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Monday, May 8, 2017

Things To Consider About Healthcare

There are a few questions to consider about healthcare which are central to the issue.

1.  Is it more important to get health insurance for people or to get actual medical care for them?  In other words, should the goal of government policy to promote more people who can say they are insured or more people who can afford to see doctors/hospitals for actual medical care when needed.  This may sound like a question with an obvious answer.  If America wants to improve healthcare for its people, we want to make sure that people can afford to get that healthcare.  Strangely, the answer that the Democrats came up with when they passed Obamacare was that the goal should not be to get more healthcare for people but rather to get more people who have insurance.  The result has been very expensive insurance policies underwritten by massive government subsidies that have enormous deductibles that are too high for many Americans to pay.  Millions of people have health insurance but cannot afford to visit the doctor except in emergencies because they cannot come up with the cash needed to satisfy the deductible.

If the reasoning used by the Democrats in Obamacare seems wrong to you, then you need to consider the results of the new Republican healthcare bill passed by the House.  According to the CBO, the average cost of insurance will decline by roughly 15% once the bill goes into effect.  That would make the cost of overall medical care lower for most people and would mean that more cash would be available for actual medical care rather than insurance.  On top of this, there should be a reduction in federal expenditures by a net of roughly $900 billion over the next ten years which should help in promoting growth in the economy and higher incomes for the American people.  This too should expand the ability of people to get actual healthcare.

It is important to remember that not everyone will get the same benefit.  The average insurance premium will go down by 15% or so.  Some will see a decline of over 25%.  Some will see a small increase in their premiums.  On average, however, the American people will benefit.  No change could possibly make things better for everyone.

2.  Is it unreasonable to provide benefits to people who maintain their health insurance in effect?  In other words, is it appropriate that people who keep their insurance in effect end up in a better position than those who let the coverage lapse and only later come back to try an reestablish that coverage?  Again, it seems pretty clear that most people would think that the people doing the responsible thing of keeping the insurance in effect can get a benefit for doing so.  Obamacare works in that way.  If there is someone who does not have insurance and who then gets sick, that person cannot buy insurance until the next open enrollment period.  Think about what that means.  Someone who does not have insurance finds out in March that he or she has cancer and needs treatment.  That person cannot get insurance coverage until January 1 of the next year.  With that sort of a lag in treatment, people can die.  Under the new GOP bill, people without coverage can buy it, but they get hit with up to a 30% additional premium as a penalty for having let insurance lapse.  If the person is in a state that gets a waiver from the federal government, then the pre-existing condition of the cancer can also affect the premium.  On the other hand, someone who keeps his or her insurance in effect can get renewals each year or even buy insurance from another company with no impact from the pre-existing condition.

3.  Should young and healthy people be required to subsidize older and sick people in getting health insurance?  Obamacare said yes.  In fact, under Obamacare, the rate structures were such that people in the 20s and 30s were paying much higher premiums than needed so that those in their late 50s and early 60s could pay less.  The new health bill reduces that transfer of wealth from the young to the old.  That reduces premiums for the young and makes them more likely to buy insurance.  If you compare the relative incomes and wealth of those in their 20/30s to those in the 50/60s, you find that the older people have higher incomes and much greater wealth.  Obamacare had the poor subsidizing the rich.  The GOP bill ends that subsidy.  Does this make sense to you?

Of course, if you are 60 and your premium might go up because the 26 year old down the block will no longer subsidize your health insurance, you may like the Obamacare structure better.  For the country as a whole, however, ending this subsidy of the relatively wealthy by the relatively poor is a big plus.  The Democrats designed a system which was basically a transfer of wealth from the poor to the rich.  The media and the Dems never admitted this, but there is no denying the actual facts.

These three issues really control the entire debate on the new healthcare law.  Much of the discussion and debate has been based upon misinformation and outright lies from the Democrats.  Come to your own conclusions, but at least do so in light of the actual facts.

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