Health Care: Repair or Repeal and Replace?

Health Care:  Repair or Repeal and Replace?

As is the policy with my blog posts, I seek to share a “third alternative” to the partisan proposals on key issues that come from the political parties.  I try to employ the ideology of “what works” versus either political or partisan ideology.

So within this context, today I would like to provide a suggestion on the specific issue of a new Health Care Law.  The Republicans have just proposed the first part of their “Repeal and Replace” approach to the existing Affordable Care Act.  And I expect that the Democrats will take up opposition to these changes, and by default, will defend the status quo of the Affordable Care Act, without defining what changes they would make to address the key problems that have surfaced with the existing law.

This approach is how the parties responded to the Affordable Care Act over the past 8 years, in reversed roles.   The Republicans opposed the passing of the Affordable Care Act, but provided no alternative approach.  This approach did not serve the public interest then and will not serve the public interest now.  So the attempt of this blog entry to suggest an alternative solution that might serve the public interest by providing an alternative worth consideration.

At the start, I have sought to understand and define the problems that exist with the current ACA law that were not anticipated, so that I could propose the changes to the current ACA law that would effectively address these problems.  Providing a real Repair alternative to the Repeal and Replace approach of the Republican Administration will hopefully help focus the debate on issues of importance to the public interest, versus partisan interests.

Here are the key elements of the proposed Repair to the ACA:

1.  Eliminate the limited number of proscribed benefit policies, which while with good intentions were designed to ensure that all policies provided basic care, had the unintended outcome of reducing choice of Americans for a policy that would meet their personal needs.  These plans would be replaced with a menu-based process for “building” a personalized health care policy.  The benefits of the different coverage options would be explained, and a suggestion of the coverages that would best meet the needs of people in different risk or demographic profiles would be provided.  However, the choice of specific options would be left to the individual. 

Each policy should start with a base policy that would only cover emergency care and transportation in the event of a severe accident, injury or illness … the very kind of services that would be provided for free at taxpayer’s expense for uninsured patients.  Every American should have this coverage, with support in the areas of tax credits or subsidies if needed depending on income. This would ensure that no one would come to an emergency room for emergency care without a base level of insurance.  And a policy for all Americans covering only this service should be very low in cost.

This approach is consistent with the principal that people should take responsibility for their own health care insurance and that no one should expect the government to pay for their emergency care if they can afford it.  But neither do we want as a society to check for proof of insurance at accident sites or in emergencies before care is provided.

2.  Eliminate the requirement for businesses to provide health care for employees.  In fact, I propose to change the law to eliminate ALL employee provided health care programs, and require that ALL Americans obtain their own health care insurance plan from a national pool.  Each individual should own the health care plan, not the employer.  This would eliminate a lot of the pre-existing condition needs that arise when an employee leaves a company health plan and needs to purchase private insurance.  Everyone should own their own health care plan and have the opportunity to choose the coverages they need from a menu-based plan process.

This should appeal to Americans as fair, especially to small business owners and employees.  The current system allows large companies to negotiate health care services with insurance companies on the basis of their employee pool, not a national or regional pool.  Further, there is a tax benefit to employees and employers, as neither pays tax on the costs of health care plans provided to employees.  So as a small business owner, I and my employees will pay higher health care costs than our neighbors who work for Fortune 500 companies, and this puts small businesses at a disadvantage in attracting talent.

The new Republican Health Care Plan would provide a tax credit to “equalize” this benefit between large and small businesses, but both of these policy elements reduce the income to the government, and thus have a deficit impact.  The proposal of eliminating business owned and provided health care, and replacing this with only individual health care plans, equalizes the playing field without a major deficit impact.   This change is important because small businesses are the major job creators in this country and should not be at a disadvantage to larger companies.  Let’s take health care benefits out of the employer’s package. 

Any company could provide a direct payment to the employee’s health care insurance they choose to help offset costs as a way of attracting and retaining employees, without the cost within the company of monitoring and negotiating health care coverages, reducing their current costs.  This represents a true “win-win” for companies large and small, and may reduce the costs for private insurance plans due to the expanded pools.

3.  Eliminate the state-by-state control over health insurance providers and enable every insurance company to cover citizens in every state.  This is being considered as part of a future Republican health care initiative, but could be part of an immediate repair to the ACA.  It is expected to be a key element of reducing the costs and ensuring broader choices in plan options to Americans in every state and situation.  The policy should require the states to continue their own oversight and to institute their own ratings systems for company performance, costs, patient satisfaction, and allow the states to levy fines for actions that violate the terms of their policies or for any actions that mislead or defraud consumers.

With these 3 changes to the ACA, I believe the major problems with the existing health care program would be repaired or completely eliminated.  Many of the concerns of both parties would be addressed, and the interests of the public would be the main focus of the policy.  This might well be an approach that both parties could work on together to implement with collaboration, instead of wasting time and money on a destructive debating process.

If you have comments or suggestions to this post, please do leave your comments below.  If you find it worthwhile, please do share the blog with others in your network.

Robert Viney