
More than 34% of doctors who accept private insurance refuse to accept ObamaCare. Over half of the people eligible for ObamaCare have refused to enroll in it. Sixteen of the twenty-three ObamaCare Co-ops have already failed; the rest are on their way to the trash heap. The nation’s two largest health insurers have pulled out of all but a few states. In over one-third of US counties, clients have only one choice for a provider. Without competition, prices always rise. Allowing more competition and letting people buy health insurance across state lines will insure a sustainable insurance climate.
Coercion-Free – Buy What You Want or Need
No longer will you be threatened with IRS fines if you choose not to buy health insurance. No longer will post-menopausal women be forced to pay for pregnancy coverage. And – most important – no longer will young, healthy people be forced to pay for the health insurance of elderly, sick people. Probably the main reason ObamaCare has failed is that young people have chosen to pay the fines for not having insurance, rather than paying exorbitant premiums to subsidize the cost of insurance for the elderly. If you live in a small house you don’t pay as much to insure it as someone who lives in a mansion. If you drive an older basic car, you pay less for insurance than someone with a new Corvette. That makes sense. Paying for insurance you don’t need doesn’t make sense.
Insurance That Works – Many Have Insurance, but Can’t Get Care
We used to have health insurance where we had reasonable yearly deductibles of $500 to a few thousand each calendar year and if we had a catastrophic event we could actually afford to go to the doctor or the hospital. Today, under ObamaCare, millions of Americans pay far higher premiums but they still have deductibles higher than $10,000. They have insurance, but they can’t get health care because they have to pay that $10,000 before the insurance policy pays a penny. The GOP replacement plan will lower both premiums and deductibles.
That’s the good news. The bad news is that President Trump has decided to retain some aspects of ObamaCare because they are “popular.” Since when did popularity become a more important criterion for a law than its constitutionality?
The GOP replacement plan will probably retain the requirement that insurance companies allow adults up to age twenty-six to be covered under their parent’s plan. Traditionally we have had two ages at which young people are considered adults. One is eighteen, the age at which people can vote. The other is twenty-one, the age at which (in most jurisdictions) they can buy alcohol. I know of no state in which a legal definition of adulthood exceeds twenty-one. For instance, this is the age at which young adults can sign contracts (again, in most jurisdictions).
In effect, Obama changed the age at which people become adults to twenty-six. He gave no reason for this; it was done simply to get more “Millennials” to vote Democrat. At a time when we desperately need young people to grow up more quickly, Obama decided unilaterally to tie them more firmly to momma’s apron strings.
The other “popular” ObamaCare provision that will probably be kept is forcing insurance companies to accept patients with pre-existing conditions. This may sound like a kind and compassionate thing to do, but it could be the final straw that crushes the insurance industry. If the insurance companies pass the huge costs on to the consumer – as they must – millions will be unable to afford to buy insurance.
I have medical conditions that make it more expensive to insure me. Should other people who are in perfect health be forced to pay higher premiums to subsidize my health insurance? Is that fair?
But it’s worse than that. I already have health insurance. But if I didn’t, under ObamaCare I would be allowed to buy insurance at the same rate as someone without my conditions without being “rated” (paying a higher premium in proportion to the higher risk the insurance company takes by insuring me).
I decide not to buy auto insurance. I cause an accident in which someone dies, and the potential liability is in the millions. No problem. I’ll just go to my insurance agent and pay a small fee for insurance to cover the accident that has already occurred.
Or let’s say I live in a flood plain but decide not to buy flood insurance. If the river rises and destroys my house, it’s not a big deal. I’ll just tell my agent that I’ve decided that flood insurance is a good idea, after all.
Does that sound ridiculous? It’s no more ridiculous than a healthy, uninsured person who is diagnosed with terminal cancer. If he or she is allowed to buy health insurance after the diagnosis, the insurer will pay millions before that individual dies. But he or she will only pay a few thousand dollars. Everyone else in that insurance pool will pay the millions.
“But isn’t that the whole idea of insurance – spreading the risk?” Yes, but for any kind of insurance – life, health, fire, business – to work, the insureds must start with at least roughly equal risk. If not, they must be rated. That’s why you can pay pennies for life insurance when you’re twenty. If you wait to buy a policy until you’re seventy, expect to pay through the nose. That’s also why your car insurance policy skyrockets when your first teenager gets a driver’s license. Why? Teens are far more likely to have accidents than adults.
The only way pre-existing coverage for health conditions works is with very large pools (such as employee health coverage in a big corporation). The insurer can afford to take a few high-risk individuals based on the size of the pool of insured people. But even that is not unconditional. The insurer will have the business submit a survey of the people to be covered. Depending on many factors – such as the number of younger versus older employees – the insurer will calculate their assumed risk and charge accordingly. If the population is mostly elderly, you can be sure the rate will be higher.
The insurer may also include a clause regarding pre-existing conditions. These clauses may preclude coverage for a certain period of time (usually a year) for pre-existing conditions – even if the condition was unknown at the time coverage was initiated.
Obama and company claim that failing to give chronically ill people coverage at the same rates as healthy people is “discriminatory.” But in fact, requiring such coverage discriminates against healthy people, since the cost of caring for chronically ill people is roughly ten times that of the health care costs for healthy folks.
Discussions of pre-existing conditions almost always fail to address the elephant in the room – the fact that 75% or more of chronic health conditions are caused by the poor choices of the patient. For instance, Type II diabetes can almost always be reversed by changing one’s diet and exercising. But most diabetics don’t exercise or eat less sugar. They just take extra insulin when they decide to eat the cake and ice cream at the birthday party. The same is true of most cardiovascular disease and many types of cancer.
Of course, there are some types of medical needs, such as traumatic accidents, hereditary diseases, and others that no one can control. But if Americans would control the factors they can control, the cost of health care would plummet. Among the seventeen wealthy nations that spend the most on health care, America ranks number seventeen in overall health.
Question: If a person decides to smoke cigarettes, drink alcohol, eat huge amounts of horrible food, and sit in front of the TV all day – should everyone else be forced to pay for their bad choices?
When I was younger I made many bad health choices, including living a sedentary lifestyle and eating lots of sugar and refined foods. As a result, I almost died five years ago. After that experience, I decided to start taking responsibility for my health. But I have paid for those choices in the form of higher health insurance and life insurance premiums. I don’t expect you to pay for my mistakes.
In summary, I won’t be totally happy with whatever health insurance plan finally gets signed into law. But neither will you or anyone else in the country. To expect otherwise would be childish and immature. To those Republicans who say they will vote against the replacement for ObamaCare unless it contains their pet provisions, I say, “Grow up.”
To me, it’s rather like the Christians who didn’t vote last November because they said Donald Trump was rude, crude and lewd. I told them, “Would you rather have rude, crude and lewd, or pure evil?”
Today, I say to the Republicans, “Get together. Work out the best deal you can. And then get behind it 100%.”
On the one hand, we have ObamaCare - government-controlled health care, in which the government rations care and decides who lives or dies. On the other, we get back control of our health care, we get government out of our doctor’s office, and we pay less for better care. I call that a good deal - even if the new law doesn’t give me everything I want.
The Inevitable Obamacare Death Spiral
ObamaCare – The Myth of Pre-Existing Conditions
Obamacare's 2,700 Pages are Too Much for Justices
“The Secretary Shall Determine” that “Someone Lives and Someone Dies”
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