Health Reform: Lowering Cost is Priority No. 1
A recent article written by Kevin B. O’Reilly of the American Medical Association (AMA), argued that Republicans should focus health care reform efforts on protecting insurance gains to improve health care coverage and access. Specifically, he advocates the government provide income-based refundable tax credits or subsidies to “help make health insurance affordable.”
But while Kevin nobly desires health insurance coverage for all Americans, government programs are not the answer. The way to maximize health insurance coverage for Americans is to lower costs, not by taxing, subsidizing, and mandating your way to universal coverage. Under President Obama that’s exactly what America did to great harm to the healthcare market and ultimately to millions of patients.
Defenders of Obamacare point to 20 million new Americans receiving coverage as evidence of success. In reality, that number is roughly 16.5 million, 13.8 million of which receive coverage through the expansion of Medicaid – a government program that provides less access to care, longer hospital stays and higher mortality rates than the privately insured. In the three years Obamacare has been implemented, only 2.7 million Americans gained coverage even as 5 million lost their plans and doctors.
The best way to expand health insurance coverage is to the lower the cost, not to hand out insurance cards that offer poor quality of care. And this is accomplished mainly through deregulation, increased competition and expanded access to care.
Republicans in Congress can deregulate by repealing Obamacare taxes on health insurance plans and by repealing the Obamacare regulations on health insurance including community rating mandates, guarantee issue for those who game the system, and essential health benefit mandates that make inexpensive health insurance plans illegal.
Congress can increase competition by allowing insurance to be sold across state lines and by removing barriers to direct primary care, but more importantly by expanding premium support in Medicare and Medicaid. This will decrease the ability of the federal government to set artificially prices for the entire health care marketplace and unleash competition among healthcare providers and plans as those in Medicare and Medicaid opt for private insurance partially paid for by the government.
And finally, Congress can take steps to expand access to care by equalizing the tax treatment of health insurance between employer provided coverage and coverage on the individual market through patient-controlled health savings accounts (HSAs) that can be used to purchase insurance, pay for premiums, and act as a safeguard against lost coverage.
Under President Obama, Congress tried to expand coverage through regulation, taxes and mandates. That effort failed Americans. This time around Congress must get it right and fix our healthcare system through free-market solutions that lower cost, not by government fiat.