Tag Archives: Medicare

WHY OBAMACARE CAN’T BE FIXED AND WHAT SHOULD BE DONE ABOUT IT

from “If You’re Not Making History, You Are History” by Bob MacDonald

After seven years of bombast and bluster, the Republicans have shown they have no idea how to repeal and replace Obamacare. The problem for Republicans is that they were trying to fix the wrong thing. The misnomer is that Obamacare is a government healthcare plan. It is not. Medicare and Medicaid are government health plans, but Obamacare is nothing more than a government sponsored effort to help an insurance company market policies to individuals who do not have access to healthcare; either from their employer or an existing government program. (About 10 percent of the population.) Obamacare also expanded an existing healthcare system — Medicaid – in order to provide coverage for millions of low income individuals who could not afford private policies, under any conditions.

To achieve its primary objective, Obamacare created an “exchange,” in the form of a government website for insurance companies to list and market their policies. It is much like Amazon where companies list the products they want to sell and consumers go online to buy them. Obamacare is not government insurance, but rather private insurance offered on a government website.

In order to list their policies on the “exchange” insurance companies had to agree to issue coverage to anyone who applies, regardless of their current health or pre-existing conditions. In addition, companies could not put a “cap” on the size of any claim and (unlike most private policies) they had to offer expanded coverage for preventive care, mental health and substance abuse treatment.

This was all good for the insured, but the insurance companies – that are after all in business to make a profit – blanched at these costly requirements. The insurance companies argued that such requirements were not “actuarially sound” and, in fact, guaranteed losses, regardless how much premium was charged.

In response, the government made two promises to the insurance companies: Everyone who did not have health coverage from another source would be “mandated” to buy a policy. This would “spread the risk” and create stability. (Not everyone who bought a policy would have a claim.) In addition, the government guaranteed to reimburse the companies for any losses they might incur by participating in Obamacare. (What company would not want to participate when the government did the marketing of the policies and guaranteed to cover the losses?) Beyond that, the government agreed to subsidize premiums for those who could not afford what the companies were charging.

So what was intended to be a simple process of connecting customer and company to provide individual health insurance via the Internet turned into a complicated, confusing and cumbersome plan that satisfied no one. While it is true that since the inception of Obamacare over 22 million previously uninsured Americans have been able to access health coverage, the vast majority of the newly covered resulted from the simple step of reducing the bar for lower income and the poor to be covered under Medicaid.


Those opposed to Obamacare argue that it is in a “death spiral” and that it will soon collapse. They point to escalating premiums and suggest the individual market is melting down because more and more companies are withdrawing from Obamacare. They are right about all this, but it is a man-made not structural problem. Ever since the Republicans took control of Congress and now the White House, they have been threatening to repeal the “individual mandate,” eliminate subsidies to individuals and de-fund the government’s promise to subsidize insurance company losses. Insurance companies need market stability to properly price the policies to make a profit, so no wonder that under these threats they are withdrawing from Obamacare. (How many companies would continue to offer their products on Amazon if Amazon had requirements that guaranteed losses with each sale?) Because of the uncertainty of the rules going forward, insurance companies have only two options: significantly increase existing premiums and refuse to issue new policies.  

REPEAL AND REPLACE OBAMACARE

Obamacare was never the best way to assure that all Americans, regardless of their income or status in life, receive basic healthcare. And there is a better way to achieve this objective, without having to reinvent the wheel. It is a proven solution that is right in front of us.

Medicare and Medicaid have provided millions of Americans with efficient and effective healthcare for decades. If the objective is to assure all Americans – regardless of income or age – the right to basic healthcare coverage (as it should be) the simplest, most effective and least expensive way to do so is by merging Medicare and Medicaid into one program that could provide basic healthcare for all Americans from birth to death. This could not happen overnight, but it could be phased in over the next decade.

Critics argue that the cost of such an approach would be daunting, but by basing premiums, deductibles and co-pays on the basis of means and by diverting monies expended in the current patchwork health care system, the costs would not only be manageable, but less than what is being spent now. Besides, if we can spend $2.4 trillion on wasted wars in Iraq and Afghanistan shouldn’t we be willing to invest in the good health of all Americans? Such a program of universal healthcare would not be “government provided” care, but rather government payment for the services of private providers; just as Medicare and Medicaid do today.

It may surprise you that one well-known politician has long favored this approach to healthcare. In his book The America We Deserve he wrote, “We must have universal health care… Our objective should be to make reforms for the moment and longer term, to find an equivalent of the single-payer plan …” In multiple interviews and public comments over the years he has consistently endorsed the right of all Americans to receive basic health care coverage. In February of this year, he praised Australia’s health care system, saying to the Australian prime minister, “You have better health care than we do.” Of note is that Australia has a universal health care plan that is modeled after American Medicare and even called Medicare. Of course the individual referred to here is none other than Donald Trump.

Medicare and Medicaid provide access to efficient, effective healthcare for millions of Americans, so rather than constantly haggling over fixing failure, why not build on the proven success of established programs that could provide healthcare for all Americans?

Trump is Right: Healthcare is Complex, but it does not have to be

from “If You’re Not Making History, You Are History” by Bob MacDonald

 

No doubt about it, the healthcare system in America is a mess. Obamacare is not working as intended and the proposed Republican replacement is being castigated, even by Republicans, as potentially even worse. Democrats complain the American Health Care Act (ACA) takes too much away from people who need coverage the most. Republicans who oppose the ACA call it “Obamacare-lite” and complain it does not go far enough to repeal Obamacare; and that it creates an entirely new entitlement program.  

The reality is that resolving the healthcare challenge is simple, but it is made complex because Republicans and Democrats have diametrically divergent views on what the end result should be. In simple terms, the Republicans believe the answer lies in assuring that all Americans have “access” to healthcare coverage, while the Democrats believe the answer lies in assuring that all Americans actually have healthcare coverage. There is a big difference between having access to healthcare coverage that an individual needs but cannot afford and providing the needed coverage, regardless of the ability to pay.

This difference exists because the political leaders have failed to address and resolve the most fundamental healthcare question: Is basic healthcare a right or a privilege?

The Republicans believe that healthcare is a privilege, and thus, so long as there is universal access to healthcare coverage (no matter what form or price), the problem is solved. (It should be noted that prior to becoming president, Trump consistently argued that healthcare coverage is a right.) On the other hand, Democrats take the position that every American citizen, regardless of financial status, has a right to receive basic healthcare.

It is this philosophical difference that motivates the Republicans (believing healthcare is a privilege) to propose in the ACA that Medicaid (the state/federal plan that covers low income citizens) funding be slashed. (This is one of the chief reasons why the Congressional Budget Office estimated that as many as 24 million Americans will lose their coverage under the Republican plan.) Conversely, (believing that healthcare is a right) the Democrats used Obamacare to expand Medicaid that covered 15 million people who previously could not afford coverage of any type.

There can be no effective bipartisan agreement on the best form of a healthcare system, unless or until there is a debate and resolution of the question as to whether healthcare is a basic right of every American citizen or a privilege based on means to pay. If, as a society, we decide that healthcare is indeed a privilege, then the Republican ACA plan will work just fine. If, we as a society decide (as virtually every other industrialized nation has) that basic healthcare, like a basic education, is a natural right of every American citizen, then we can work together in a bipartisan way to find the best way to achieve that goal.

Repeal and Replace Obamacare

Ironically, if it is decided that healthcare is a basic right, it would call for the repeal and replacement of Obamacare, because it has failed to achieve the objective of covering all Americans. But such a replacement would be based on the rights of all, rather than the privilege of a few to have healthcare.

If this approach to repealing and replacing Obamacare is taken, the solution is right in front of us. It is a healthcare system already in operation. It has proven to be effective and efficient; it has high consumer satisfaction and acceptance. Maybe even more important, it is a plan that President Trump has endorsed and pledged to protect.

Taking the complexity out of the healthcare solution.

The simplest and most effective way to solve the healthcare crisis is to merge the Medicare and Medicaid systems into one program that, on a phased in basis, will provide basic health care services to every American citizen, regardless of age, social status or income.

There would be no need to create another bureaucracy. Both of these programs have processes and procedures in place and in point of fact are paying for the health services provided by clinics, hospitals and doctors for millions of Americans age 65 and over, along with millions more of low income citizens. Patients covered by Medicare are free to select any of the 95 percent of the doctors, clinics and hospitals that accept Medicare payments. This is not the government deciding or providing the healthcare, but simply being the “single payer” of the benefits provided.

Of course merging and expanding Medicare and Medicaid into a universal healthcare system can’t be done with a flip of a switch, but an organized phase-in of this system over time for those not currently covered under Medicare or Medicaid could smooth the way. This would allow for Obamacare, along with all other forms of healthcare such as individual and employer group plans, to be repealed and phased out at the same pace the new system is expanded.

Certainly there will be concerns about the cost of such a change, but a number of serious studies have concluded that diverting all expenditures on the current system (federal, state, individual and employer) toward this new system and combining this with premiums, deductibles and co-pays based on income, would create more efficiency and actually be less costly than the current system. President Trump has even made this point in interviews.

Using this approach to fixing the healthcare system could be a win-win for everyone. Trump and the Republicans could fulfill their campaign pledge to repeal and replace Obamacare; Trump could remain consistent in his call for universal healthcare and his pledge to protect Medicare and, most important, all Americans could finally join the millions of citizens of every other industrialized nation in the world for whom basic healthcare is a right of citizenship, not just a privilege for the wealthy.

Trump Should Focus on Replacing Obamacare

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A cornerstone of Trump’s campaign for president was the promise he would repeal and replace Obamacare. And rightly so, because Obamacare is an unmitigated failure. The promise of Obamacare was to provide “patient protection and affordable healthcare” for some 40 million uninsured Americans. The plan has failed on both points.

The saga of Obamacare is a great example of wanting to do the right thing, but going about it the wrong way. Obamacare as we know it came about because President Obama capitulated to the merchants of the devil – the health insurance industry – in order to strike a deal on healthcare reform. The great myth surrounding Obamacare is that it is some type of government provided healthcare coverage like Medicare, but it isn’t. Under Obamacare the government has nothing to do with the type of coverage offered, the quality of the services provided or the cost consumers pay for healthcare; that is all left up to the whims of private health insurance companies.

Obamacare is nothing more than a (clunky, complicated) website that is intended to match-up those who need healthcare coverage with private, for-profit insurance companies looking to sell their policies. The only requirement for insurance companies to market their policies on the “exchange” is that pre-existing conditions are covered and children can be included under the policy until age 25. Beyond that, insurance companies are free to determine the structure of the policies, the provider networks the insured must use, deductibles and the co-pays – the amount the insured must pay out of pocket; and those can run as high as 40 percent of medical charges. Most important, the insurance companies are free to charge any premium they desire and increase those premiums at will. In short, Obamacare has become nothing more than a profitable boondoggle for insurance companies. As usual, the ones left holding the short end of the stick are individuals who most need and can least afford healthcare coverage.

In addition, employers who are mandated to provide employees with healthcare coverage are free to use all sorts of machinations to avoid this responsibility. (For example, hiring employees as part-timers and making sure they work less than 40 hours a week.) This forces the employees to use the Obamacare website and be pillaged by the insurance companies.

Be careful what you wish for …

With a Republican soon to be in the White House, the Republicans in Congress who believe healthcare is a privilege based on the ability to pay, rather than a right of citizenship, are stupid-drunk giddy over the prospect of killing Obamacare, but they need to be careful what they wish for. There may be one problem that could turn their dream into a nightmare. While that Republican soon to be in the White House has savaged Obamacare, he has consistently supported the rights of every American to have healthcare coverage. Over the years Trump has repeatedly praised the concept of universal healthcare.

On 60 Minutes Trump said, “Everybody’s got to be covered. This is an un-Republican thing for me to say because a lot of times they say ‘No, no, the lower 25 percent that can’t afford private.’” He continued, “I am going to take care of everybody. I don’t care if it costs me votes or not.”

On the Larry King Show Trump bluntly proclaimed, “If you can’t take care of your sick in the country, forget it, it’s all over … I believe in universal healthcare.”

In his book The America We Deserve Trump wrote, “We must have universal healthcare … I’m a conservative on most issues but a liberal on this one. We should not hear so many stories of families ruined by healthcare expenses …”

So the Republicans in Congress may be in for a bit of a surprise blowback from their Republican president when it gets down to the nitty-gritty of repealing Obamacare, without offering a reasonable alternative for millions of Americans who lack access to healthcare or don’t have the ability to pay the exorbitant premiums charged by private insurance companies.

What is the alternative that Trump could propose?

If Trump is sincere in his belief that all Americans should have affordable access to basic healthcare services, he could achieve that goal by simply expanding the scope of two healthcare plans already in existence – Medicare and Medicaid. Medicare provides effective and efficient medical care for millions of Americans age 65 and over. Medicaid – a combination of state programs funded by the federal government – provides medical care to millions of low income individuals.

The point is that these two programs have processes and procedures in place and in point of fact are paying for the healthcare provided by hospitals, care givers and doctors for millions of Americans. Patients are free to select any of the 95 percent of hospitals and doctors who accept Medicare payments to provide their care. This is not the government deciding or providing the healthcare, but simply being the “single payer” of the benefits provided by private hospitals and doctors.

So the question is: Why not repeal Obamacare and replace it with the two national healthcare programs already in existence and functioning effectively? There is no need to create an entirely new bureaucracy. The simplest and most direct way to offer basic healthcare to all Americans at affordable costs is to expand and enroll everyone – at all ages – into Medicare or Medicaid.

Of course, this can’t be done with a flip of a switch, but an organized national phase-in of Medicare over time could make it happen. For example, in the first year those 60 to 65 would be eligible for Medicare, then the next phase would include those 50 to 55, and so on until everyone is covered. This would allow for Obamacare to be repealed and phased out at the same pace Medicare is expanded.

This approach could be a win-win for everyone. Trump and the Republicans could fulfill their campaign pledge to repeal Obamacare; Trump could remain consistent in his call for universal healthcare and, most important, all Americans could finally join the millions of citizens of every other industrialized nation in the world for whom basic healthcare is a right of citizenship, not just a privilege for the wealthy.