Paradigm Lost: GOP Fails to Articulate the Larger Issue of Obamacare
Imagine a scenario where the Federal government decides there’s a service so worthwhile everyone in the country should have it. In consultation with industry, the Feds develop regulations to make universal service a reality. The result is a complex piece of legislation that, in addition to universality, has two major outcomes. First, the industry is free to set rates. Second, since not everyone can afford the service, the government forces higher income rate payers to subsidize lower income ones.
Sound familiar? It might to your great-grandpa. In 1918 the government nationalized phone service under those auspices. What followed was 70 years of an AT&T monopoly. For three generations Americans saw virtually no innovation outside of improvements to the existing phone network. In fact, if you’re under 40 you might be surprised to learn that as late as 1984 you could not own a phone- you had to rent it from AT&T. The government finally won an anti-trust suit in 1982 after a decade of trying, and in 1984 AT&T was broken up into the “Baby Bells.” Sandwiched in between those years, not coincidentally, was the introduction of the first commercially-available cell phone.
For those of us old enough to remember, we look back at those days and wonder why we put up with it. Generation “C,” born after the internet, can’t fathom it. And even a casual student of history realizes the so-called “natural monopoly” on phone service actually stifled innovation and kept prices artificially high.
Yet the Federal government is at it again. As has been well-chronicled, the Affordable Care Act (ACA or “Obamacare”) requires every person to purchase health insurance. Those who cannot afford the premiums receive generous taxpayer subsidies. But lost in the superheated rhetoric about slow websites is a far more significant issue: ACA assumes the only way to deliver health care is via health insurance. ACA legislates away any future disruptive paradigm that would lower cost and improve service.
A current analogy would be passing a law requiring all retail transactions to be done in person or over the phone. A ridiculous notion, given the rise of on-line retailing. But as late as 1993, when the internet consisted of little more than 600 sites, e-tailing would not have figured into the debate about such legislation. Amazon, Google, and Facebook would not exist today if the government precluded their business model via legislation twenty years ago.
Amazingly, Republicans have yet to seize this larger narrative. They hold hearings about the botched website rollout. They warn us of impending disaster and cancellations and premium hikes. They pontificate about broken promises. But they have failed to coalesce around a message other than an uninspiring “Obamacare is lousy.” Sen Lindsay Graham (R-SC) recently lamented “the hardest thing for us is what to do next.”
Really? The GOP can start by articulating a vision about true healthcare reform. States would eliminate anti-competitive regulations like requiring a “certificate of need” before a new hospital can be built. Insurance would be sold across states lines. Prices for procedures and supplies would be readily available with the ability to compare and shop across systems. Payment by cash or credit card would receive a steep discount versus washing the bill through a cumbersome insurance apparatus. And of course, tort reform.
Even those changes, however, are merely tweaks to an existing paradigm. The fact is no one knows what a disruptive business model would look like. However, we do know that with Obamacare in place, we are stuck with the healthcare equivalent of renting our phones from AT&T. Obamacare shackles entrepreneurial creativity because it decrees healthcare will only be delivered via health insurance.
A new entitlement class is being created right before our eyes, and once a benefit is granted our government never, ever takes it away. With millions poised to become addicted to another government opiate, the need for an Obamacare alternative- one that harnesses market forces and creativity instead of regulation and standardization- has never been more urgent.
Unfortunately the Republicans are stuck in Chicken Little territory.
Sorry, I don’t see the connection, with the exception of the subsidies.
The AT&T investment was nothing more than a program to build a communications infrastructure. The specifics of the program essentially amount to a means of paying for it. Which in hindsight has proven to be a very wise investment I would have to say.
The Affordable Care Act is little more than a regulatory program to open insurance markets. Insurance markets made up of private, for-profit companies.
Besides, Republicans are going to have a hard arguing against something that was their idea in the first place.
The point is that a government sanctioned monopoly stifled the telecommunications industry for decades. The ACA is essentially the same thing. With so many mandates, there is very little choice or competition with the new system and it will be impossible for companies to try new ideas. All the while, we pay more for insurance…or in my case get priced out of it.
The ACA is a large government intrusion into our lives. Part of what it addresses were previous intrusions by government. The only thing it improves on is for people with prior conditions, but people with prior conditions should have had insurance which predated those conditions. Of course there are those who were born with them, but how much are others supposed to pay for someone born with a condition.
The point is: insurance is not what is needed, but health care is. How we distribute health care is what is in question. If government gets out of the way, some people won’t purchase insurance, but will want coverage if they go to the hospital – hence the requirement for everyone to purchase. In fact, no one has been denied hospital treatment. And, one way or another, everyone pays for it. So the requirement for people to purchase should lower the costs to government for subsidizing health care costs through Medicaid etc
The ACA is not a monopoly. It’s a set of insurance requirements targeting the costs to society of healthcare. And it’s working. Prior to the ACA, healthcare costs were rising at double digits and bankrupting public healthcare programs and making insurance prohibitive for employers. The uninsured were relying on emergency rooms for things that could be addressed in a doctors office and not paying the bill. Now the previously uninsured get preventative care to address issues before they get serious (and expensive).
Is it perfect? No, nothing is. But it’s certainly better than what was there before. But keep tooting the ‘kill-it’ horn and see how that works out for your political fortunes.
Pssssst….
Ummm, what are you going to do with the 30 million who still won’t have insurance?
The “problem” has not been solved.
When you have something more than rhetoric, lies or half-truths I’ll be happy to respond.
I suppose Zon would be happier if you called him an idiot or some such.
Zon,
My insurance went up more this year than the past 4 years combined.
Well it is only about you after-all, Bruce. I forgot the mandate that any law be a net positive for you before anything.
Zon,
Please answer Wiley’s and Bruce’s very valid points. You started the discussion by saying ” And it’s working”. I believe you are drawing your conclusions based on propaganda.
Wrong. A recent MIT study showed the number of emergency visits by Medicaid patients has not decreased at all. The reason, the study states, is that if you have emergency care for free, you have little incentive to change. To which those of us with a basic understanding of economics say… duhhh!
If you’re on Medicaid and you visit and emergency room and you’re not admitted, you should be facing a $100 co-pay. When people are forced to face the consequences of their actions they will begin to behave responsibly.
An interesting thought. Unfortunately, hospitals don’t care to hold the Medicaid recipients responsible for co-pays. They usually ignore the co-pay and take the Medicaid payment. So the insured has no copay. There are instances of Medicaid recipients using the ER more than 100 times per year. They also have a good understanding of how to get drugs prescribed, sometimes by stealing prescription pads and then getting them filled at numerous pharmacies in order to resell on the black market. Yes, this is something we need more of.
You said it yourself, “it’s a set of insurance requirements”. When all companies are required to operate under the same rules, providing the same services, and have little to no room for innovation…what else would you call this but a technical monopoly? Change insurance companies? Why? They all have to provide the exact same service!
Hopewell is correct in his statement below. Medicaid patients are turning to emergency room treatment more than ever.
Millions of people have received notices of cancellation. New policies cost significantly more. North Carolina premiums are up an average of 136%.
I have been priced out of the marketplace.
Costs are increasing, service is decreasing. Just ask my friend Pattie in Winston-Salem who’s son is regularly in the hospital for life threatening illness. The Bureaucrats are actually suggesting that in order for her care to be more affordable, she should divorce her husband! Other people they know have been encouraged to quit their jobs in order to qualify for better benefits. Insane!!
All the ACA has done is take a broken system and double down on it. The fix would have been to get government out of the way, allow tax deductibility for health insurance, allow individuals to purchase insurance from any company they want, etc, etc.
It’s a nightmare, and it’s only getting worse. There is even talk of a near future government bailout of the insurance companies!!
Every business operates under a set of rules common to their peers. Just how are the rules imposed under the ACA “stifling innovation”? If anything it’s stifling unchecked healthcare monopolies like Novant Health and Carolina’s Healthcare (the healthcare conglomerate that has 60% of the Charlotte market and has a ‘profit’ in the billions)
Check your facts (I have), emergency room visits are up because more people are on Medicaid. Per participant, emergency room visits are down.
Costs before ACA were rising at 10% per year on average. Costs rose in 2012 at a little over 4% when the new law was not fully implemented. So technically that statement is accurate, but very misleading.
Again, the ACA Is not perfect. But it’s a whole lot better than we had before. And until conservatives can come up with a replacement that saves $100 billion a year and makes healthcare available to all at the same time, y’all have no credibility. It’s a lost cause, a dead horse. Stop beating it.
Read. Learn.
Redistribution of Health
Christian,
I firmly believe that many who have signed up for Obamacare will not pay their premiums after several months. The burden of paying for something they cannot wear, drive or eat will be to much to bear.
When millions of healthy young people receive food stamps and government assistance it is hard to believe these same people can help Obamacare succeed.
ZON,
The way to solve the problem is to get government the eff out of the way.
The sheer stupidity of Obama and his failed Obamacare is that 30 million people will still be UNINSURED. Wasn’t the number PRIOR TO the ACA 40 million?
Obamacare is like me having a brown spot in my grass, Instead of cutting out the brown spot and fixing it with a new piece of sod, I bulldoze the entire yard and replace all the grass except half of the original brown spot.
@ Rick,
I would be happy to, if they made points. Wiley says 30 million won’t have insurance, that number is patently misleading. 30 million May not have coverage right away, but if that’s true it will be by choice. One thing is certain, before open enrollment even started there were 12 million that did not have coverage before the law that now do.
Bruce say’s his rates went up. So. Mine went down. What does that mean anyway? At an individual level not much at all.
Look, I honestly don’t like the law either. But only because it does not address costs enough. Besides, there would not be an individual mandate were it not for the whining about the government option. Which, incidentally, would have saved another $100 billion a year. But because it put severe limits on charges by healthcare companies it was shot down. Were there a public option, Bruce ( and a lot of others ) would be able to get the equivalent of Medicare for around $4,000 a year, total. That’s a lot less than me and my company are paying.
That’s what I mean by an argument, agree or not.
“Saved another 100 billion a year’…..”Zon, money is not the problem and no amount of it will solve the issues in todays world.
Trillions have been spent and look around at the results.
The world will do everything and anything to keep from dealing with reality.
I suppose you mean by public option, one that is subsidized by the taxpayers?
Obamacare is designed to fail. 1. it’s to drive smaller carriers out of the Health Insurance market much like Hillarycare’s ‘Managed Compeitition. 2. Failure will prompt the Leftists (not Democrats as there are Republicans that want it too) to push for an NHS type of Government Sponsored Health Service. 3. Carriers that sponsored the legislation will be deemed too big to fail like the banks. They will get taxpayer dollars and the contracts to pay the claims under a single payer plan.
Zon,
I thought that liberals lived by ….It’s all about how I feel and whats in it for me. ……And you’re right , when I am getting raped by a system that affects my standard of living then I am ALLOWED to make some noise.
Make all the noise you want, it’s a free country. Just don’t expect anyone to accept it as a rational argument.
I have yet to hear of someone who has lower premiums WITHOUT a subsidy.
This is a classic fault line between liberals and conservatives: conservatives care about how much things cost. Liberals care about getting someone else to pay for it.
An excellent point. Leftists all want to do good works, with someone else’s money.
Saw a study over the weekend. Compared to pre-Obamacare costs, even those with a subsidy are STILL paying more in many states.
Study, huh? Which one would that be?
Try reading a little more. Last year, a little more than $150,000,000 was refunded to policyholders because of overcharges created by the law (insurance companies are required to spend at least 80% of their receipts in actual healthcare). That auto-correcting feature assures less will be spent in premiums otherwise.
Zon when you insert the word “honestly” into your post, you admit that most of your posts are lies/dishonest. Instead of posting stupid stuff on this site, get off your ass and hit the streets for Kay Hagan’s reelection. I don’t see the Negros turning out for Sen Hagan this year, so she is toast if she cant get the votes of the stupid white folks.
Ah Rick, I was wondering when your bigot pills would run out. We helped Kay’s campaign bring in another $2 million last month. Good thing y’all got the Koch brothers and Karl Rove buying your representation for you. Might want to get your ground game going, though. Y’all are pretty far behind on that.
We have ‘free’ government legal aid now in criminal cases if we can’t afford an attorney to represent us (and those costs could be as prohibitive as healthcare in many cases). Imagine what kind of Doctors you’re going to get if the Government provides ‘free’ medical care.