The real irony:
The architecture of the Affordable Care Act is based on
conservative, not liberal, ideas about individual responsibility and the power of market forces.
This fundamental ideological paradox, drowned out by partisan shouting since before the plan’s passage in 2010, explains why Obamacare has only lukewarm support from many liberals, who wanted a real, not imagined, “government takeover of health care.” It explains why Republicans have been unable since its passage to come up with anything better. And it explains why the law is nearly identical in design to the legislation Mr. Romney passed in Massachusetts while governor.
The core drivers of the health care act are market principles formulated by conservative economists, designed to correct structural flaws in our health insurance system — principles originally embraced by Republicans as a market alternative to the Clinton plan in the early 1990s. The president’s program extends the current health care system — mostly employer-based coverage, administered by commercial health insurers, with care delivered by fee-for-service doctors and hospitals — by removing the biggest obstacles to that system’s functioning like a competitive marketplace.
Chief among these obstacles are market limitations imposed by the problematic nature of health insurance, which requires that younger, healthier people subsidize older, sicker ones. Because such participation is often expensive and always voluntary, millions have simply opted out, a risky bet emboldened by the 24/7 presence of the heavily subsidized emergency room down the street. The health care law forcibly repatriates these gamblers, along with those who cannot afford to participate in a market that ultimately cross-subsidizes their medical misfortunes anyway, when they get sick and show up in that E.R. And it outlaws discrimination against those who want to participate but cannot because of their medical histories. Put aside the considerable legislative detritus of the act, and its aim is clear: to rationalize a dysfunctional health insurance marketplace.
Dang. Well done. I usually suffer from a rare malady known as MBADD (Message Board Attention Deficit Disorder) that makes it tough for me to read longer posts, but this made sense all the way through.
Absolutely, the ACA features a total capitulation by the Democrats to market forces, but it also adds layer upon layer of massive bureaucracies, only feebly addresses the REAL problem (macro cost controls), and STILL leaves millions uncovered. The Dems did what they thought they could, but this thing is a pig.
We needed a way to control costs via diagnostic and preventive care and way to take a huge monkey (providing health care coverage) off the backs of businesses, and a universal, Medicare-For-All chassis would have accomplished that easily. Then we could mimic the current and VERY effective Medicare Supplement (not Medicare Advantage) system to allow people to increase their coverage with a wide variety of options in the free market. And the only added bureacracy would have been to hire more of what we already have to handle the increased amount of covered people. No IRS, not of that shit.
This thing is a mess. It may work, but we could have done much better.
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Without a doubt, taking healthcare out of employer's hands would have been the ultimate and most logical solution. The problem would be much the same as we have now; some people would claim it unconstitutional to make it illegal for employers to provide health insurance. Of course, most employers would love such a system as the burden would be off of their backs.
That is exactly what was done in Switzerland. While the ACA may show some similarities to the Swiss healthcare system, it is very different. In Switzerland, they made it so everyone has to purchase their own healthcare on the private market. The government subsidizes those who have lower earnings and those on welfare. Insurers cannot make any profit on the basic plan, and the basic plans are all very similar, covering most preventative care. Where insurers can make a profit is in their supplemental plans which the vast majority of people purchase.
The best thing about the Swiss system is that individuals must purchase their own insurance. There are only three rate levels based on age. The thing that is so empowering about it is that everyone actually understands how much health care costs as they must pay for it themselves. One of the biggest problems with our system is that employers pay the bulk of their employees health insurance premiums, so most people really have no clue what the costs really are. These employees are also fooled into believing they actually have a "choice" which is the furthest thing from the truth. In the Swiss system, people have all kinds of choices, here in the US, employers tell you what you can have when it comes to health insurance, because they only have a couple of plans to offer. In some cases, they only have one plan to offer.
Yea, we could have done much better. Unfortunately, there were too many people happy to support the status quo.
Back in 1994 when conservatives were proposing Obamacare 1, Robert E. Moffitt from the Heritage Foundation wrote a paper named
"Personal Freedom, Responsibility, And Mandates". In it he makes the case for the 'individual mandate', a conservative idea.
But he also makes a really interesting observations:
1) Employer-based insurance hides the true costs of health care.
2) Health insurance provided by your employer is not free at all, and the employer gives employees nothing. Workers are really paying for it, it is really deferred wages. It just comes out of what the employees wage COULD be.
He even suggests a simple financial disclosure on the part of the nation’s employers, requiring every employer to put periodically on the pay stub of every worker in America something like the following: “We have paid you X thousand dollars in health benefits. This has reduced your wages by X thousand dollars.” We would add: “Have a nice day!„
The Taxpayer Mandate
Policy analysts at The Heritage Foundation have wrestled incessantly with this problem, while developing a “consumer choice” plan for comprehensive health system reform, now embodied in a major legislative proposal.3 Only after extensive analysis of the peculiar distortions of the health insurance market did Heritage scholars reluctantly agree to an individual mandate.
On this point, some observations are in order. First, much of the debate over whether we should have a mandate is, in a sense, a debate over a “metaphysical abstraction.” 4 For all practical purposes, we already have a powerful and increasingly oppressive mandate: a mandate on taxpayers.
We all pay for the health care of those who do not pay, in two ways. First, people with private insurance pay through that insurance–even though that insurance is often the property of employers under current law. This reflects the ever-higher costs shifted to offset the billions of dollars of costs of uncompensated care in hospitals, clinics, and physicians’ offices. Second, if those who are uninsured get seriously ill and are forced to spend down their assets to cope with their huge medical bills, their care is paid for, not through employer-based or private insurance premiums, but through taxes, money taken by federal and state tax collectors to fund Medicaid or other public assistance programs that serve the poor or those impoverished because of a serious illness.
Hospitals also have legal obligations to accept and care for those who enter seeking assistance. No responsible public official is proposing repeal of these statutory provisions, and very few physicians, if any, are prepared to deny treatment to persons seeking their help merely because they cannot afford to pay. As taxpayers and subscribers to private health insurance, the American people pick up these bills.
Aside from current economic arrangements, the entire moral and cultural tenor of our society reinforces the taxpayer mandate. Those who are uninsured and cannot pay for their care will be cared for, and those who are insured and working will pay for that care.
So, we already have a mandate. But it is both inefficient and unfair.
A Snare And A Delusion
Employer-based health insurance in this country is the product of wartime economic and tax policy of the 1940s. There is no reason why health reform in the 1990s should be governed by those unique circumstances and outdated tax policies.
Uwe Reinhardt and Alan Krueger tell us that the tax treatment of employment-based health insurance now is sharply regressive. And, Mark Pauly confirms, it contributes to market distortions, high costs, and lack of portability in health insurance. Americans today get tax relief for health insurance on only one condition: that they get it from their employer. This has tied health insurance to the workplace in a way that no other insurance is treated. It means that if we lose or change a job, we lose our health coverage.
Pauly also tells us that employer-based insurance hides the true costs of health care. Thus, there is no normal collision between the forces of supply and demand on even the most basic level. Most workers do not purchase health insurance; it is purchased by somebody else, usually the company. For most workers, it is a “free good,” an extra, that automatically comes with the job. At least, we live with that comfortable illusion. But, in fact, it is not free at all, and the employer gives us nothing. Because too many people think that the employer’s contribution is the employer’s money and not theirs, the consumer’s perception is distorted (as is the provider’s), and health spending is not subject to market discipline. Likewise, because too many people still do not understand this reality, “hidden taxes” through the employer mandate are politically attractive. Such a mandate thus serves as a psychological snare and an economic delusion.
Karen Davis and Cathy Schoen suggest a payroll tax to finance reform, whereby the employer pays 8 percent and the employee pays 2 percent. If one of our tasks is to make the true costs transparent, this suggestion does not help very much.
In his otherwise enlightening paper, Reinhardt calls attention to the virtues of a “mandated purchase” of health insurance. And he warns that calling an employer’s “mandated purchase” a “tax” comes close to debasing the English language. But, in a similar context, Reinhardt uses the word contribution to describe suspiciously similar functions. Suffice it to say, the campaign for linguistic precision is hardly advanced by using the word contibution to describe the state’s forcible extraction of citizens’ money.
In another context, Reinhardt proposes perhaps the best single reform idea to date. He suggests a simple financial disclosure on the part of the nation’s employers, requiring every employer to put periodically on the pay stub of every worker in America something like the following: “We have paid you X thousand dollars in health benefits. This has reduced your wages by X thousand dollars.” We would add: “Have a nice day!„
https://docs.google.com/viewer?a=v&q=cache:4p7L_eWVvzwJ:healthcarereform.procon.org/sourcefiles/1994_personal_freedom_responsibility_and_mandates.pdf+individual+mandate+is+soundly+rooted+in+personal+responsibility&hl=en&gl=us&pid=bl&srcid=ADGEESgUZLdehqhbfP5lDTL2iJjb8vd9t1Wmtq-sX1PaMVgxwRU-arVQlmUuRcYmYwXa0dZrFTkOPvg-siTd6HjDpbVX6j_Y5IhZwfTEpk6FZYIKyQEejgrwKMZH-vP_d7WCCe_wqCRg&sig=AHIEtbSD-XeEiWlBd6BmHxW6ZoBiUfDfNg