John C. Goodman challenges Americans to rethink healthcare in his book from the Independent Institute, Priceless: Curing the Healthcare Crisis. In the wake of the Supreme Court decision that determined that the individual mandate was constitutional, there has been much talk about “repeal and replace.” That has lead to the question, what does the GOP have to offer to replace Obamacare?
While Goodman’s suggestions throughout Priceless should probably form the basis of any GOP plan, it’s questionable whether or not that will actually happen. The book is necessarily repetitive, because it suggests a very radical change from what we currently have. Bluntly, the concept of people paying for routine healthcare at a market rate with their own money could be considered frightening, especially to seniors on a fixed income. But, one must keep in mind that Goodman is a long-standing proponent of Health Savings Accounts (HSA’s), and his plan is that people rely HSA’s for healthcare costs not covered by real insurance. In his plan, health insurance would resemble casualty insurance, and would primarily be there to cover major health care expenses.
Radical as his theories may be, Goodman has managed to get the endorsements of a couple former CBO Directors, and a former Administrator of the Centers for Medicare and Medicaid Services, based on posted reviews. Well, it would be a better sign if those officials were still working in their respective agencies, and stated publicly that they agreed with his ideas. Of course there are some GOP politicians that have come out saying that they are impressed with Goodman’s book and theories. But there is nothing from Mitt Romney. That’s not surprising, since Goodman has used Romney’s healthcare reform in Massachusetts as a policy poster child of what not to do – or an example of coming attractions nationwide under Obamacare. Either way, it is anything but praise, like the following:
In fact, there is nothing in the legislation [the Affordable Care Act] that makes “healthcare a right.” Nor is there anything in the new law that makes the role of government more just or fair. To the contrary, a lot of knowledgeable people (not just conservative critics) predict that access to care is going to be more difficult for our most vulnerable populations. That appears to have been the experience in Massachusetts, which President Obama cites as the model for the new federal reforms. True enough, Massachusetts cut the number of uninsured in that state in half through then-Governor Mitt Romney’s health reform. But while expanding the demand for care, the state did nothing to increase supply. More people than ever are trying to get care, but because there has been no increase in medical services, it is more difficult than ever to actually see a doctor.
Far from being fair, the new federal health law will give some people health insurance subsidies that are as much as $20,000 more than the subsidies available to other people at the same level of income.
Right after the passage of the Affordable Care Act, Obama administration health advisers Robert Kocher, Ezekiel Emanuel, and Nancy-Ann DeParle announced that the new health reform law “guarantees access to healthcare for all Americans.”
In fact, nothing in the act guarantees access to care for any American, let alone all Americans. Far from it. Again, take Massachusetts as the precedent. The waiting time to see a new family practice doctor in Boston is longer than in any other major US city. In a sense, a new patient seeking care in Boston has less acess to care than new patients everywhere else.
Fairly harsh words for Romney’s healthcare reform that the campaign has undoubtedly been trying to figure out precisely how to deal with on the road. But, there’s one option, albeit unlikely. Why not admit that the Massachusetts health care reform law was a mistake? It’s not like there’s any shortage of factual proof to back that assertion, since Goodman has already taken the time to not only find it, but also expound on it. Sure, it’s off the reservation for a candidate to admit flaws unless there is absolutely no other option. The Romney camp isn’t there, but this isn’t a typical situation either.
While Obamacare has some popular features, in general it is disliked by a majority of Americans. Now that the actual costs for the program are becoming more clear, the need to come up with “something better” should be high on the list of things to do for the Romney folks. Saying that repealing Obamacare on day one isn’t enough – back to that whole GOP “repeal and replace” theme. Goodman’s plan is to move healthcare to a market-driven system, and this is something that a good businessman can manage much better than a typical politician. The left has been hammering on Romney’s background at Bain Capital in an attempt to portray him as an out-of-touch corporate man. But if the GOP “replace” plan was to slowly shift healthcare and health insurance to a true business model, even a past as the most ruthless of corporate marauders could be sold as an asset.
Goodman points out that the primary problem with healthcare is the fact that there is no real price for anything in the industry. Because of this, this complex system does not behave like any other economic system. Contrary to what policy makers would like to have people believe, the problem of increasing healthcare costs is not the amount of money being paid to providers. The problem lies in the fact that people are encouraged to over-consume healthcare services when they are healthy, and under-utilize services when they are ill. This is the direct result of insurance companies catering to the healthy, primarily because their care costs less. Because people are not directly paying for services rendered, and have no real control of healthcare dollars, there is no incentive for them to be frugal in their consumption of healthcare. Bureaucracy has created an environment of wasteful spending, and perverse incentives that keep those that need care the most from actually getting it at all, or at the very least, getting it in the most cost effective way possible. Priceless, while a repetitive text, should be considered required reading for anyone that honestly wants to learn about what ails our current healthcare system, and what problems Obamacare will undoubtedly exacerbate in the near future.
Obama claimed that he made history with his landmark healthcare legislation. If Romney could manage to be daring enough to publicly admit that his Massachusetts plan is fundamentally flawed, and offer a solution along the lines of those offered by Goodman, the upcoming election could end up re-writing that historical moment. The Supreme Court left this issue squarely on the shoulders of the politicians, and that should be interpreted as a call to the GOP to declare open season on failed Obama policies in healthcare, and everything else. The only wrong answers are already on the books thanks to Obama. It remains to be seen whether or not Romney will have the courage to stand up and offer something more than just a promise to undo Obamacare on day one. What about day two?Wake up Right! Subscribe to our Morning Briefing and get the news delivered to your inbox before breakfast!