Replace ObamaCare, Stat
March 11, 2014
We cannot wait until 2017 to reform ObamaCare, says John Goodman, president and CEO of the National Center for Policy Analysis and a senior fellow with the Independent Institute.
Goodman outlines the elements that form the basis of his proposal to reform the U.S. health care system. More progressive than ObamaCare, Goodman explains why his reforms would provide genuine access to care and protections for those with preexisting conditions.
- Choice: There should be no health insurance mandate, and Americans should be able to choose whatever type of health plan they need.
- Fairness: Goodman suggests offering a tax credit to anyone who purchases insurance that is the same for everyone. Moreover, making income irrelevant would eliminate the link between health insurance and the IRS and other federal agencies. Insurance companies could sign people up for health insurance without asking questions about their income and assets.
- Jobs: The problems that ObamaCare is creating in the labor market would vanish with a uniform tax credit and no mandate. Businesses would not be incentivized to stay small and avoid hiring, and there would be no incentive to shift employees to part-time work. Employment costs would also drop (thereby encouraging hiring), because the tax credit would do away with the perverse incentives that currently exist for employers to purchase wasteful insurance. As it stands now, employers receive greater tax benefits when they purchase more costly insurance.
- Universality: Most of the uninsured will still remain uninsured under ObamaCare. But with a tax credit system, unclaimed tax credits could be sent to safety net institutions in communities with large numbers of uninsured. These funds can be used to pay for uncompensated care when the uninsured cannot pay their health care bills.
- Portability: Today, it is illegal in most states for employers to buy employees insurance that travels with them from job to job. This is also largely responsible for the preexisting condition problem. Instead, employers should be allowed to provide portable insurance, similar to a 401(k).
- Patient Power: 30 million people today have health savings accounts (HSAs) and health reimbursement arrangements, and they control costs and eliminate waste by putting health care decisions into the hands of patients. The RAND Corporation estimates that if these plans see even more widespread use, the United States could see up to 30 percent savings in health care costs.
- Real Insurance: ObamaCare is destroying the individual insurance market, as states, cities and counties dump high-cost patients into the exchanges. Because of community rating and guaranteed issue, insurers cannot charge premiums that actually reflect the cost of enrolling a specific enrollee, and insurance companies are doing all that they can to avoid the sick. Patients are losing access to care because insurers are competing in a market of perverse incentives.
Source: John C. Goodman, "Replace Obamacare, Stat," National Review, March 24, 2014.
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