Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Life Health > Health Insurance > Health Insurance

Repeal and Replace: A Sick Joke

Your article was successfully shared with the contacts you provided.

This year’s elections have brought a call for repeal of the health care reform under the Patient Protection and Affordable Care Act and would replace it with proposals that, among other ideas, would eliminate tax deductions for employer-provided health care.

And it’s about time. Americans are sick of this socialistic PPACA nonsense. They are eager to pay higher premiums and get less health care in return. They are sick of being squeezed by big government and are anxious to be squashed by big business.

At least, that’s what the repeal-and-replace (R&R) crowd would have us believe.

Those who want to repeal PPACA would replace it with such measures as letting insurers provide coverage across state lines, creating high-risk pool plans for people with pre-existing conditions and subsidizing lower-income families’ purchase of health insurance instead of providing them with government-paid care.

Instead of a government-backed health care program, they also would promote the sale of health insurance in the individual market. The obvious problem with that is the individual market does not offer the purchasing strength available through the group market.

The proposal to provide a health care tax credit to low-income families is aimed at diminishing the role of public health coverage such as Medicaid and Medicare. Under the proposal, people eligible for Medicare would be offered a voucher worth $5,900 per family.

In view of the average cost of employer-provided coverage today, which is close to $14,000 per employee according to one recent study, this proposal would be laughable if it were not so wretchedly indifferent to reality.

None of these proposals would do anything to eliminate the many inefficiencies in our health care system, such as the thousands of deaths that occur each year due to medical mistakes.

In other words, if R&R were to succeed, many American families would be hurt. These proposals, which proponents ludicrously call reforms, would promote the individual health insurance market, depriving Americans of the cost efficiencies of group coverage; eliminate public health insurance for all but the poorest Americans; and by placing more emphasis on the individual market, ultimately cause individuals and families to pay more for health care.

Even if these proposals were to allow more Americans to buy coverage than they can afford now, that would still be far fewer than PPACA’s promise to cover 31 million Americans now without health insurance. More likely, R&R would cause even more Americans to do without coverage.

Just think for a moment about the R&R proposal to allow insurers to offer coverage outside their licensing state. Far from giving consumers greater choice, this disgraceful plan would enable insurers to seek out approval from states offering the least consumer protections. Companies could even offer plans through the Northern Marianas, for crying out loud, a U.S. territory that has no regulatory watchdog responsible for insurance. We would then likely see an unseemly race to the bottom among states as they reduce consumer safeguards to attract more health insurer money.

The R&R bunch also proposes providing high-risk plans so that people with pre-existing conditions can get coverage. But this would cover far fewer conditions than would be mandated by PPACA, with its outright ban on eliminating pre-existing conditions. So these so-called reforms would leave many people without gravely needed coverage.

At best, R&R would only make health coverage less costly for people who already have it. Moreover, there’s no guarantee even that benefit would be seen. Unlike PPACA, these proposals offer no measures aimed at reducing the cost of care. Yes, there is a plan proposed by some advocates of this “reform” to cut down on faked diagnoses and other fraud. No one, however, knows how much fraud there is, or how much of it can be stopped. That does not appear to stop R&R advocates from advancing the foolish notion that such crackdowns are a significant cost-saving idea.

Tossing health care reform also means getting rid of new safeguards under PPACA, such as provisions that would make it easy for consumers to compare health plans, give them the right to appeal claim denials and to receive a standard menu of benefits that all plans would have to cover.

There are ways to improve on PPACA, but eliminating it altogether is not one of them. How can R&R advocates possibly say Americans would be better off without PPACA? They might as well say they would be better off without health care itself–which would very likely be the case for many if they have their way with their fake reforms.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.