Draining the swamp is dangerous work

 

The swamp is full of alligators and as Pat Robertson said this week, when you’re trying to drain the swamp don’t let the alligators drag you back in.”

Republican’s announced their plan to repeal and replace Obamacare this week.  Clearly, they aren’t ready to address such a huge and complex mess. It’s unfortunate but true that after 8 years of promising to repeal the Un-Affordable Care Act they have no real alternative plan to offer as a replacement. 

The current effort to replace Obamacare looks like the alligators are trying to drag us back into the swamp. Some critics have been inspired to call the proposed new bill Obamacare lite.

I have written much about health care over the years. The problem is that unless we begin to address the underlying structural problems of health care nothing is going to change. All of the efforts that have been submitted so far suffer from the same basic problem. That is we continue to insist on modifying an outdated insurance model that was developed during WWII. 

At that time wage controls caused employers to offer health insurance benefits to employees to replace raises. Ever since, employer provided health care has become the way most people received health insurance. 

The problem is as benefit levels increased and large employers with large groups were able to negotiate lower costs small employers and individuals had to make up for the discounts insurance companies provided to the large employers. To make matters worse, when employees retired they discovered they could no longer afford the plans that had been provided by their employer. The government stepped in with Medicare to help individuals get health insurance they could not afford on their social security income.

Medicare actually made the problem worse since the government doesn’t pay the providers for the full cost of services. The result was providers increased their fees to cover the discounted payments from the government. The result was medical costs spiraled out of control and once again individuals and small businesses were left to pick up the tab. 

If President Trump wants to fix health care he has to engage his deal making tactics and end the current system of employer/government provided health care. It will undoubtedly take a plan that phases in over time so individuals can adjust but it is far past time to look at new models that don’t carry the same built in problems of the old WWII system.

I have said before that insurance companies need to sell the policies directly to individuals and premiums must be the same for all policyholders. They can sell different types of plans for different prices, but the premiums for the plans must be the same regardless of age, sex or health. 

The price of coverage can only vary based on the level of coverage. In other words, a plan that provides full coverage will cost the same for all who select that type of coverage, and a catastrophic coverage plan would be priced the same to all buyers as well.

Under the current system of health insurance networks, buying across state lines will not do much to reduce the cost of insurance and will most likely result in less coverage than the buyer expects.

Health savings accounts make great sense in helping individuals manage their health care costs but to be truly effective they need to be part of a massive overhaul of our tax system. Taking a deduction on your tax return for a contribution to a health savings account will not work when half of the population is not paying taxes. Especially when it is that half that needs the most help.

Obamacare is not the only alligator in the swamp. Eight years of failed foreign policy has left us a world where America is no longer respected or feared by third world dictators who could not stand up to American military power but who could do serious damage trying.

Government regulations on banking and the environment are killing small business - the engine that drives economic growth. Misguided energy policies are wasting enormous sums of money on failed green energy and killing good paying American jobs. And our tax policies are driving private sector employers to move their operations to more favorable tax havens.

Trump promised to drain the swamp. He will need to kill a few alligators if he expects to have any lasting impact on the swamp in DC. 

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