How Obamacare Should Be Fixed

The Affordable Care Act (aka:Obamacare), despite its controversial aspects expressed by opponents of the ACA on both sides of the ideological aisle, should not be repealed and replaced as many conservatives would like to do (but as of yet have failed to accomplish) nor should our country adopt the progressive (read: far left) idea of “Medicare For All”(or more accurately, single payer healthcare).

For all of its faults, Obamacare was a step in the right direction for the generational conundrum over healthcare in the United States, as the conservative and liberal/progressive healthcare solutions are neither sustainable or realistic.

When Obamacare was passed and signed into law on 23 March 2010, the chief conservative and libertarian complaint about the law was its individual mandate requiring Americans to buy insurance on state exchanges (with subsidies for lower income Americans), show adequate coverage through an employer, have coverage under Medicaid or Medicare, or pay a tax penalty for not having any coverage. Americans typically take exception to being forced to buy a product or service that enriches private enterprise, unless compliance serves some perceived individual self-interest.

Americans being forced to buy insurance is hardly without precedent. If you want to legally operate a car on public roads, you have to either buy full coverage insurance (if the car still has a bank lien), carry liability insurance, or (in some states like New Hampshire) you have to put up a rather large cash bond with the state.

Liberal/progressives criticize Obamacare chiefly because there was no public option (government-funded insurance like Medicare/Medicaid). Including such an option, according to conservatives, would lead to most Americans opting for the public option, and thus, eventually to de facto single payer healthcare.

I posit that both the conservative and liberal/progressive critiques of Obamacare miss the mark…

If anything, Obamacare’s individual mandate didn’t have enough teeth to make the law work as intended.

Paying a relatively small tax penalty is hardly penalty enough to encourage the healthy to buy insurance.

The for-profit healthcare insurance industry relies on the pool of healthy and/or young insureds to be larger (and paying in) than the unhealthy and/or older pool of insureds to whom the insurance companies are paying out billions to cover their healthcare expenses. This is similar to car insurance companies relying on a larger pool of safe drivers to cover the risky drivers. The risky drivers, incidentally, pay more in premiums than the safe drivers.

If the Democrats running for president in 2020 are paying attention, rather than promising to modify the ACA to include a public option or scrapping the ACA for Medicare for All, they would do well to give Americans another choice, one that preserves the American spirit of independence (more on this “mythical thinking” in a future post)…

Presidential candidates should instead tout the “choice”of buying insurance on the exchange or paying into a healthcare savings account (HSA) with a minimum balance of $50,000 for individuals or $100,000 minimum for a family.

Those who can afford the HSA minimum balance today will have that option immediately available to them and those that will one day be able to establish an HSA can opt for that choice if wealthy enough, healthy enough, and young enough.

The for-profit system of healthcare insurance cannot endure when people who feel they will never need it because they are young and healthy are not paying in. Not if the ACA still requires insurance companies to cover those with preexisting conditions.

Like risky drivers have to pay more in car insurance premiums, those with preexisting conditions should pay a little more and the healthy, including older Americans who take better care of their health, should receive discounts. This kind of model makes sense and shifts the burden of paying for healthcare back where it belongs…

On the individual.

-The Rational Ram

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