Tag Archives: health care

Tax Credits in the Obamacare Replacement Proposal

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In the main, I’m opposed to these on a couple of grounds.  One is that it’s just more welfare; we need to find a way to move folks off welfare and into the labor force and jobs rather than keeping them trapped in the welfare cage—like we did when we originally reformed the food stamps program by requiring recipients to get a job or lose the stamps.  That reform not only reduced overall unemployment, it put recipients back into jobs (and off that welfare program).  These weren’t make-work jobs, either; net prosperity for those recipient families increased.  (Then the Obama administration withdrew the work requirement, and we got record numbers of folks back on food stamps).

The (refundable) tax credits are just more of this sort of subsidy, just in the form of a tax credit rather than a direct payment, like most subsidies are.

The other is that the tax credits won’t encourage health coverage providers to lower their rates and deductible requirements.  Quite the opposite, the credits would prop up those costs by allowing the providers to put a commensurate fraction of their charges onto the taxpayer: the credits would be used by the providers to make up the difference between what the coverage purchaser pays and what the provider charges.

On the other hand, the tax credits would approach acceptability under a couple of conditions: if the credits decline year-on-year to a final value of zero over some number of years, say, two or three; or the credits are sunsetted and disappear after some number of years, say two or three.  Or a combination of the two.

With those conditions, and with the understanding that both individual and State budgets need time to adjust, a disappearing tax credit, by providing that adjustment time, could become acceptable.

Call Them on Their Obstructionism

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Heather Higgins, CEO of Independent Women’s Voice, says go big or go home regarding Obamacare.  Republicans in Congress should quit dithering, should not play reconciliation games, and should simply put an Obamacare repeal and replace package up for vote.  This would force the Democrat obstructionists—especially those #NeverTrumpNoHow and #NeverRepublicanNotEver Progressive-Democrats in the Senate on the record as by-name blocking reform of the Obama program that is in its death spiral, the endpoint of which will leave millions of Americans without health coverage and without even coverage providers to which to appeal.  Especially put those 10 Progressive-Democrats pretending to moderacy in order to protect their precarious reelection chances in 2018 on the spot.

Now that insurers are acknowledging the death spiral, there’s an opportunity for bolder action. The House could use regular order, not reconciliation, to pass a bill that not only fully repeals ObamaCare—returning control of the private market to the states—but simultaneously puts into effect at least the core components of reform while including grandfathering and other provisions to smooth the transition to lower-priced options on the free market.

Such a bill could easily pass the House, putting pressure on the Senate. Would Minority Leader Chuck Schumer allow proper consideration of much-needed health-care reform? And with all the evidence that ObamaCare has been a disaster and—untouched by Republicans—is quickly unraveling, would Democrats, 25 of whom are up for re-election next year, vote to defend the status quo?

And

There would be two Senate filibuster points—the first, to allow consideration; the second, to allow a vote. Thinking through what would happen, the American public and Trump administration would be well served by this exercise of transparent democracy.
…
If Democrats blocked consideration of the bill, they would do President Trump a favor by showing the public the parliamentary shenanigans of the anti-deliberation filibuster—call it the “Senatorial Full Employment Through Avoiding Tough Votes” maneuver.

And

If Democrats refuse to allow debate, Republicans should kill the filibuster against deliberation (as distinct from the filibuster to end debate and hold a vote). They can do so by simple majority vote, as Harry Reid showed when he ended the filibuster against most nominations in 2013. Either way, the Senate can actually have a vote on repealing the Affordable Care Act and reforming health care.

Republicans should heed this advice, and go for it.  If it fails, Republicans can always go the reconciliation route.

What Should a Health Plan Cover?

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Anna Wilde Mathews wondered about that in her piece in The Wall Street Journal.  First, a couple of asides.  Notice the tacit acknowledgment that we have no health insurance plans available.  That industry was eliminated in toto by Obamacare, which replaced the industry with a Federally mandated, publicly/privately funded health coverage welfare program.  Next, notice the tacit assumption in the piece’s subhead: that the law should mandate business decisions.

To the piece itself:

The 2010 health law created a new set of federal requirements for plans sold to individuals and small businesses, including a list of 10 benefits, among them prescription drugs, mental-health services and laboratory tests. It also mandated that plans cover preventive services such as vaccinations at no cost to enrollees.

Along with women’s contraceptives (but not men’s…) at no cost to enrollees or the businesses providing the plans.

Trimming certain benefit categories from the required list could sharply raise the cost of those benefits for consumers who opt to have them.

That’s Mathews’ claim, anyway.  What she’s chosen to ignore is that a competitive, free market would sharply reduce the cost of most of those “benefits.”  What she’s also chosen to ignore is that eliminating the mandatory nature of the coverages would sharply lower the cost to millions of others who don’t need those “benefits,” but who must pay for them anyway—even if they’re included in a plan at “no cost to enrollees,” a fiction cynically foisted onto us by the Obama administration.  Enrollees certainly are paying for them; the added cost is simply hidden in a higher overall price.  And the rest of us are paying for them, too, in premiums similarly elevated to pay for that required coverage and/or in the taxes we must pay to pay for the subsidy.

It’s certainly true that other, rarer or more expensive to treat problems would have higher prices, but there’s never been a case made for why Government should pay for these ahead of family, friends, charity, church, local community—the usual suspects.

Plans with skinnier coverage can carry lower premiums, actuaries say. But as with everything in health care, that comes with a trade-off.

NSS.  But those trade-off decisions belong to the individual, not to Government.

Four Pillars of a Health Care System?

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The Wall Street Journal posited this in a Wednesday op-ed.

1. Provide a path to catastrophic health insurance for all Americans.

The WSJ then supports this with old saws: being covered generally leads to better medical results, health insurance is good for the wallet, and so on.  Then they want a government solution—while they carefully avoid saying how they would pay for it:

The ObamaCare replacement should make it possible for all people to get health insurance that provides coverage for basic prevention, like vaccines, and expensive medical care that exceeds, perhaps, $5,000 for individuals.

Those Americans who don’t get health insurance through employers, or Medicare and Medicaid, should be eligible for a refundable tax credit….

They don’t even say why catastrophic health insurance should be particularly targeted by Government.  They ignore an actual market solution for this: free market competition, accompanied with lower tax rates (which leave more money in people’s pockets), and no annual or income caps or requirements for high deductible insurance plans (and no requirement for any insurance plan at all) on Health Savings Accounts.  Folks are fully capable of making their own decisions about the structure of their health insurance plans without the Know Betters of Government holding them by the hand.  And insurance companies, in a fully competitive environment, are fully capable of developing and delivering the products actual customers want without Government mandates.  If that includes catastrophic insurance plans, those will appear.

2. Accommodate people with pre-existing health conditions.

See above regarding free markets.  Of course such coverage would come at a higher cost than other sorts of health coverages; the risk being transferred to the insurer is higher.  But even this risk is not certain.  Folks who’ve had a heart attack (or more than one), for instance, have a preexisting condition (unless a single heart attack has occurred sufficiently far in the past that a medical doctor (the patient’s, not the insurer’s or a Government hireling) says it’s a one-off and not preexisting), but not everyone who’s had heart attacks will have their next one simultaneously.  Even a preexisting condition can be amortized across time given a free market that allows pooling of [those who’ve had heart attacks] so that premiums can be adjusted to match the actual payout requirements, the actual risk—just like “ordinary” insurance plans.

So as long as someone remains insured, he should be allowed to move from employer coverage to the individual market without facing exclusions or higher premiums based on his health status.

This conflates two separate questions.  The preexisting question is addressed just above.  The mobility of an insuree (or someone who’d like to buy a health insurance plan) is separate: and yes, in a free market environment, an insuree would be able to take the plan he’s purchased, whether originally obtained through his employer (unless it was the employer who actually did the purchase and the premium payments) or bought on the individual market, with him wherever he went or to whatever job he moved.  The latter case, too, would reduce or eliminate the need for the new employer to offer health insurance coverage through his benefits program.

3. Allow broad access to health-savings accounts.

There should be a one-time federal tax credit to encourage all Americans to open an HSA and begin using it to pay for routine medical bills. And HSAs combined with high-deductible insurance should be incorporated directly into the Medicare and Medicaid programs.

Another Government solution—again carefully unpaid for—and it’s much too timid.  I addressed HSAs and their market availability above.

4. Deregulate the market for medical services.

This is the only move necessary.  It’s the move to enable the free market solution.

Full stop.

Obamacare’s Cost Increases

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As even President Barack Obama (D) has finally confessed, Obamacare plan premiums and deductibles are skyrocketing.  But the Democrats and their Progressive fellows are cynically obfuscating the matter.  Here’s a typical remark, by HHS’ Assistant Secretary for Public Affairs Kevin Griffis:

Headline rates are generally rising faster than in previous years…headline rates are not what they [recipients of Obamacare subsidies] pay.

Indeed not.  Those rates are what you and I and our fellow taxpayers who don’t get subsidies pay, and they’re rates for which we pay a second time in the form of the subsidies Obamacare passes on to potsful of Obamacare plan purchasers.  We pay for those subsidies with our tax payments.

This is carefully elided by those pushers of Obamacare.