Establishment Republicans remain clueless about health care. Time for Trump to act
Man with an "oh crap" moment.

Establishment Republicans remain clueless about health care

Posted March 05, 2017 06:00 AM by Daniel Horowitz Man with an "oh crap" moment.
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"As the heavens are higher than the earth, so are My ways higher than your ways and My thoughts [higher] than your thoughts.” ~ Isaiah, 55:9

The entire premise of GOP lobbyist-driven negotiations over Obamacare are about as divorced from the reality of free markets as our thoughts are from the thoughts of God. As Politico reports today, Republicans continue to accept the entire premise of the RINO-care framework, and are merely negotiating the fine print. They are insufferable. 

There is no talk of lowering prices, fostering a revolution of choice, competition, portability, cost-consciousness, or breaking down the barriers between consumers and providers. Had deregulation of airlines been left up to the GOP, we would never have had the revolution of Southwest Airlines. We would never have had Uber, Amazon, Netflix, Apple, or Walmart either.

The enduring lesson of Obamacare is that by pursuing universal coverage at the expense of lower costs and creating competition, we achieve neither goal. 

The entire premise and framework of GOP negotiations is working within the confines of the failed intellectual ghetto of the status quo, which is the retention of the entire market-crippling regulatory regime. Rather than breaking down the regulatory and subsidy state — which is solely responsible for making health care miss the 21st century and operate like a hotel room mini bar rather than Walmart — Republicans are working with lobbyists to double down on it.

As such, Republicans have played follow-the-leader with Democrats in focusing exclusively — and in a vacuum — on coverage numbers of comatose insurance in a zombie 19th century health care system (actually it worked better back then relative to technology). It’s all about salvaging the status quo with some tweaks under the guise of helping the poor and the chronically ill rather than tearing down the entire leviathan in order to spawn an across-the-board revolution to bring down prices. The enduring lesson of Obamacare is that by pursuing universal coverage at the expense of lower costs and creating competition, we achieve neither goal. Conversely, by creating a full free market (or as close to one as practicably possible), we will benefit 90 percent of the country, while isolating and minimizing the problems of the chronically ill so that it is cheaper and more manageable to get them adequate coverage in a revitalized insurance market.

What is now taking place behind closed doors with Big Pharma lobbyists and the parasites at the American Medical Association is the equivalent of politicians getting into a room with the Postal Service lobbyists and plotting a regulatory climate to box out FedEx, keeping American consumers reliant on a failed system.

In reality, Americans want the opposite. There have been a lot of phony polls published on this issue, as most issue-based polling is highly subjective and arbitrary. But Black Book Market Research did a comprehensive survey of 34,800 actual Obamacare enrollees with very specific questions, not just abstract principles. Their results should awaken every Republican who is obsessed with polls instead of doing the right thing: 

  • Only 22 percent rated their plans as good or excellent.
  • 96 percent of enrollees report a decline in customer service (I can personally attest to that! They double charged me and their customer service line has become like a government-run agency. There is no need or desire to please consumers because there is no real market left.)
  • 90 percent reported premium increases and 77 percent reported curtailed benefits.
  • 80 percent reported narrowing provider networks or excluding their former providers.
  • 61 percent complained about the lack of competitors.

Nothing in American politics is going to be 100 percent, especially in this polarized country. But you will never get more favorable numbers on any other issue. Yes, there will always be a vocal minority that wants free stuff under any and all failing circumstances. But most people just want choices, competitions, and lower costs. In other words, they want a real market. And with the advent of the internet, this is true now more than ever before. Yet, nobody in the political class has painted a picture of this for them so we can all strive for something greater than the false choices with which they present us. 

The internet breaks down the barriers of knowledge between the consumer and provider like we have never seen in history. If we would only get rid of the government-run leviathan of regulations and subsidies that forces insurers to placate government and lobbyists rather than compete solely for consumer business, we could restore and grow such a market.

It's time for Trump to step up to the plate

As I said on my last podcast, President Trump needs to give a landmark speech laying out a vision of free market health care. As a populist with the persona of “America’s entrepreneur,” he is the perfect messenger to rail against the Big Government/Big Pharma cartel working to stifle innovation and competition in the hopes of preserving the troughs for more subsidies. Trump needs to ask the American people and Congress if they want a health care system that looks more like Walmart and Uber or one that looks like the Post Office, the DMV, and a mini bar in your hotel room.

Trump must call all the CEOs of health insurance companies into his office and tell them loudly and clearly: “we will not regulate you, but we will not subsidize you either. The era of government-run health care is over. Go out and compete for business.” He should also promise them that once full repeal is signed, he will promote cross-state line insurance, equal taxation for the individual market, and repeal of even pre-Obamacare interventions and regulations. This will ensure a healthy and robust individual market that is worth competing in.  

To that end, Trump should demand from congressional leaders the following:

  • The immediate repeal of Obamacare’s taxes and the regulations by mid-year so that insurance companies can have certainty to offer cheaper, competitive plans in 2018. Repeal the entire structure of the exchanges for at least 2019, and allow insurers to offer any plan at any time for any purpose.
  • An 18-month transition for retaining the subsidies and the Medicaid expansion. However, immediately freeze both programs from new registrations.
  • On the administrative end, have Health and Human Services Secretary Tom Price get rid of any cost-sharing subsidies and risk corridor bailouts for insurance companies. This will force insurers to utilize the lifting of regulations to lower prices and actually compete for business rather than relying on subsidies.
  • Meanwhile, individual states should work on reducing their own onerous health care and health insurance regulations in order to maximize the market effect of reducing federal insurance regulations. Rather than having John Kasich shill at the Republican Governor’s Association for more Medicaid subsidies, how about using the 33 Republican state legislatures to tear down the onerous [AMA-driven] regulations on insurance and the supply side of healthcare?
  • Place the cross-state line provision in budget reconciliation. This is a consensus idea. Try to get a positive score from CBO showing how cross-state line insurance will decrease prices and thereby engender less of a need for government subsidies.

 

Undoubtedly, between Medicare, the VA, and existing Medicaid structure, there is still much to do to restore the free market. And those programs clearly distort the rest of the market. But enacting the aforementioned reforms will go a long way in restoring an adequate market for the majority of Americans who don’t need or want subsidized poor quality health care at a higher cost.

Yes, Americans have a right to health care … free market health care. They have the right to pursue happiness unencumbered by government-lobbyist efforts to leave health care behind the great technological revolution.

Editor's Note: This piece was updated for clarity.

Daniel Horowitz is a senior editor of Conservative Review. Follow him on Twitter @RMConservative.