Trump & ObamaCare — What Went Wrong

As you know, President Trump’s plan to “repeal and replace” ObamaCare failed yesterday. Although this is a diversion from our usual focus on The Controversy between evolution and creationism, it’s a good subject for the weekend.

We touched on the topic several years ago, in The Curmudgeon’s Health Care Reform Plan. That was a few months before ObamaCare became law. The ideas we presented there still make sense for reducing the cost of health care.

Now that Trump’s attempt has gone nowhere, it’s appropriate that we stir things up by giving you our Curmudgeonly view of the fiasco. We know that most of you won’t agree with us, but we’re used to that.

First, the “repeal” part of Trump’s plan makes sense — at least to us — because ObamaCare is a failure. Repealing it could have been done easily. The real problem was the “replace” part. It doesn’t surprise us that the Republicans in Congress couldn’t reach any agreement. To put it bluntly, there is no Republican way to replace ObamaCare with some other federal program. The free market is the answer.

There are several ways to make medical care less expensive. Apart from those in our earlier post, which still make sense, the government could also make health insurance more affordable by allowing an income tax credit — not a mere deduction, but a dollar-for-dollar credit — for health insurance premiums. Also, health insurance could be made more affordable by eliminating federal requirement that such insurance should cover pre-existing conditions. That’s not insurance, it’s welfare, and insurance companies shouldn’t be forced to provide it. States already have programs that deal with the medical needs of those who can’t afford it.

Trump’s failure is because his proposal wasn’t sufficiently Republican. He asked his party in Congress to create a national program that would somehow be better than the mess created by Democrats. That is absurd. Instead of “repeal and replace,” the Republicans should have worked on repeal and reform. There are plenty of ways to reduce medical costs — but constructing a gigantic national program isn’t one of them.

Copyright © 2017. The Sensuous Curmudgeon. All rights reserved.

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36 responses to “Trump & ObamaCare — What Went Wrong

  1. Yeah, I’ll I’ll bite. Of course, pre-existing conditions need to be covered for insurance purposes. Otherwise, millions of people would not be able to be covered, would simply die, or never ever be able to get insurance.

  2. Derek Freyberg

    Forget *bleep* health “insurance”, which only fattens the pocketbooks of intermediaries (at least as health insurance is practiced in the US). Create a true national health coverage system such as the rest of the first world has, whether single payer (Canada), combined (UK NHS with the option to buy other coverage, or several other countries), through insurance companies (Taiwan, Switzerland), or whatever. But cover everyone, and stop pissing and moaning about it. We spend far more money per person on healthcare than any other country in the world by far, and yet have significantly poorer outcomes than many that provide full coverage for a lot less. The less preventive treatment, and the less early intervention treatment, that people get, the more their treatment costs later (for example, pennies for statins against tens of thousands to treat a heart attack) – and if they’re unable to pay, as all so many are, those costs are ultimately borne by all of us.
    ObamaCare is NOT a failure – if it fails now, it will be because the Rethuglicans distort its provisions enough to make it fail. Sure it could be improved, and in my opinion true national health coverage is the best improvement.
    When the now-abandoned Rethuglican alternative would have moved 20+ million people off health coverage, it’s no wonder it failed to pass, and yet why did it fail to pass? – because it wasn’t yet cruel enough for the Freedom Caucus in cutting off care; and if it had been cruel enough for them, moderate Republicans would not have voted for it.
    There is no free market for health care: if I’m well, I don’t need it, and if I’m sick, I have to pay what the seller is asking because there is no alternative. Some form of national coverage that ensures everyone gets care when needed and bears a share of the cost is the only rational way.

  3. The problem with tax credits is that for low income people who don’t pay taxes, it does no good. If they are refundable, that helps, but people still have to come up with the payments for the year until they are able to submit their tax return.

    One reason insurance costs are going up is that young healthy people are on their parents’ company insurance plans until they are 26 years old and have no incentive to buy insurance in the exchange. The republicans were not going to touch that benefit. Changing that rule might actually help shore up some of the exchange plans, but it’s probably not politically attractive.

    Like Trump said, who knew it was so complicated?

  4. My unanswered question is, “Why must the health care industry be for-profit?” As for-profit enterprises, their first and really only obligation is to shareholders.

  5. The free market has failed in so many areas. Profit cannot show empathy. I hope you have a pre-existing condition, Curmudgeon. And I hope you know what it’s like to be denied insurance because of it. Have you? Of course not. It’s all textbook for you and you seem to have no idea how people outside of your basement live.

  6. SC claimed: “First, the “repeal” part of Trump’s plan makes sense — at least to us — because ObamaCare is a failure.”
    On what do you base this false assertion? Millions of people who prior to the ACA have signed up for it and are reaping its many benefits. I hardly call that a failure, SC. You’re swinging the right-wing mantra that it’s a failure, that it’s collapsing, etc., but that’s all hogwash. BTW, the originator of the myth of the ACA collapsing was uttered by an insurance CEO (Aetna?) who was wanting to merge with another private insurer (Humana?) and the merger was rejected by the government. He was really pissed and pulled out of the ACA and then uttered his now misquoted phrase that the “ACA was collapsing” and either he or the right wingers added the old death spiral words to boot. It’s really tiring to hear this right-wing conservative crap that the ACA is failing. But there are forces at work desiring to make it so, like Trump (pulled ACA signup commercials), Congress/Trump will do what they can to defund it, republican governors who’d rather let their people die for lack of insurance than accept the ACA and Medicaid expansion.
    Failure? Not by any means. But to replace the ACA with the B.S. that republicans put forth was absurd. Bigger, better, cheaper, everybody covered, all Trump/Ryan/republican lies one after another.

  7. I make 15000 a year. I don’t pay any income taxes. how is a stupid creidit going to help me.

  8. Here’s my suggestion for a health care law. No legislator may have health insurance that is better than the worst program available to any of his constituents. It’s even shorter and easier to understand than the failed Trumpcare proposal. You can call it abecare, if you like.

  9. Canada has vastly lower retail costs for medication. Whatever they’re doing, we need to do.

  10. Michael Fugate

    1) it needs to be off employers shoulders to offer healthcare to employees
    2) it should not be in the hands of for-profit companies
    3) like education, we should be trusting doctors not administrators to determine what is best

  11. The best way to keep health cost down is to follow good diet, exercise, & most importantly before birth pick grandparents with very good genes! ;-}

  12. My response is simple: would you want the military to be put on a free market basis? (I have not yet found anyone who says yes.) So, if you don’t want to put killing people into a market, why would you want to put healing people one?

  13. abeastwood, as usual, has a great idea. Every US citizen should have the same heath care as Congress.

    How do we pay for it?
    1) Don’t build the #%$##@ wall — $25 billion
    2) Don’t increase military spending — $54 billion
    3) Federal tax on tobacco, earmarked for health care — $??? billion (After all, smokers drive up the cost of health care — this way they pay their way, and then some.)
    4) Increase federal tax on alcohol — $??? billion (Same reasoning.)
    5) Legalize pot; tax heavily — $??? billion
    6) Fed tax on soft drinks — $??? billion
    7) Remove the upper limit on Social Security tax so that ALL taxpayers pay the same percentage; earmark the additional collection for health care.

    Sure, it’s socialized medicine. So what? The benefit would be an overall healthier population and thus, more productive. We have socialized highways, right? (They’re not all tollroads.) No one complains about that.

    Any more ideas for revenue enhancement?

  14. Charles Deetz ;)

    Well, it was an absolutely amazing thing to watch. Train wrecks always are, especially when its engineers are dumb and heartless. They seemed to think they don’t need tracks … just let the free market of possible tracks fill the need.

    Amazing the spin of ‘everyone could buy insurance’, as if that’s a feature. And that block grants sound market-friendly, except when they are poison pills.

    And absolutely f-n amazing that Trump acts so valiantly to protect tens of Americans from evil immigrants, and doesn’t give a flying f about thousands who will die and suffer without healthcare. And the hypocrisy of wanting to grow the economy, when, without security of our health, that is simply not possible.

    Is the ACA an ugly compromise? Yep. Are there better alternatives. Yep. But those alternatives are more socialist. The more people forced to have insurance, the less it costs for everyone … but no one has the nerve to do that, at least ACA tried. Unfortunately, the republicans ran the train the other direction and screwed up royally. I’m glad, it proved the point they didn’t get until now. Amazing to hear Ryan say that ‘Obamacare is the law of the land for the foreseeable future.’

  15. The problem with limiting insurance for pre-existing conditions, is that “pre-existing” can be redefined at any time for the insurance company’s benefit. With genetic testing, more tests and scans, electronic records, at some point just about everyone will have a pre-existing condition.

  16. Dave Luckett

    I live in a country where basic health and medical care is funded by a one-payer tax-funded program. The tax is separately collected as a surcharge to income tax. For non-urgent and elective treatments, and to get care by the physician of choice, there is additional insurance privately available. Since the heavy lifting is being done by the national scheme, this is affordable, within reason. There is usually a fee to pay for visiting a doctor, because what the government pays is less than what most of them actually charge, but a normal medical consult costs about forty dollars, net, to the patient. Further concessions are made to those on some form of welfare. Most doctors will do standard medical consults at the government rate, if the patient really can’t pay.

    Prescription pharmaceuticals are subsidized, the more expensive and essential ones heavily so, but the same scheme is subject to negotiation of basic price with pharmaceutical manufacturers. Economies of scale and one-payer buying power have resulted in huge benefits.

    Our market is tiny compared to that of the United States. I have no idea why Americans think that single customers, often sick, can negotiate with insurance companies whose profits depend on NOT paying out. But then I can’t fathom a great many things about why Americans think as they do.

  17. Ceteris Paribus

    It’s really very simple to arrange health care benefits based on congressional districts, as mentioned above. All of the wealthy districts would be able to provide their own free-market coverage. The poor districts would get access to the 20% of US hospitals which are now owned by the Catholic Church.
    The individual states have already figured out how to Gerrymander their legislative districts to insure that the Republicans will always provide more more representation in Congress than the Democrats. So even when on the national level there are actually more Democratic Party votes than Republican Party votes, this is a slam-dunk no-brainer. solution to health care.

  18. Compare the US with the UK (I have lived and worked in both) or any other advanced nation. The US pays twice as much relative to GDP and gets no more, by some measures, a great deal less, in return.

    My physician in Texas had two full-time employees whose job was filing, and negotiating, with insurance companies. The insurance companies in turn must have had a comparable number of employees responding, and all of this must be reflected somewhere in the bills. And while private funding of health care does reduce taxes, that is only because we ignore the effect of health insurance premiums, which function, as far as individuals are concerned, just like a tax.

  19. Dr. Braterman writes

    Compare the US with the UK (I have lived and worked in both) or any other advanced nation.

    Same here: grew up in USA, lived ever since in the UK, and if there’s one thing that experience tells me, it is that there are two topics that just can’t be translated across the Atlantic: the first is guns, the second is healthcare.

    Do you recall, eight years ago, when Sarah Palin was describing the fearsome ‘Death Panels’ of the NHS? Plenty of Americans still believe her pioneering Fake News and Alternative Facts about the perils of ‘socialised medicine.’

    But I don’t see how European solutions on healthcare could ever be made to work in the US in the absence of the kind of social consensus which arose over here (and largely through the traumatising experince of WWII). Imagine if the Atlee government had had to administer National Insurance through the private insurance sector–which is approximately what the ACA is in some degree attempting to do. Hard to see that ever working out terribly well, though there is a case to be made (but not by me, I’m not expert) that it’s an improvement over the status quo ante.

    As Charles Deetz points out above, the Trump administration’s first attempt to ameliorate matters was a colossal train wreck–but the two most worrying aspects of that IMHO are: (1) the split within the GOP (with one wing wanting to remove government from healthcare altogether) means they are unlikely to come up with any sort of alternative at all, and (2) their current spin of ‘Obamacare will implode–and it’s all the Democrats fault’ is utterly pathetic. But then, after 8 years of knee-jerk opposition and crazy conspiracy theorising, it seems all they are fit for is scapegoating others rather than undertaking the hard and compromising work of governing.

  20. Paul Braterman says: “Compare the US with the UK (I have lived and worked in both) or any other advanced nation. The US pays twice as much relative to GDP and gets no more, by some measures, a great deal less, in return.”

    Yes, and it wasn’t always like that. Part of the problem, as I’ve mentioned before, is the unfortunate necessity of doctors to practice Defensive medicine to avoid spurious malpractice claims. That can be remedied by tort reform legislation, as I discussed in my earlier post.

    As you mentioned, every doctor’s office has clerical personnel whose job isn’t medicine, but dealing with insurance matters, medicare requirements, etc. Also built into the costs are the personnel of insurance companies and government personnel who provide no medical services whatsoever. All of that is relatively new, the result of well-intentioned but misguided legislation, and it can be significantly ameliorated by reforms. But the reform effort must reduce, not enhance governmental presence in the practice of medicine.

  21. Our Curmudgeon notes:

    Also built into the costs are the personnel of insurance companies and government personnel who provide no medical services whatsoever. … [snip] … But the reform effort must reduce, not enhance governmental presence in the practice of medicine.

    To preserve the parallel structure of your logic here, that last part should read “reform effort must reduce, not enhance, governmental and insurance company presence in the practice of medicine.”

    But that won’t happen over there.

  22. Michael Fugate

    Why is governmental influence any worse than insurance company influence?

  23. “But the reform effort must reduce, not enhance governmental presence”
    Like happened in The Netherlands about 10 years ago, you mean? That reduce enhanced the presence of insurance companies, resulting in more bureaucracy (within those companies) than ever, resulting in increased costs.
    But rather will Klinkleclapper begin to worship Darwin than our dear SC stop worshipping Adam Smith’ Invisible Hand.

  24. My silver HMO costs me almost $500/month in the free market. The same coverage with Obamacare’s tax credits costs about half that. Which one gives me more freedom?

    If you deny my coverage because of pre-existing condition do I have more or less freedom?

  25. One advantage of providing universal health care funded by taxes is that it would remove the burden of paying for health insurance from businesses, making the cost of goods made in the U.S. more competitive. Individual tax rates would go up, however the employee cost share for company insurance is typically fairly high, so it would probably be a savings for individuals.

    One aspect of company provided insurance is that the cost for a given company-provided insurance option is the same regardless of an employee’s salary. So it disproportionately reduces the take-home income for low level employees, or in many cases results in employees opting for less insurance than they need. Taxes are, on the other hand, proportional to income, which resolves this issue. More cash in the pockets of lower income people is more cash spent in the economy.

    Perhaps insurance companies could offer policies providing increased benefits (private hospital room, lower drug costs?) that companies could use as benefits to attract key employees, or individuals who could afford them could take advantage of, so there would continue to be an insurance market. In this case, since private insurance would not be required to access basic medical care, private insurance would actually constitute a free market in which consumers could participate if they chose to.

  26. When I cook I have a choice. I can select the ingredients, follow a recipe, keep an eye on things and produce a very nice meal.

    Or, I can throw a bunch of random stuff into a pot, turn on the heat, walk away for an indefinite period and hope for the best.

    Same thing happened here.

    Obama studied healthcare reform then pulled together over 100 subject experts who spent 14 months crafting legislation. Republicans were invited to participate but Eric Cantor (remember him?) and especially Mitch McConnell made it clear that they didn’t want the taint of “bipartisanship” to signal to the American people that the bill was OK. The Republicans had one weapon, the Party of No, and they used it relentlessly.

    Nevertheless, by drawing on Romneycare and Republican healthcare reform ideas, the ACA was born.

    So, hundreds of people, months of work, compromise, etc. and that’s the ACA.

    Fast forward to 2017. Small number of people, working in a locked room in a basement for 18 days produce a Ryanstein monster, which, one day before the scheduled vote, undergoes further amputations and disembowelments, until it is a gasping pile of unrecognizable parts. This is served to a guy we’ll call the Bigly in Chief, who has no understanding of healthcare, no understanding of government, no understanding of how a bill is created or passed, no understanding that the folks in Congress don’t work for him and that he can’t fire them, and who has to be told (because he can’t figure it out for himself) that the dingo ait his baby.

    But, wait! It gets better and better! Old Wormtongue Bannon has advised Bigly to create a “disloyality list” of those Congress critters who wouldn’t support the monster. Oh, boy, I can’t wait to see how wonderfully that’s going to work out. I bet it will make my head spin! Bigly.

  27. You don’t have to cross the Atlantic to see a functional national health care system – just look at Canada. I lived in the US for the first fifty years of my life and saw the failings of medical support there. In 1982 I moved to Canada and have been the beneficiary of the system here on several occasions. My wife and I both ran up what would be HUGE costs in the US. Here the annual insurance premium is reasonable and is tied to one’s income. When I describe Canadian medical coverage I say that it’s as technically advanced as it is anywhere and, most important, I can afford it!

  28. Michael Fugate – “Why is governmental influence any worse than insurance company influence?” – Because many Americans still confuse the structure and power of large corporations with the entrepreneurial, free-market competition that used to be provided by small and medium sized businesses. It’s a semantic problem, where the same old words are being used to describe a different thing.

  29. Ceteris Paribus

    Ken Phelps – It is not a semantic problem, and you haven’t advanced the question made by Michael Fugate.
    In a market system, large and small corporations take bids for their health benefits packages. In the the free market, this means that the insurance companies bid lower insurance premiums when the employers have a personnel department that carefully screens out new hires that are getting elderly, have pre-existing conditions, or for example are women of child bearing age.
    New business startups, such as by emerging entrepreneurs splitting off into new markets will not have a wide enough employee population to even get into the health care bidding process
    So the only way for the truly competitive free market that you wish to see, is for a central government to operate a universal health care system.

  30. Personally I can’t understand how a so called 1st world country doesn’t accept that health care is a right of all it’s citizens.

  31. Ceteris Paribus

    Guy — Um, I think maybe we could understand it just fine if we look at it thru the eyes of any privileged white male Anglo-Saxon, who even though well educated, rational, and sincere, had only the same access to leeches, poultices, and folk medicines which had served the entire history the planet until just the middle of the 19th century. It will take a while for those of privelege today to get the message.

  32. Ceteris – You missed the point entirely. Government involvement is a problem for many conservatives because they respond to words like “government” and “free market” with emotional caricatures that bear little relationship to current reality.

  33. Dave Luckett

    The introduction of one-payer, tax-funded health care would be like the abolition of capital punishment. I lived through both. Ten years after it came in, only a tiny fringe of extreme loons would want things back the way they were.

  34. The fundamental problem was that Republicans were so fixated on repealing the work of that Kenyan-born Communist secret Muslim in the White House, where Sarah Palin should have lived after President John McCain dropped dead of a heart attack in 2009, that they forgot to put together a coherent replacement first.

  35. Eric – you forgot black.

  36. Eric Lipps suggests the GOP

    forgot to put together a coherent replacement first

    Actually, I thought the issue was that parts of the GOP don’t agree that there should be a replacement at all, only repeal of ACA (and ideally, Medicare and Medicaid as well) on the grounds that government should have no involvement in health care whatsoever. There’s no provision in the all-hallowed Constitution for that, or for government involvement in education, &c &c

    That’s not an argument I’m making, btw, but some do make it.