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Wednesday, June 17, 2015

Let's be realistic about repealing ObamaCare

Posted by Scott Tibbs at 4:00 AM (#)


One of the issues that will be debated in the next election - especially the primary - is how Republicans should go about repealing ObamaCare and whether incumbent Republicans have been committed enough in the effort to repeal it. But we need to be realistic in how we go about it and how we expect our elected officials to act.

Here are a few proposals to make the current law better:

  • Offer current ObamaCare enrollees unlimited medical savings accounts that roll over indefinitely. Subsidize those savings accounts.
  • Pass a dollar-for-dollar tax credit on medical expenses.
  • Allow insurance companies to operate in all states and across state lines without restriction.

Let's be realistic here: A straight up repeal will never pass. It should, but it will not happen. We can reform ObamaCare and make it better, with the ultimate goal of repealing it and replacing it with something else. But those reforms will have to be passed piece by piece. First, we have a presidential veto that we cannot get passed until at least January 2017. Even if we get a Republican President then a full repeal will not get through a filibuster. Like it or not, it will be a ten or twenty year project to repeal this monstrosity piece-by-piece.

We can look to the past for examples of what to do and what not to do in repealing ObamaCare. For example, there were some good ideas in the 1990's to reform Medicare. One of these was allowing seniors to choose a different delivery system for their benefits, but it was explained poorly and Republicans were wholly unprepared for (and wholly naïve about) the attacks on that proposal and the people proposing it. A similar reform could be proposed for ObamaCare, though it must be handled better than the Medicare proposal was handled.

It is true that Congress could simply refuse to fund ObamaCare, and fully fund the rest of the government. Let Obama and the Democrats choose to shut down the government and stand your ground. But that is not realistic. Our leadership in both houses, and a significant portion of the membership, does not have the stomach for that. If that were to happen, it would need to be planned well in advance with a unified Republican Party that is prepared for the attacks and disciplined in its message. None of those prerequisites exist.

Finally, we need to be honest with ourselves: An entitlement has never been eliminated in the history of our nation. The odds are against repealing this one, simply because of the political realities in Washington. We can make this better, less intrusive and less oppressive, but we can only do it a little bit at a time.

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At June 17, 2015 at 1:58 PM , Blogger TableTopJoe said...  

Mr. Tibbs, a few questions:

1. When you say that you want to offer current ObamaCare enrollees unlimited medical savings accounts that roll over indefinitely and are subsidized, I'm a bit confused. Specifically, I would like to know what you mean by "unlimited medical savings accounts that roll over indefinitely." Does that mean that a billionaire can indefinitely stash money away in such an account tax free? How does that solve anything remotely related to healthcare? Further, if your problem with the Affordable Care Act is that it is an "entitlement," then how would you characterize the subsidies to these accounts? Also, who gets subsidies? Everyone or just the means-tested? I guess I don't get why you believe that this will either (1) get healthcare costs under control or (2) increase access to healthcare.

2. A dollar-for-dollar tax credit on medical expenses. Is this a refundable tax credit? If not, how is this much other than more tax breaks for the wealthy (a favorite conservative hobby horse, to be sure)? If this is a refundable tax credit, then how is this any different than socializing the medical system without imposing any monopsony advantages and thus continuing the American tradition of paying twice as much for healthcare and getting half as much as the rest of the developed world.

3. Insurance across state lines. Do you propose that the federal government then regulate insurance? You are aware that the states currently regulate insurance (i.e. Indiana Department of Insurance). Is it your position, sir, that the federal government can regulate insurance better than Indiana can? Or is it your position that the least-regulatory state should be able to set standards for Indiana? Do you believe that bureaucrats in Texas, California, New York, Arizona, Florida, or Washington, D.C. have a better understanding of the needs of the citizens of Indiana than do the duly appointed bureaucrats of the Indiana state government?

Finally, your euphamism about "different delivery system for benefits" is truly misleading. When you talk about that, does that mean that I have the option of getting my health insurance benefits through the federal government instead of through Anthem? Believe me, I would like to. It's been nearly six months since my daughter was born and I have still not gotten an accurate bill from the hospital; however, I have had the pleasant opportunity to deal with bill collectors who can't tell me (1) who I'm paying, (2) what I'm paying for, or (3) whether the amount they're demanding is accurate or even sufficient to retire the debt I carry.

I would love to have a "better, less intrusive, and less oppressive" healthcare system. I simply fail to understand how your proposed plans would accomplish that. They look, to this observer, like more of the same from the Republican party. "Deregulation and tax cuts for the wealthy! It cures what ails ya! Recession? Deficits? Surpluses? Bubble? Good times? Bad times? Sunshine? Rain? Heat? Cold? Cut those taxes, cut that regulation. Good times always follow!" (except those few isolated instances when they haven't, like every time it's ever been tried)

At June 17, 2015 at 6:10 PM , Blogger Scott Tibbs said...  


Does that mean that a billionaire can indefinitely stash money away in such an account tax free?

Since one cannot use The MSA for anything other than health care expenses, I doubt billionaires would be avoiding tax liability and save some money by placing a much larger portion of their money in an account where they cannot legally access it except for a medical expense.

It will benefit the middle class and the poor that struggle to pay medical bills.

Further, if your problem with the Affordable Care Act is that it is an "entitlement," then how would you characterize the subsidies to these accounts?

That's just a recognition of political reality. Instead of paying for insurance, give people direct "cash" that they can use as they see fit. We're not going to be able to eliminate the subsidies, so this is a more market-based alternative that will lower costs through competition for customers. In a perfect world everyone would pay their own way but we don't live in a perfect world.

Politically, you're not going to replace subsidies for insurance coverage with nothing.

The subsidies would be means-tested.

The tax credits would also be a way to insert competition into the system and would lower or eliminate the tax burden on the poor or middle class struggling to pay medical bills.

Insurance across state lines. Do you propose that the federal government then regulate insurance?

No. I am proposing making it illegal for states to restrict as many insurance companies from operating as want to operate. Regulate within the state, but there would be no barriers to operate in any state.

Finally, your euphamism about "different delivery system for benefits" is truly misleading.

It was a very generic statement. I wasn't making a specific policy proposal here. But one possibility is to issue vouchers that people would take to the doctor, incentivizing them to shop for the best care for the best price. (Or have a family member do it for them.)

I thought the idea of offering Medicare patients the opportunity to use vouchers while keeping the existing delivery system in place was a good one. Let people choose which one they want.

At June 17, 2015 at 6:24 PM , Blogger TableTopJoe said...  

Mr. Tibbs,

I will only address a portion of your comments, as I have limited time. However, when it comes to healthcare, conservatives repeatedly speak of "vouchers" and "the market" as though they are relevant things.

If you could go into the hospital and see a pricing menu such as you see at a restaurant and make your decisions based on the price:quality ratio, generally referred to as the value proposition, perhaps the vaunted "free market" would have some relevance.

Alas, such is not the case. The current, as well as the pre-ACA status quo ante, operates much more like the robber baron-era railroads did. Pricing is not transparent; costs are shifted on a massive scale; charges are different for different customers based on who they are, not what they purchase; people get indecipherable bills for astronomical amounts AFTER they have already incurred the liability. That is the antithesis of a free market. It is a business model that Tony Soprano would envy.

A free market requires (1) a market; and (2) the freedom to participate with all of the relevant information. Where is the market? Where is the information? We only now are getting a look at the "charge master" lists precisely because of the ACA.

Until these fundamental problems are addressed, Mr. Tibbs, you will always have people like me attempting to cajole our system toward a single payer, like the rest of the developed world. Had these problems been addressed by the last three (3) Republican presidents, perhaps you wouldn't have the ACA to hate today.

At June 19, 2015 at 10:32 AM , Blogger Scott Tibbs said...  

The solution, then, is to mandate that the pricing structure be transparent. Health care is a market, though not a perfect one. For example, a lot of things went into me choosing a specific primary care physician and (more recently) a specialist.

A large problem with insurance is insurance itself, because it distorts the market by insulating the consumer from the cost of the product. Ideally, insurance should be for catastrophic coverage, while day-to-day things are paid out of pocket.

At June 20, 2015 at 2:34 AM , Blogger MonroeCountyConservative VoteConservative said...  

Sorry Tibbs. Your "realistic" conclusion is based on several "unrealistic" assumptions.

You fail to recognize that Obamacare is bankrupting the state and federal governments, not in an effort to provide affordable care, "affordable care" is a misnomer. Future it has failed to control costs. In fact it has accelerated costs.

It should have been called the "Insurance Company Enrichment, Racketeering and Protectionist Act".

Here is the future of American medicine. Watch carefully.


We don't call our car insurance claims rep every time we need to buy gas for the car, have the oil or tires changed. Those are operating expenses and regular maintenance. It is none of their business. Obamacare forces an overblown claims process even if all we need is a bit more air in the tires. And you are as a conservative are defending it as unavoidable and impossible to change?

I suppose your next article will be a plan to fix the IRS by breaking the tax code more. Here is a better plan:


Rand Paul: Blow Up the Tax Code and Start Over
Apply a 14.5% flat tax to personal income and to businesses. Cut deductions. Watch the economy roar.



At June 20, 2015 at 10:30 AM , Blogger Scott Tibbs said...  

I don't dispute ObamaCare's financial burden or failure to control costs. I would love to see ObamaCare repealed today. Ideally it would never have passed, or would have been fully repealed in 2011.

I wish Republicans would have showed the spine to just fully de-fund ObamaCare in 2011 and then stand their ground. But you go with the personnel you have, not the personnel you wish you had.

For example, it would have been great for the Cleveland Cavaliers if two of their three players had not been unavailable for the NBA Finals due to injury, but they were not going to have Kevin Love and Kyrie Irving no matter what. So they had to change their game plan.

But the realities of American politics are what they are. We're not getting through a veto, and after that we have to contend with a filibuster. But if Republicans cannot repeal the whole thing in one fell swoop (which, again, is the best solution) then there are things that can be done to make it better, or at least less bad.