The Supreme Court will soon render an opinion in King v. Burwell challenging the implementation of the Affordable Care Act. If the Court agrees with the plaintiffs, then anyone receiving health insurance through one of the federal exchanges operating in 33 states is not eligible to receive a subsidy. Several Committees in the House of Representatives are proposing to take such an opportunity to make improvements to the ACA.
In addition, the Congressional Budget Office has just released a report on the “Budgetary and Economic Effects of Repealing the Affordable Care Act,” indicating that repeal of the ACA would add $137 to the deficit over 10 years. This is because the loss of ACA imposed new tax revenues and spending cuts to Medicare would exceed the amount of money spent to expand insurance coverage.
The economist John Goodman has an excellent new book, “A Better Choice: Healthcare Solutions for America,” describing several basic changes which would greatly improve the ACA. In summary they are:
- Replace all of the ACA mandates and tax subsidies with a universal (and refundable) tax credit which is the same for everyone. This is the fairest way to subsidize healthcare for all and it also removes the huge market distortion provided by employer provided health insurance which is tax exempt. The tax credit would be about $2500 per individual and $8000 for a family of four, the approximate cost of catastrophic health insurance and also the average cost of Medicaid.
- Replace all of the different types of medical savings accounts with a Roth Health Savings Account (after-tax deposits and tax-free withdrawals).
- Allow Medicaid to compete with private insurance, with everyone having the right to buy in or get out.
- Keep the ACA exchanges which would be required to provide change-of-health status insurance for the protection of the chronically ill.
Changes such as these would dramatically lower the cost of American healthcare by making all of us directly responsible for the cost of our own healthcare. They would also virtually eliminate the perverse market effects of the ACA which encourage companies to cut back on numbers and working hours of employees. This in turn would speed up the growth of our stagnant economy!
It Does Not Add Up 
Jack,
I am not very familiar with the details of the ACA, nor the specific ways altering it will improve it. However, I become a bit uneasy with the concept of making everyone somewhat responsible to their own health and health care costs. So many factors lead to disease and illness that are prompted, if not caused, by forces beyond our control. Even such subjective terms as “lifestyles”, “daily habits”, and place of living and class status can best be understood as beyond our control, let alone the general recognition that we are “irrational” as well as “rational beings”. This notion of individual responsibility and ruggedness are often more mythological than scientifically reasonable or historically accurate.
Doug
With or without the ACA we’re already moving in this direction in order to control rapidly increasing costs. The ACA bronze plans, the least costly, have very high deductibles. This means that the insured starts out each year paying the full cost of care and so presumably will be paying close attention to price.
All I’m saying is that we should recognize what’s happening as inevitable and design insurance accordingly, i.e. insurance is for catastrophic care with a high deductible. In addition, Health Savings Accounts can be used to help people be prepared for routine health needs.
Jack,
I think I follow you in reference to direction. Perhaps we should broaden the discussion. ACA seems to have been a creation of insurance companies and political realities. The matter of a single provider, something on the order of public education and public health was not considered with any possibility of success in this political era. Now that our public education has deteriorated so badly and we seem to be moving towards a caste society, I think we have lost sight of what should be accessible for all of our citizens rather than just the successful and fortunate people. Should not public education and public health care have some base of access to all?
I do appreciate your focus on the specifics. But I am unclear about your ideals. I recall in your general philosophical statement the base of Christian ethics. Have we not moved away from Christ’s assistance to the poor and unfortunate? And isn’t the Republican approach primarily to dissolve whatever remnants of the FDR policies remain?
Doug
There are problems with our public education system but I don’t think it’s as bad as you imply. We have equal opportunity but unequal outcomes. We need to try harder to improve outcomes especially for the disadvantaged. I am involved in this effort through the Learning Community.
I support the purpose of the ACA, to provide healthcare insurance for all. But I think it was poorly designed and could be greatly improved, mainly to make it much more efficient and less costly, both for individuals and for the government.
The main purpose of my blog is to draw attention to the excessive costs of our federal government, the fact that our national debt is way too high and still growing rapidly. To me it is a moral issue to solve this problem before our country goes bankrupt. And entitlement spending, especially the cost of healthcare, is the most out of control of all government spending. This is why I keep talking about changing the ACA to control costs.
As I see it, Republicans are primarily interested in economic freedom and government efficiency, which are related to each other. I don’t think Republicans are against welfare, I certainly am not. They just want it to be operated efficiently, like all other government programs.
As I mentioned in an earlier post, I am a “cultural Christian”, in the sense that I try to practice Christian ethics, i.e. Christianity without the miracles. We definitely need to help the poor and unfortunate. That’s what our vast safety net is designed for, and I would say, does very generously.
Jack,
Perhaps we should sit down over coffee and learn where are basic principles might find reconciliation. Support for each position can always be found. If we explored the rationale for each principle, perhaps we would establish a common ground for some joint efforts. I am sure that each of us has become logical or syllogistical in our data from the world. Let’s examine the basic premises, look for contradictions and then we may find some general agreement. For instance, I have difficulty with economic freedom when it seems to mean profit more than mutual gain. Caveat emptor may have had validity in Roman times. But I find few students who have even heard of the phrase. My problem with government efficiency is not that it should not be monitored but how to clarify what should be a governmental responsibility and what can be left to the individual. The matter of a “vast safety net” too often leaves children under-nourished and prisons filled with the homeless and mentally ill. Anyway, I think a conversation might enhance our exchanges. I am fairly free during the weekdays.
Doug
How about going out for a beer say next week around 4:00 or 4:30 P.M.? Just send me an email at jackheidel@yahoo.com with the time and place. If you don’t want to do this, then we can go for coffee.