October 23, 2014

WE'LL REFORM IT, NOT REPEAL IT:

The most sensible GOP alternative to ObamaCare comes from a Senate candidate who is almost sure to lose (Michael Brendan Dougherty, 10/23/14, The Week)

The reform is based on the 2017 project, and is relatively simple. The ACA's individual mandate and the health-care exchanges go away. Instead, the government gives a tax credit (that grows depending on age) to anyone who does not receive health benefits from an employer. Young adults would get a smaller tax credit, and it would increase every decade and with every dependent child. A tax credit has the benefit of being progressive in effect, since for those with little income the credit would constitute a larger share of their overall income. It would make relatively little difference to those making bank. [...]

But the centerpiece of the plan is the creation of a 50-state health-insurance market, long the dream of conservative health-care reformers. Private insurance companies are still required to make their product work in 50 different regulatory environments, and this does not make for a healthy, diverse market.

One of the side effects of a Gillespiecare-style health reform would be a much more robust market for catastrophic insurance plans, which allow people to manage their health care in the same way most people manage insurance costs in other areas of life. Regular care could be purchased on a per item basis, and the really dangerous stuff -- hospital stays, emergency-room visits (for actual emergencies), and other health disasters -- could be covered by insurance.

Because health insurance is now a regulatory game of creating the illusion of "free" health-care items to some constituents, while allowing all the opacity and third-party chicanery that enables profiteering from medical businesses, America pays the most for its health care while receiving the least in return per dollar. It also has the most mind-numbing, ulcer-producing paperwork related to it. The Affordable Care Act actually did little to alter the incentives of the system, but tried to address it by plugging up a few holes.

What the Republicans really need is a health-care reform plan that untangles health care from employment for good. Employment-based health care may scare a few people into getting or keeping jobs that they are suited for, but it's overall effect is job lock, an insane-pricing scheme, and a net drag on innovation. Gillespiecare is a modest and (if pursued soon) achievable step in the right direction. It evens the playing field between employer-provided and individually purchased health insurance.

Posted by at October 23, 2014 12:12 PM
  

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