Right On: My simple, comprehensive Obamacare replacement

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OPINION – In the movie, “Lawrence of Arabia,” an aide asks British General Allenby what should be done as Arabs begin taking over Jerusalem’s city government. His classic reply: “Nothing. It’s usually best.”

Doing nothing would have been best for Republicans instead of last week’s Obamacare repeal and replace debacle. Speed kills.

If Republicans wanted to show some progress while working to build a consensus, they should have empaneled a blue ribbon commission followed by lengthy committee hearings and then forced Democrats to filibuster something, anything.

For four years House Republicans sent replacement bills to the Democratic Senate, knowing Harry Reid would ignore them. For the last two years, the Republican Congress passed replacement bills that they knew Obama would veto. For all six years, we heard that Republicans had a replacement plan ready to go. Did they ever read what they passed?

Democrats made a horrific mess with Obamacare, but as Nancy Pelosi famously said, “We’ll have to pass it to see what’s in it.” She recognizes what the Republican Freedom Caucus does not: Once any entitlement is in place, no matter how ill-conceived, eliminating it is very difficult, expanding it is much easier.

So what do I propose? Simple: get rid of all nine of the government’s existing health care programs, every one of them from Medicare to the Indian Health Service. Replace them with my simple, comprehensive plan.

I have been touting my Obamacare replacement for several years to any who would listen. I hoped to title it “Sierercare” until I discovered that Bloomberg columnist Megan McArdle has a very similar recommendation. Perhaps I’ll have to settle for “Sierer/McArdlecare.”

As we both suggest, my/her plan can be written on a postcard (OK, maybe a half dozen pages):

  • Federal government single-payer catastrophic coverage for everyone, regardless of age, for medical expenses that exceed 15 or 20 percent of a family’s adjusted gross income.
  • Expanded, voluntary tax-free Health Savings Accounts for medical expenses below the catastrophic coverage threshold.
  • Government contributions to Health Savings Accounts on a sliding scale for those below a specified income level.

That’s it. No one bankrupted by medical catastrophes, no one denied coverage for pre-existing conditions, no one forced to buy insurance coverage, no one forced to open an HSA.

Few object when our federal government steps in to help communities recover from natural disasters. Providing catastrophic coverage for family medical disasters follows the same principle: helping in situations that no one can reasonably anticipate or be expected to face alone.

Health Savings Accounts have a number of virtues. Most importantly, they belong to the individual but can only be spent on health care. Each person chooses when and how much to spend for routine care, knowing that he/she is backed up by catastrophic coverage if needed. Funds remaining at year-end can be rolled over indefinitely and the account is converted to an IRA when a designated retirement age is reached, a powerful motivator for thoughtful spending.

One of the great failings of today’s health care system is that a third party usually pays for services, either government or an insurance company. Neither doctors nor patients have incentives to control costs. The result can be unneeded office visits and doctors ordering too many “defensive” tests to protect themselves from lawsuits.

HSAs introduce market incentives: Individuals spend their own money for medical care, even if that money was first given to them by the government. Consumers can shop around for medical services and think twice about going to the emergency room for a common cold.

Individuals and families could purchase private health insurance using their HSA funds if they prefer coverage similar to today’s policies. Private insurance would cover expenses only up to the point where catastrophic coverage begins, reducing premiums.

Those with good health could build up HSA balances after several years that exceed the amount needed before catastrophic coverage begins; they would have little incentive for private insurance.

Progressives should be happy that everyone is covered and higher income folks pay more than the poor for their healthcare. Conservatives should be happy with a market-based health care system rather than a government-based one. Medical providers should be happy with time-of-service HSA payments and no claims to file unless the catastrophic limit is exceeded. Health insurers will be unhappy because fewer policies plus lower maximum liabilities equal lower premium income.

Some will argue that people won’t see a doctor if they have to pay for visits. Reporting their Oregon Experiment results in the prestigious New England Journal of Medicine, Harvard researchers concluded that even when medical care was provided at no cost, there were “no significant improvements in measured physical health outcomes.”

Why no improvement? The answer: visiting a doctor doesn’t make people healthy; following his/her advice is what “improves outcomes.” Too many people are overweight, get too little exercise, do not eat a balanced diet, smoke, or abuse alcohol and drugs, all of which are major contributors to poor health. Should the nanny state control all these personal choices to improve health outcomes?

Personal freedom requires personal responsibility. My plan offers everyone the means to exercise both.

Howard Sierer is an opinion columnist for St. George News. The opinions stated in this article are his own and may not be representative of St. George News.

Email: hsierer@stgeorgeutah.com

Twitter: @STGnews

Copyright St. George News, SaintGeorgeUtah.com LLC, 2017, all rights reserved.

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7 Comments

  • Brian March 30, 2017 at 9:07 am

    I love it! It’s a great plan.

    The closer the link between actions and consequences, the better. If your dog takes a dump in your living room, and 3 months later you whack with a rolled up newspaper, his behavior will never change. Humans are the same. If they can eat, drink, and be merry, knowing that some faceless stranger in another state will still pay for their viagra, 18 prescription medications, and many surgeries, what motive do they have to live healthy and take care of themselves? If someone else is paying most of their rent, healthcare, and food costs, what motive do they have to work harder? Expand their education? Try to create something? Be productive in the least?

    I endorse your plan.

  • comments March 30, 2017 at 1:02 pm

    Sounds fairly progressive, Howard. Many of the republicans would love a system where if you’re not able to pay for your own healthcare you’d simply be turned away and expected to go off somewhere and die. Get diagnosed with cancer, can’t pay the enormous costs? They’d say “your problem, not ours”, and you’d simply be turned away and denied any care. Howards idea seems very socialistic also– there’s that naughty word that “conservatives” hate: SOCIALISM.

  • Pheo March 30, 2017 at 1:21 pm

    “Progressives should be happy that everyone is covered and higher income folks pay more than the poor for their healthcare.”

    As a baby-eating liberal, I can confirm that this seems like a pretty good proposal. Credit where credit is due: Nicely done.

  • comments March 30, 2017 at 5:39 pm

    Fully containing the greed and wasteful spending in the US medical system would probably more than cut in half what is spent on care every year. It might cut it down to something like 1/4 of what’s currently spent. If you’ve ever been in a hospital and seen the exorbitant bill afterwards you know. Key words: waste, inefficiency, and greed. Too many politicians in the pocket of big pharma and the rest of the medical lobby. The big question: how can this be fixed?

  • ron84738 March 31, 2017 at 12:59 am

    Excellent article and well written. The only thing that was not mentioned is tort reform. The American Bar Association has been feeding off of the health care system forever. It’s time to put a stop to this racket, stop all the pandering TV ads begging people to call and “not worry, if you lose you don’t have to pay”. If you start litigation and you lose, then you and/or your attorney (if you are worthless”) should be required to pay ALL the legal fees and costs for both sides and be liable for punitive damages for the emotional and financial pain you and your attorney have caused!

  • dodgers March 31, 2017 at 5:30 am

    Lots on very good ideas within your plan. Lots to like and consider, including the simplicity.

    A few thoughts:

    Those who are unemployed and others without income would receive healthcare without cost. For some, that may provide less incentive to seek employment.

    Such plan would need to be limited to U.S. citizens.

    I’d like to know how the cost to our government would compare to current government spend.

  • commonsense March 31, 2017 at 3:51 pm

    I like it but those on Meicare have already prepaid premiums for coverage.

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