I've been following some of the commentary on Republican proposals for replacing Obamacare.
Seems Republicans and President-elect Trump want to keep the popular portions of Obamacare. Inability to be excluded for preexisting conditions and kids staying on their parents' plans until age 26 being two of them.
Some are saying the money problem with preexisting conditions is that people don't have to buy insurance until they are sick. The fix
is supposedly to require that people have ongoing insurance if they get to keep being covered. Thus, you force people to pay for insurance when they are well if they want it when they are sick (the usual carrot for buying any kind of insurance) ever onward.
But, how that differs from the pre-Obamacare model of not being accepted if you have a preexisting condition is a question. If you already had healthcare insurance then you would already have been accepted before getting your condition. So preexisting condition would not be an issue. (However, the change would help those who were dumped when a serious health condition came on or for those who had a preexisting condition as children before ever getting their own health insurance.)
More importantly, the individual market is not presently a big generator of health insurance premiums. Only 7%
of people currently covered do it through the individual market. The elephant in the room is employer coverage. That amounts to 49% of the coverage given.
It's hard to find apples to apples statistics, but Kaiser Foundation research shows that the average individual employer covered plan
cost $6,251 per year in 2015. By contrast the 2015 average "second lowest cost silver plan" for "a 40 Year Old Non-Smoker Making $30,000 / Year"
before subsidies was $3,192. So, employers pay about double the average rate as individuals for an individual policy. That would make employer covered policies the biggest income producer for health insurance companies.
So, the employer mandate requiring companies to cover their employees is much more important for health care insurance providers than the individual mandate requiring individuals to buy insurance. This is both in terms of the premiums paid (about double) and the number of policies issued (about 7x more).
Obamacare's nice benefits cost money. So, if we're going to keep requiring health care insurance companies to provide them, we can't expect health insurance costs to go down. Or at least not without insurance companies being forced to pull out of markets or go bankrupt.
Full service healthcare for everyone
is a wonderful goal. But, it costs lots of money. And when people don't directly see how much a service costs and have a stake in paying that cost, non-essential services will be recommended and accepted just because they're available at little or no extra cost. Similarly, high cost peripherals will be used because they are as readily available as lower cost options. In almost every other area of life (food, clothing, transportation, education, recreation, technology) you choose the level you want and pay for the level you choose. But, if the "Virgin Mobile paylo healthcare plan" costs about the same as the "iPhone healthcare plan", who wouldn't choose the iPhone version?
There needs to be a clear incentive for the individual to cut medical costs to services and supplies that are important or essential. Until then we're fooling ourselves about this plan being substantially better than that plan. Right now the Republicans do not have a plan
significantly different than Obamacare.