The one thing about Donald Trump’s newly unveiled healthcare plan that is remarkable is how poorly thought out it is. On paper it sounds somewhat intelligent but a lot of it could be worked into the existing structure of the ACA to make it less unconstitutional and more market friendly.
The use of Healthcare Savings Accounts aren’t a bad idea if people would take advantage of them. The benefits of HSA’s are that deposits are made pre-tax, any unused deposits are rolled over so no monies are lost, monies in HSA’s can be invested to grow the account, and finally tax qualified healthcare expenses deducted does not incur a tax penalty. The drawbacks to using HSA’s are that they can only be used with “High Deductible Health Plans, similar to 401K plans any monies withdrawn, for non-medical related reasons, under the age of 65 would incur tax penalties, and there are limits on amounts which can be invested. He alluded in several interviews that deductibles are what makes health insurance less user friendly, but there was nothing to encourage companies to lower this built in ‘disincentive’ to use health insurance.
The Individual Mandate, or the law that demands people purchase insurance, can be dropped without getting rid of the ACA. This is the most reprehensible part of the scheme from a constitutional standpoint — the idea of forcing an individual to purchase something he or she can’t afford, or doesn’t want, under the threat of financial penalty. Other parts of the ACA that have adversely affected small and medium sized businesses forcing them to cut, or freeze, worker hours could be dropped as well without injecting too much chaos. According to BLS statistics from 2009 to the present, 9.7 percent of part-timers worked between 25 hours and 29 hours and 7.7 percent worked between 31 and 34. In 2013, those numbers were 11.1 percent and 6.6 percent, respectively. These numbers suggest that, in not cutting employee hours to avoid penalties, the opportunities for employees to achieve more hours are diminishing. The CBO estimated, before the ACA went into effect, that full-time employment in the labor force would reduce 2 million in 2017, and by 2.5 million by 2024. So repealing the Individual Mandate and removing regulatory parts of the law that discourage workers from being able to achieve hours above 30 to 35 hours a week, are two ways to make the ACA a freer, more useful system.
Another point of allowing insurance companies to compete across state lines is one of the better suggestions from the right. Trump is correct is stating that more competition would drive down premium costs and improve overall plan products. However, the ACA doesn’t have to be repealed to achieve this. The idea of creating a price war is to to actually have a diverse competitive field as monopolies generally tend to divy up territories, agree on an industry price to protect their ‘spheres of influence’, and lobby for government regulation to freeze out competition. In a competitive market, for example, such as in the soft drink industry, prices are largely regulated by competition between brands. Coca Cola and Pepsi are very competitive between the two of them, but smaller competing brands such as RC Cola, Faygo, and others also compete for marketshare at a low enough price to regulate the overall price system for soft drinks.
The marketplace website that currently exists can facilitate free market competition. Getting rid of the individual mandate and allowing for broad competition would keep participation rates relatively stable. The breakdown of regulations, on the state level, would force many protected monopolies to provide a competitive price for the consumer. The marketplace website can be repurposed into a site that offers — what Trump mentions — information on cheaper procedures, competitive priced doctors, and information on the most price-friendly drugs.
His point on block granting Medicaid was not a point. As Medicaid is a means tested program, its funding and access are based upon provisioning the service to those most in need of it. It is more important for the Federal and State governments to manage this program to insure efficiency in order to better serve the poor.
However, for those who work a job and want single payer insurance, why not let them have it? The original ACA proposal allotted for the creation of a Public Option, so why not create one on a voluntary basis? As a competing product there are many benefits to having a single payer model exclusively for the working poor: 1) it provides affordable insurance for those whose incomes call for it, 2) it provides yet more market competition, and 3) it provides a testing ground healthcare professional apprenticeships, techniques for preventative medicine, and can be integrated into the system of university hospitals across the country.
It is easy to attack the ACA, or Obamacare, from a political standpoint as Trump and other critics have done, but the reality is that it is here, and it has been upheld by the courts. But simply seeking to get rid of it may not be as practical as trying to figure out how to make it actually work for everyone in a nation of this size. So why not instead of getting rid of it and going back to the problematic system that existed, or chucking the program for a potentially more cost-regressive national system, simply figure out a way to inject more liberty into the system to make it more employer, worker, and market friendly?