Today’s Managing Health Care Costs Number is 217
Dylan Scott of Vox calls this Vampire TrumpCare – because attempts to revive the reviled American Health Care Act continue to proliferate – and the bad ideas embodied in this bill just can’t seem to be killed.
1) The Freedom Caucus of hard-line right-wing Republicans and the Tuesday Group of self-styled moderate Republicans have been debating options to allow states to opt out of the insurance reforms of the ACA as long as they have high risk plans where disadvantaged sick people can seek refuge. But these high risk plans are always under-funded – so many will be unable to afford the premiums. Bad idea.
2) Ted Cruz inveighs against the unaffordable mandates and essential benefits. But the most controversial – free contraception – actually lowers the cost of health care. And do we really want health plans that don’t cover maternity care, or mental health. Yup – I’m a guy in my 50s and I won’t personally be using a maternity benefit again. But I don’t want young moms and families bankrupted by the cost of delivering a baby! We already have the least friendly environment for young families (no mandatory maternity and paternity leave, for instance). Do we want to make this worse? Julie Rovner has a nice summary today in Kaiser Health News showing that the cost of these mandatory benefits is not what’s breaking the bank. Rovner also points out that doing away with standardization of insurance will make it impossible to have risk sharing for high cost members across plans.
3) States should have choice. Sounds good in theory – and I don’t want to have Oklahoma deciding health care policy in Massachusetts. The New York Times has a review of how two states with Republican governors, New Mexico and Oklahoma, had vastly different approaches to Medicaid expansion and exchanges. In New Mexico the uninsured rate plummeted, there is brisk competition of insurers on the exchanges, and premium increases have been modest. In Oklahoma – Obamacare is a disaster. The Supreme Court designed a great natural experiment about what happens when states have the ability to decide not to implement federal health care policy. Just look at the disparity among states in Medicaid expansion to see how well that worked!
4) All Republican repeal plans erase the individual mandate. Fine – no one wants to be told what to do. But getting the healthy to purchase insurance is critical to having sustainable insurance markets. Insurers won’t sell insurance at reasonable prices if people only purchase that insurance when they are already sick, much as you can’t purchase home insurance when your house is burning down. Many dislike the individual mandate philosophically – but have offered no great alternative. Regina Herzlinger, a conservative, pro-market Harvard Business School professor, has a review in JAMA of how Switzerland, Germany and Singapore achieve universal coverage without turning to a single payer . The answer in two words: Individual Mandate. The answer in a paragraph:
Switzerland, Singapore, and Germany have achieved universal coverage and made insurance affordable even for their citizens with highest health care costs by instituting an individual mandate. One major difference, however, is that unlik e the ACA, the mandates instituted by these countries are reinforced with effective penalties for nonparticipation, thus ensuring that lower-cost enrollees—generally healthier individuals—balance out the costs of the others who require more medical resources.
Trump has set another deadline for voting on TrumpCare: Wednesday 4/27. The bill continues to be a collection of bad ideas that have already been disproven in the market. Sarah Kliff points out that the barriers to passing this poorly designed legislation are Yuge. They need 217 votes – let’s hope they continue to fall short.
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