The post-policy GOP

"Post policy" - I chuckled when I read that in the Washington Post (here and here), in reference to the GOP.  Policy?  We don't need no stinking policy!  The GOP is playing whack-a-colleague with its latest nihilistic "Repeal Obamacare or we'll shut down the government!" tantrum.  The conservative Heritage Foundation, on whose writings Obamacare's mandate is based, is launching a $550K campaign to drum up support for letting insurance companies deny coverage to those with pre-existing conditions and making it more difficult for insurance policy-holders to shop around, among other perverse ideas.

Meanwhile enrollment for 2014 coverage starts in less than six weeks; in the spirit of good old American free enterprise, up to $1 billion in advertising will be spent by insurance companies alone to attract millions of new customers enabled by health reform.  That's nearly two thousand times the size of Heritage's campaign.

In fairness, the GOP does have some ideas worthy of consideration, if they would just stop with the "Repeal!" histrionics long enough to let them be heard.  They've argued for expanding the use of high deductible plans (I have one), allowing insurance companies to sell across state lines (they can today, to a limited extent; Obamacare allows states to expand it), and equalizing the tax treatment of employer-provided insurance versus individual insurance.  In my opinion, each of these has merit, although each has drawbacks.  I'd even entertain privatizing Medicaid and Medicare, as Paul Ryan has proposed; indeed Arkansas is experimenting with the former; and Medicare Advantage constitutes the latter.

Any of these ideas would fit nicely within the broad contours of Obamacare.  The GOP's problem is this: to use a golf analogy, they keep teeing off with a putter. Without Obamacare, none of their ideas address the three essential elements of health reform.

The first is eliminating consideration of pre-existing conditions.  Coverage is guaranteed.  When you enroll, all you need to provide is your name, address, birth date and social security number.  Maybe you have to disclose whether you smoke.  But that's it.  This isn't just about common decency, making sure those who really need coverage can get it; it's about making enrollment simple for everyone.  If enrollment involves nine hours reciting medical history, as it did with me, there is no way that Adam Smith's invisible hand can work its free market magic.  As for the premium, everyone pays the same amount, factoring in age, location, and perhaps whether you smoke.  In the insurance industry, this is called community rating.

The second element is that everyone, or at least almost everyone, has health insurance.   Insurance is all about sharing the risk of medical bills. The wider the community, or "risk pool,"  the better.  If coverage is not strongly - very strongly - encouraged, you can't make it available regardless of pre-existing conditions. New York tried that, requiring insurance companies in the individual market to cover everyone who applied, but doing nothing to discourage staying uninsured ("going commando," as I refer to it) like Massachusetts did.  This put New York in an "adverse selection" feedback loop, where the people who apply tend to be the people on which insurance companies will lose money.  As a result, New Yorkers in the individual insurance market pay among the highest premiums.  With Obamacare, the risk pool becomes much wider, and rates in New York's insurance marketplace will fall as much as 50%.

The third element is a combination of subsidies, tax credits or other measures to make make sure people can afford insurance.  That's pretty obvious, although there are many different ways to implement subsidies.

Policy wonks have likened these elements to the legs of a stool; unless you have all three, the stool doesn't work. The three main U.S. insurance systems - employer-provided, Medicare, and Medicaid - work because the three elements in various forms are present in each. Each of these systems have problems.  Employer-provided health insurance isn't portable.  Medicare has been a fee-for service model that pays for quantity, not quality.  Many doctors won't accept Medicaid.  While a bitch session could go on for days, each gets the three elements more or less right, which explains why they've lasted so long and have been able to cover 78% of the country.

Health reform is all about making those three elements happen for the 22% who don't have access to employer-provided insurance, are too young for Medicare, and make too much money for Medicaid. To get back to my golf analogy, until the GOP has addressed all three of those elements, they are not on the green, and their putter flailings amount to nothing more than slapstick comedy.

Ironically, parts of the GOP understand all this, or at least did so at one time.  The 2012 Republican presidential candidate implemented all three elements in Massachusetts, which now leads the nation in rates of coverage by a country mile (96%).  At the time he made that miracle happen, Romney, I'm convinced, viewed Romneycare as his ticket to the White House.  If Obamacare had not passed, I believe Romney would be President today, and the whole GOP crew would be extolling the virtues of a plan indistinguishable from Obamacare.

Obamacare accomplishments to date

1. 71 Million Kids & Adults With Private Insurance Have Received No-Cost Preventive Care.*
2. Discrimination By Insurance Companies For Children With Pre-Existing Conditions Was Banned.*
3. Consumers Received $1.1 Billion in Rebates From Their Insurance Companies.**
4. 3.1 Million More Young Adults Have Health Insurance Through Their Parent’s Plan.**
5. Seniors Have Saved More Than $6.1 Billion on Their Prescription Drugs Since 2010.**
6. 34 million seniors have received a free preventive service***
7. 105 million have had lifetime limits on insurance removed***

* “Health Reform-The Affordable Care Act Three Years Post-Enactment,” Kaiser Family Foundation, March 2013.
** "Health Reform in Action," WhiteHouse.gov, accessed 6/5/13.
*** HHS webinar, August 7th, 2013

Health re-form: Why I love Obamacare

Self-employed; too young for Medicare.  If that doesn't describe you, you have no idea how byzantine health insurance can become.  You'll never find anything like it in the writings of Franz Kafka, because it is too terrifying. When I applied for individual insurance, it took 6 hours to fill out the form.  After three hours of follow-up phone conversations, the insurance company refused to cover the female half of my family (who, thank God, are healthy) at any price.  My family finally got covered, praise the Lord, although I should point out that there is something wrong if divine intervention is needed in this neck of the woods.

Given what it took to get coverage, a competitor couldn't pay me enough to go to the trouble of switching companies, something that my insurance companies (one for the males, and one for the females) surely take into account when they relentlessly raise their prices.  

When printed, the form I had to fill out was 20 pages.  As if that weren't Kafkaesque enough, the insurance company required payment of a full month's coverage in advance, even though they reserved the right to decline coverage, a right that, in about two weeks time, they exercised.  Moreover, if I made a mistake in reciting our medical history, they reserved the right to cancel the coverage in the future.  Naturally, when I applied to a different insurance company for coverage of the female half of my family, I had to start over with a different form of roughly the same length.

Thanks to Obamacare, that form is about to get a lot shorter.  The draft form for 2014 coverage is only 4 pages. Looking through it, there are precisely the right number of questions about medical history, which is to say, none. As far as I can tell, I need to fill out page 2 for myself, fill out page 3 for my family, and then sign and date page 4.  And the single form will work for any of four insurance companies offering coverage in my region.

It's just a draft.  And it doesn't include obvious things like credit card and expiration date, or for that matter income, so as to determine if I qualify for tax credits (I don't), or which insurance company I want to go with, or which plan.  But wall, handwriting is on.  Thanks to Obamacare, in 2014 the individual health insurance market will be able to function properly.