“Why Turn Health Care System Topsy Turvy and Raise Costs for All, Just to Help 15% of the People?”

critterThe question in the blog post title is now being asked even by Obamacare/ACA supporters, including some Democrats, like the erstwhile Senator Charles Schumer, from New York, who thinks health care reform distracted his party from taking care of the middle class.

But, the premises of the question are all wrong.

In the same vein, Republican Mike Huckabee was even more to the point than Schumer about the “irrelevance of health care reform” to average Americans. Here is what Huckabee, soon to be a presidential candidate, had to say in an interview:

Q: What about ObamaCare? Is reaching those 30 million uninsured people a priority?

HUCKABEE: It ought to be a priority. But the priority should have been to deal with the 15% of people who didn’t have insurance rather than disrupt the system for the 85% who did and who were largely satisfied with insurance…..

It still matters what the facts are, even if that’s become a quaint concept.  Let’s start with the “15% uninsured” fact-let that’s implanted in Huckabee’s and everyone else’s brain. It’s very misleading. It persists because the true picture is harder to explain.

The “15% percent uninsured”  figure is a snapshot, taken at a point in time.  Over a materially longer period – more than six months, to one, two, or ten years – anywhere from 25% to 50% of Americans experience a significant spell without individual or family coverage.  That’s very large.  It’s a lot more than just “the poor.”

An even higher number of people are in perpetual fear of losing health care coverage, which keeps them in dead end jobs and contributes to  the “dead wood” we complain about in the next cubicle.    None of that may be disturbing to Huckabee or Schumer, who probably have never had to think about going without health insurance for their families, even for a few months; and haven’t worked in a cubicle for decades.

The much better count of how many people have lacked health insurance in the U.S. is documented here and here, by the non partisan Congressional Budget Office and by career analysts at the U.S. Treasury Department.

What about Mr. Huckabee’s point that Obamacare turns the health care system upside down?   Many would say, “If only it were so.”  The ACA went way out of its way to preserve the main pillars of the old health care system – private insurers, pharmaceutical companies, hospitals, and other private providers in a $3 trillion dollar system,  which leads the world in cost per client, but with worse health outcomes.  Whether you like it or not, ACA falls well short of turning the health care system upside down.

As for recent U.S. health care costs, the ACA munificently provides an alibi for anyone who raises insurance premium or shifts higher costs onto workers. Insurance companies, hospitals, and employers have been doing that for decades at rates that far outstrip general inflation and growth in worker wages or middle class income.

So, yes, health care costs have been rising, but since the ACA passed, health care inflation has actually slowed down. That is more likely due to the great recession than to ACA; but it’s a lie that health care costs have soared since the passage of ACA.

Let’s close the loop regarding Schumer’s Monday morning quarter-backing about the ACA and the middle class,  Soaring premium costs over decades have been a big factor in wage stagnation and middle class economic woes.  It’s elementary that the more a business pays for worker health insurance, especially when premium costs outpace profits, the less it can pay in wages. At the time Democrats were in control of Congress in 2010, “health insurance for all,” at affordable prices, was the single most effective and practical way of helping American workers and the middle class.

Perhaps Senator Schumer thinks Congress could have more easily attacked the other causes of middle class doldrums?  It would have been a snap to: (1) reverse NAFTA (and maybe block TPTA negotiations, while they were at it); (2) overturn “right to work” laws in about 25 states, (3) restore marginal tax rates to 90% for high income earners; and (4) put the brakes on technological advances which replace workers and lower their value. Maybe they could have done that in six days and rested on the seventh?

I will give Schumer this: The President and supporters of ACA did a horrible job explaining what they were trying to do; while conservatives have been spectacularly effective persuading a lot of middle Americans and small business folks that ACA is the bane of their existence.

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