Obamacare is collapsing under the pressure of its own weight. This has been predicted by Obamacare opponents since the law was first passed, and now that premiums have skyrocketed, Obamacare’s critics are gleeful about its potentially imminent collapse.
If only we could all be as happy.
Obamacare was always an intentional disruption of the healthcare payment system, which mostly consists of private insurance, Medicaid, and Medicare.
The third-party payment system (i.e., one in which neither patients nor providers pay the bills) needed to be disrupted, but Obamacare forced the American people to double down on the very system that has caused healthcare to become so expensive in the first place.
The data from 1960 through 2006 shows that the more heavily Americans depended on third parties to pay their medical bills, the higher the relative cost of healthcare. This is common sense.
A provider of any service is going to recommend higher-cost, supposedly higher-quality procedures if they think cost is no object. And for consumers with $10 and $20 co-pays, cost was no object to begin with. But at some point, the price spiral was going to come crashing down.
Obamacare’s design accelerates this process.
Insurance companies complained that the fine for not buying their product was too low from the very beginning. The young and healthy avoided buying insurance, preferring the fine, so premiums for older, sicker people have increased dramatically.
All of these results were intended. By the time of the final implosion, blame could be shifted to “private” hospitals and “private” insurance companies.
Next, since insurance companies would insist on earning profits, and since health care providers would take advantage of the customers they serve by charging outlandish prices, clearly the only solution would be single payer. The government would pay all the medical bills. With its power, it could dictate low but “fair” pricing. The middlemen would be eliminated.
The country now finds itself in a Catch 22. Healthcare is so expensive that as individual consumers, we cannot imagine having to pay for even minor procedures all by ourselves. But healthcare is so expensive precisely because we do not pay for it ourselves. The vast majority of Americans have been mistreated by the current system, even before Obamacare, and the healthcare and health insurance industries have profited from a government-distorted system and lobbied to keep it that way.
How do we get out of this Catch 22? After all, if we make policy changes to quickly end dependence on government and insurance to pay our bills, and people suddenly face high healthcare prices, there is a risk of a popular revolt that could move us in the direction of a single-payer system. That is, we risk falling into the very trap I believe Obamacare was designed to set. On the other hand, we cannot continue to rely on third-party payers, at least not to the same extent we do now.
Despite the pricing issues created by health insurance companies, conservative think tanks have too often aided and abetted liberals’ aims by being thought followers instead of thought leaders. They have looked at opinion polls that show people’s angst regarding insurance, and in an effort to put something in their legislative win column, have pushed “solutions” that are merely attempts to be the superior socialist technicians. Instead, they should have been united in a constant drumbeat that tax policy and insurance are part of the problem, not the solution.
Conservative thought leaders have presented vague plans that move in the right direction. However, there are still reasons to be wary. Obamacare’s community rating and guaranteed issue requirements are popular, and many leaders want to retain them. Such requirements would render any kind of insurance regime, not just in health care, untenable. Were more doctors to throw off third-party payers, from insurance companies to the government, the disruption and downward price pressure might be swift enough to block single-payer.
This is the positive message conservatives should be shouting from the rooftops.