America needs something better than the ACA

blog_poll_kaiser_obamacare_november_2013Many more Americans want to keep the Affordable Care Act or make it stronger (47 percent) than want to repeal it or replace it with a Republican alternative (37 percent).  I do not venture to predict how they will think a year from now when the technical problems will (presumably) be resolved and the law will go into force.

House Speaker Nancy Pelosi was right.  We won’t really understand what’s in the law until it goes into operation.   I am sure that lives will be saved by forcing insurance companies to cover people with pre-existing conditions, and I hope that a lot more people will benefit financially than will be hurt.   But even if things work out for the best, Obamacare at best is deeply flawed.

New Medical Gatekeepers.   The ACA makes for-profit insurance companies the gatekeepers between physicians and patients.  The only way to have a doctor of your choice is to find an insurer that has that doctor on its roster.

Insurance companies get even greater leverage than they have now in imposing a corporate business model on physicians.  A physician who spends too much time on sick and needy patients will not be cost-effective from a business standpoint, and may be dropped from the roster.  This isn’t new, but Obamacare locks it in.

Controlling the Wrong Costs.   President Obama is cutting Medicare reimbursements to health care providers.  At the same time he has locked for-profit insurance companies into the system, and declined to negotiate with pharmaceutical companies to lower drug prices.

This is a typical example of how things work in American life nowadays.  The people who do things that create value are being squeezed.  The people who extract profits from what others create are left untouched.

It may well be that health care providers are overcharging Medicare.  I don’t have the facts and figures to express an informed opinion either way.  It does seem to me that, for example, $800 is a lot to charge for an ambulance ride.  But I might think differently if I knew what it cost to pay for and maintain a fully-equipped ambulance, to pay for and maintain the ambulance station, and what it costs to train and pay ambulance crews and keep them available 24 hours a day 7 days a week.

But it is obvious that there is no public benefit in going through a for-profit insurance company to get a benefit mandated by government, or in paying more for a drug than foreigners pay for the same drug.

Complexification.   One of the problems with the American health care system—a mixture of employer-based insurance, individual insurance, Medicare, Medicaid and veterans’ benefits—was its complexity.   The Affordable Care Act makes it more complicated, and I think that is the main reason why the Exchanges and sign-up system don’t work.

There would not be any problems in signing up if Congress had enacted a single-payer plan (Medicare for all) or, if that was not feasible, simply expanded Medicare or federalized and expanded Medicaid.  The voluntary public option proposed by Senator Barack Obama in 2008 would have been more difficult, but still simpler than what was advocated.

ACA.navigatorsFragility.  The complexity of the system makes it fragile and prone to breakdown.  It makes it vulnerable to sabotage by Republican state governments that don’t want it to work (as shown on the map).  And it makes it vulnerable to manipulation by unscrupulous insurance companies and health care providers out to milk the system.   And it gives employers a scapegoat for cutting back on hours and benefits.

The smooth functioning of the ACA depends on the competence and good will of many different participants.  I condemn those who  try to sabotage the system, milk it for their own advantage or pretend it is the reason for what they were going to do anyway.  But a simpler system, such as universal or expanded Medicare would have been harder to undermine, exploit or scapegoat.

LINKS AND COMMENTS

Are Deaths Due to Lack of Health Insurance Seriously Underestimated? by Joe Firestone for New Economic Perspectives.  The best estimate is that 45,000 Americans die each year for not being able to afford good medical care. The number will almost certainly be less, but not zero, under Obamacare.

Your ‘Private’ Insurance Program Is Really A Government Plan by Josh Barro for Business Insider.  Barro points out that government already tries to regulate insurance so as to make the well-to-do and healthy subsidize the poor and sick.  Obamacare just carries this a step further.

Another Obamacare Deadline Blunder Is Worrying Democrats by Howard Fineman on Huffington Post.  Insurance companies will announce their new Obamacare plans early next October, right before the election.  They are likely to be broader and more varied, but also more expensive, than current plans.

Health Policy Canceled?  What We Know and Don’t Know by Charles Ornstein for ProPublica.  It is hard to guess the number of ACA winners and losers.

A Month In to Healthcare.gov, Real-Life Winners and Losers by Charles Ornstein for ProPublica.  One thing is certain.  Bill collection agencies are among the winners.

Why Two Obama Loyalists Lost Their Health Policies by Charles Ornstein for ProPublica.

Obamacare is a mess, and liberals need to fix it by Alex Pareene for Salon.

How to Rescue Obamacare’s Cancellation and Rate Shock Victims by Ryan Cooper for the Washington Monthly.

The ObamaCare Rollout and Organizational Dysfunction in the Administration by “Lambert Strether” for Naked Capitalism.  The best possibility is that it is a flawed system that represents a marginal improvement.   The worst possibility is a total disaster.  We’ll see.

How States Actively Prevent People From Learning About Healthcare Plans by Olga Khazan for The Atlantic.  That’s not to say that the Republicans are proposing constructive alternatives.  Obamacare is the former Republican alternative.  Trying to prevent it from being implemented won’t help anybody.

gop-healthcare-simplicity-rall

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