Tag Archives: Obamacare

Trump One Step Closer to Quitting

Reference:

I believe Donald Trump will quit the Presidency of the United States. I forecasted Trump would win (see April 2016: Trump Will Eat Clinton Alive), and in that article last Spring I suggested that he would quit. He will quit due to the inability for politicians in Washington to be rational and negotiate. He will quit with acrimony and bolshiness. About the only thing that will prevent this situation from taking place is tax reform.

Let me first state that I think that Obamacare was the wrong tool for the job. It was a rushed, Ill-focused, partisan and socialist effort to undermine the best parts of America. Its namesake and his supporters suggested that the Affordible Care Act (ACA) it helps those that need most help (the uninsured), and it does (in some way) but at a system-wide cost that is unacceptable and unaffordable.

The free market is anything but that; regulation is like a strangling vine; prices remain untouched and high; big pharmaceutical remains unfettered; patient outcomes remain anathema to healthcare. This country continues to spend ever more on healthcare, more than any other developed nation per capita, and yet our outcomes and their improvement reman poor and lacking, even on a good day. Obamacare was the wrong tool for the job.

The bad news is the Republican approach to Obamacare has split its own party. Worse, the repeal and replacement was in their reach. Yet last week the chance for correction was thrown out.  

There were even votes against the Republican policy from folks like Ron Paul who didn’t want the ‘Obamacare Lite’ but who wanted a full repeal. So he withheld his support. The Freedom Caucus, apparent fiscal hawks, had a chance to budget-fence Medicaid, yet they withdrew support in the mad hope of a perfect policy sometime in the future.  

This is madness. This is political suicide. The Democrats have been handed a free ticket and Trump must be mad. This is Washington at its worst. There will likely never be a perfect policy or time enough to develop it.

Now the movement shifts to tax reform. If an overhaul is not executed Trump will feel like quitting and he may yet do so. The Republicans need to realize that they have a rare opportunity but only if they unite. If they play party politics and splinter again, change will not be forthcoming. The Democrats, not in power of any sort, will be in power in all but name.

Obama won on the promise of change and socialists alike all rammed through their left-leaning, redistributive, anti-business and anti-free market policies. We are slowly bleeding to death now under the weight of ignorance and self feeling. Our polices cannot be paid for without printing money since we are all too happy to free-ride the masses and garrote the rest. The rest who are free and employed folks who work for a living, who want to improve their lot with their own blood, sweat and tears, not from hand-outs from Uncle Sam.

Trump also won on an argument for change. Alas the Republicans have forgotten how to govern.    

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Obamacare – The Gift that Keeps on Taking

I thought it was interesting the angle taken by two Opinion pieces in the Wall Street Journal on Matvh 17th and 15th.  Both pieces highlighted what for me is not well known or reported in the wider press.  The point being that the regulation that comprises the Affodible Care Act (ACA) was going to continue to drive a greater wedge into public finances long into the future.  According to the two articles, increased taxed and transfer payments from the federal governance were baked into the regulation or required as a result of how the regulation was to be sustained.  In other words, ACA did way more than “tackle” the problem of offering healthcare to those that did not have it; it really did tinker with the entire system on which it relies nourishment.

The perspective offered by the Wall Street Journal goes some way to explain the Republical delight in how repealing and replacing Obamacare will in fact eliminate or significantly reduce this socialist wedge that woudl have other driven our Governmetn on to ever larger formats.  We really do need to figure out how balance increasesing demands of an aging population with the need to fund a smaller government.  If the government were a business, it would long have gone out of business.  And it does not help to hear others say, “the governmetn is not a business” since, at the end of the day, it has to be funded.  We cannot just borrow forever and print money when we feel like it.  Every nation on earth that has gone this route has ended up in revolution or disaster.  We all beleive the US is different.  Let’s hope so.

 – March 17th, How to Repair Obamacare’s Fiscal Damage

 – March 15th, The Health Bill’s Fiscal Bonus

Healthcare under TrumpĀ 

Healthcare’s Bipartisan Dilemma” in today’s US print edition of the Wall Street Journal  details several ideas and alternatives being discussed that might replace the ACA. Every example considers tweaks to the current system that abuses the market based approach. As with the ACA, the costs to cover sick folks is mashed together with the larger population of healthy people. The result, as with the ACA, is massive price and market distortion. In fact the very essence of risk (with respect to insurance and premium) is undermined. As such the free market is a monster.

There is a different way that should be considered yet it is not (yet) in the news. Literally, return the market to where it was: remove the entire ACA and permit risk to be priced into he market as it was.  

For those that fail to get insurance, offer a subsidized state-health insurance. This is the equivalent of the UK’s National Health Service but at a state level. Federal funds and state taxes would be used to pay for the service. This idea was floated in the run up to the ACA being signed and this represents a simple subsidized pool. It would be transparent and visible. The costs of this aspect of healthcare would be clear.

Finally another issue in healthcare needs to be addressed at the same time: costs. Additional efforts need to be enhanced to shift the reward system for healthcare, public (Medicare, Medicaid etc) and private. Rewards need to be explicit and focused on health, not piece-rate and work. Visits to the doctor and specialist are not relevant; results are. This program needs to be led by business people in Washington, not politicians.

Along with this is a revamp of regulations to help reduce the risk of insurance against negligence. This part of the industry puts too much of a burden on costs and needs to reduced.   

Against the Gods: Obamacare Comes Up Short

Against the Gods: The Remarkable story of Risk is a classic. It seems the Democrat, President Obama did not read it. Greg Ip’s article in today’s US print edition of the Wall Street Journal, titled “Obama Health Law’s Instability Is Intrinsic” does a nice job exposing the fallacy of the Affordable Care Act. And it has nothing to do with the social need to offer healthcare to those that can’t afford it.

Mr. Ip shows clearly how the ACA distorts the insurance market and limits how insurers price risk. Insurers are no longer allowed to differentiate as much across different risk groups. For example, if you have a teenager at home your motor vehicle insurance goes up; if you are elderly your health care risks tend to be higher so your insurance goes up. They still do differentiate but now are limited in the scale that used to work and fund the market. Now those limits are forcing risk premiums to be neutralized and the result is two fold:

  • The healthy are paying more than their risks warrant 
  • The sick are flocking to the insurance system (though mainly due to the use of pre-existing conditions being waived)

The unintended consequences are that the healthy are now leaving the system or downgrading health coverage. And costs are going up as the number of healthy to non- healthy members declines.  Insurance companies have no choice but to leave the system, which just reinforces the cycle.  We don’t need more policy and red tape to tinker with the system.  We need a rethink.  And it’s not that hard.

Insurance is broken. The market has been massively distorted. The problem is Obamacare. It was a policy focused on breaking the market and forcing government intervention. It created increased governmental costs, and so larger government. The system is broken.

Knowing what we now know, and if we had listened to some of the economists back then, we should never have passed Obamacare. We should have done two other things:

  1. Focused on changing how established programs like Medicare and Medicaid reward patient wellness, rather than focus on workload.  This would have helped address the big issue of costs in healthcare indirectly by focusing on the most important outcome.  Too many politicians want to create new rules and overheard to control costs directly (which is another fallacy – think Freakonomics).
  2. Establish a funded healthcare safety net for those that cannot afford private insurance through taxation and the money since spent on red tape and healthcare administration. This could even have been a federally devolved system funding a state-level safety net.  It did not need anything as large, complex, costly or disruptive as Obamacare.

Alas we have another example for how capitalism has been abused, under the guise of what some might call progressive and socialist policy. Again it is not capitalism that is broken; it is the ideas of the people that get into a position of power on the backs of The Myth of the Rational Voter (another classic well worth reading).