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Conservatives Must Take Back Healthcare Debate

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There are plenty of ideas for undoing this damage and building a more affordable, innovative health sector.

U.S. House Republicans are launching a task force aimed at drawing out new ideas for healthcare reform.

The task force “will convene members from various committees as well as independent experts and stakeholders from across the health care sector to reform what’s broken and build on what’s working,” per Reps. Jodey Arrington, R-Texas, and Dr. Michael C. Burgess, R-Texas, two of its organizers.

Dr. Burgess will serve as chairman of the task force.

Both congressman are concerned with the amount of money America spends on healthcare.

They cogently note, “Nearly one third of the total $6.4 trillion in federal government spending this year will be on healthcare, which is projected to grow from $1.9 trillion to over $3.4 trillion by 2033.”

The task before Republicans is to craft policies that reduce the government’s healthcare bill while continuing to provide Americans with ready access to affordable, high-quality medical care. This is a challenge the GOP’s market-based approach to reform is uniquely equipped to meet.

One of the main reasons the government spends so much on health care is that Obamacare has driven up the price of coverage.

Democrats have responded by enacting increasingly generous taxpayer-funded subsidies to offset these higher prices.

This fiscal year, Obamacare’s premium subsidies will run taxpayers $91 billion.

Between 2024 and 2033, the tab for those subsidies will eclipse $1.04 trillion, according to research from the Paragon Institute’s Brian Blase.

The subsidies only fuel healthcare inflation. Instead, policymakers should consider rolling back the regulations that have caused costs to surge.

By forbidding insurers from pricing policies according to the risks posed by individual policyholders, Obamacare ensured that overall premiums would rise.

The law’s essential health benefits provision, which requires all health plans to cover the same list of 10 benefits regardless of what patients need or want, drives up costs further.

Rolling back these restrictions would empower insurers to offer a wider variety of less expensive coverage options while introducing the kinds of market forces that can drive down costs and improve quality.

Republicans have made inroads in this direction by attempting to expand access to short-term, limited-duration plans, which are exempt from Obamacare’s regulations and thus tend to be more affordable.

President Trump issued an executive order in 2018 that extended the maximum length of a short-term plan from 3 months to 364 days.

The order also allowed insurers to renew short-term plans for up to three years.

These changes made them a more practical substitute for exchange coverage.

The Biden administration is set to undo this executive order — and thereby deprive Americans of one of the few low-cost insurance options on the market.

Republicans can differentiate themselves as the party committed to lowering insurance costs by standing up for short-term plans in the run-up to next fall’s election.

Enabling more Americans to save money in Health Savings Accounts would introduce yet more dynamism into the health sector. HSAs are triple tax-advantaged — money is tax-free going in, grows-tax free, and is tax-free going out, as long as it’s spent on health care.

By encouraging Americans to shop around for care and rewarding providers for offering their services at a competitive price, HSAs can put downward pressure on overall healthcare spending without compromising quality.

A study published in the journal Health Services Research found that patients with HSAs “spent roughly 5-7% less when compared with traditional health plan enrollees.”

Currently, only people with high-deductible health plans may contribute to HSAs. And the maximum amount an individual can set aside is $3,850. For a family, that maximum is $7,750.

Republicans should make anyone, including those on Medicare, eligible to contribute to an HSA — and to save much more than the current limits.

The guiding principle that runs through reforms like these is that individuals are better at spending their healthcare dollars than the government.

Consider the massive amounts of fraudulent or wasteful spending in Medicare and Medicaid. Last year, improper payments across the two programs exceeded $127 billion.

That level of waste is unacceptable — especially given the potential benefits of oversight. A recent paper by the University of Chicago economist Maggie Shi found that, for every dollar Medicare spent monitoring for unnecessary spending, it could save anywhere from $24 to $29.

For decades, Democrats have advanced a regulate-and-subsidize healthcare agenda leading to unsustainably high costs and dwindling patient choice.

There are plenty of ideas for undoing this damage and building a more affordable, innovative health sector.

Hopefully the new Republican task force will adopt them.

 

Read the full article at Newsmax

 

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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