Yesterday The Heritage Foundation posted their evaluation of the bill to replace ObamaCare. Admittedly, The Heritage Foundation is a politically conservative group, so their solution to ObamaCare would be aimed at shrinking government, not just moving the chairs around.
The article lists some of the problems with the bill:
Basically, the bill focuses on protecting those who gained subsidized coverage through the law’s exchange subsidies and Medicaid expansion, while failing to correct Obamacare’s misguided insurance regulations that drove up premiums for Americans buying coverage without government subsidies.
That is both a policy problem and a political problem.
The article goes on to explain that the people who need relief from ObamaCare are the people whose premiums and deductibles rose dramatically. That is the group the does not get relief in the new bill. The new bill leaves costly regulations in place and attempts to offset those costs with subsidies. That is what most Americans want to get rid of.
The article explains:
In that regard, the draft bill’s new “Patient and State Stability Fund” is particularly problematic. That program would provide grants to states of up to a total of $100 billion over the nine years 2018-2026.
There are a several significant problems with this new program.
First, it substitutes new funding for old Obamacare funding without adequately addressing the misguided Obamacare insurance market rules and subsidy design that made the exchanges a magnet for high cost patients.
Those mistakes in Obamacare created an insupportable burden on the individual insurance market by concentrating expensive patients in only that small portion of the total market.
Second, like Obamacare, it doesn’t actually reduce premiums, but rather masks with subsidies the effects of Obamacare provisions that drove up premiums in the first place.
Third, it creates a new entitlement for states. Furthermore, without a resulting reduction in unsubsidized premium levels, future Congresses will likely face pressure from states and constituents to extend and expand the program.
That is exactly backwards from what is needed.
The new healthcare bill also fails to reign in Medicaid.
The article reports:
Under the Medicaid expansion, the federal government reimbursed states 100 percent of the cost of expanding Medicaid to able-bodied adults, with federal support eventually declining to 90 percent.
Yet, states continue to receive significantly less federal assistance (50 percent to 75 percent, depending on the state) for covering the more vulnerable populations (such as poor children and the disabled) that the program was intended for. That policy was both inequitable and unaffordable.
The draft bill does not correct that inequity, but rather reduces the enhanced match rate from 95 percent to 80 percent. The better approach would be to allow states to immediately cap expansion population enrollment, while also setting federal reimbursement for any new expansion enrollees at normal state match rates.
Please follow the link above to read the entire article. There are three things that need to happen with health insurance in America–the policy needs to be attached to the person–not their employer, policies need to be portable across state lines, and people with pre-existing conditions need to have a way to be insurance. Other than that, the government needs to get out of the healthcare business and let the free market rule. It will be bumpy for a short while, but if we don’t do it now, things will only get worse.