You only get one chance to pass legislation. If you miss it, there will never be another opportunity.
That’s what some are implying about the American Health Care Act (AHCA) which was pulled from consideration in the House of Representatives when it didn’t quite have enough support to pass. This badly needed reform of Obamacare is now impossible, they say.
Seriously? Don’t they know that reform legislation sometimes takes more than one try? Welfare reform in the late 1990s took three tries. The new law was worth the extra effort — it succeeded in helping millions of Americans transition from welfare to work.
Just as it did then, Congress needs to give reform a second chance. We’re all painfully aware of just how much Obamacare does not work.
In the first few years, millions of Americans lost their insurance and had to scramble to find replacement policies which often had higher deductibles and premiums. Premium costs continue to rise. Government mandates and abuse of guaranteed issue provisions have forced insurance companies to leave Obamacare exchanges. Now one third of US counties have but one insurance option under Obamacare.
In the future, Americans will likely face higher costs and even fewer options.
Americans need Congress to pass a bill that reforms Obamacare. During the first try, ACHA contained several promising reforms. It dismantled some of the mandates and taxes, expanded Health Savings Accounts (HSAs) so families can better save for medical expenses, and reformed Medicaid. Because of arcane rules in the Senate, the bill could not contain all of the reform ideas. Nevertheless, the bill represented an improvement over current law.
ACHA 2.0 can be even better. In drafting an improved bill, three principles should guide reforms:
1. Fewer government mandates on benefits will result in more insurance policy choices and more affordable choices. Imagine how expensive car insurance would be if the government required all policies to cover routine maintenance like oil chances and wear and tear repairs. Car insurance premiums would sky rocket and customers would have fewer choices on coverage. Similarly, government should not require Americans to purchase coverage they don’t need or want.
2. Americans should not be able to game the system. Because of guaranteed issue (meaning insurance cannot consider pre-existing conditions), more Americans have access to insurance in the individual market. However, some Americans game the system by getting insurance only when they need to cover a procedure. These freeloaders are forcing everyone who faithfully pays premiums to pick up their costs. The ACHA, as written, only places a slight penalty on those who game the system. Congress needs to remove guarantee issue from those who do not maintain continuous coverage.
3. Move more Americans from dependency and entitlement to self sufficiency. The ACHA Medicaid reforms should go farther to ensure that able bodied adults transition from government insurance to private insurance. Some individuals will choose not to buy insurance because they have other priorities. Taxpayers should not have to cover their choices. That’s not fair. Likewise, Congress should assess the subsidies (in the form of tax credits) as these could cause insurance prices to rise. Companies have little incentive to keep prices affordable when a third party is contributing.
What are your thoughts?
Are we better off with the broken, expensive, restrictive mandates of Obamacare, or more choices and innovation in health care?
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