Ken’s Take on the World


Healthcare: Commodity or Essential Right

The recently, spectacularly, failed American Healthcare Act (AHCA), once again, brought to the forefront the debate on whether healthcare access should be considered a commodity, much like an automobile, subject to the whims of a free market and made available to those who can afford it or, rather, that healthcare is an essential right of all Americans that must be guaranteed by government.  Democrats appear united behind the concept that healthcare access is crucial to society and must be available to every US citizen regardless of their economic status.  As the debate over the AHCA progressed, it became obvious that Republicans are divided over this central question.  Polling shows that overwhelming majorities of Americans believe every citizen should have access to high-quality, affordable, healthcare.  In this, it appears the GOP is at odds with the majority of Americans.

 

This week, President Trump signaled the AHCA is not actually dead and that his campaign pledge to repeal and replace the Patient Protection and Affordable Care Act, also known simply as the Affordable Care Act (ACA) or, “Obamacare” continues onward.  The problem with this position is that the President has not articulated what this would look like.  Even with Republican majorities in both chambers of Congress, and without input from Democrats, a coherent plan that would meet the President’s promises of providing affordable health insurance to even more Americans, and at lower costs than the ACA, was not presented.  Competing factions within the Republican Congress ensured that no bill put forth would garner a majority of votes or even entice moderate Democrats to join in support.  Party leadership attempted to rush the bill through the House even prior to scoring by the nonpartisan Congressional Budget Office (CBO) which ultimately decided that, although ten-year cost projections would reduce the budget, the result would be more people without health insurance than prior to enactment of the ACA.

 

After the AHCA was pulled prior to a vote, the President commented, “Who would have known that healthcare would be so complicated?”  What?!?!  Besides anyone who has ever studied this topic?  This point underlies a central problem within the Trump Administration.  There is a serious lack of competent Administration leadership that might be able to shepherd complicated proposals through a Congress that is itself lacking in effective leadership that is committed to promoting and implementing legislation that will serve to actually benefit the American people.  Basically, Republicans have demonstrated that, since at least 2010, they lack the ability, or desire, to govern in the best interests of the people.

 

The failure of the AHCA effectively leaves the Republican leadership in Congress with two choices.  They can continue in their efforts to undermine the ACA which will lead to its eventual collapse, or, they can work with Democrats to strengthen the law which is what a majority of Americans currently favor.  It should be noted that the ACA has been effective and would continue to remain viable for at least the next decade but for efforts of the Republican Party over the past seven years.  Elected Republicans, and right-wing talking heads on radio and television, have spent the last seven years misleading the American public.  This has resulted in ballot box gains, however, it has not actually helped the American people.  While the ACA did not seriously further the debate on whether healthcare was an essential right versus a commodity available to the highest bidder, it did suggest that access to insurance to provide for healthcare expenses was a necessary thing that should be promoted by government.  In contrast, the debate among Republicans since 2009 has brought into the open the role of government in healthcare access at all levels.  It should be noted that prior to 2010, there was no question that government should ensure the availability of some access to healthcare for all Americans.  In 1986, President Ronald Reagan signed the bipartisan Emergency Medical Treatment and Active Labor Act (EMTALA) into law.  Likewise, COBRA was enacted under the Reagan Administration which provided individuals with a continuity of health insurance coverage.

 

The most recent debate between Republicans over the AHCA has placed a focus on whether government has any role in determining access to health insurance or healthcare itself.  This debate also served to highlight a disconnect between elected Republicans in Congress and their constituents.  Had the AHCA passed, the harms would have been felt significantly more among rural voters who overwhelmingly voted Republican over the past several election cycles.  The more extreme members of the GOP who make-up the Libertarian-wing (aka the Freedom Caucus formerly known as the Tea Party caucus) believe healthcare should be left to the winds of a completely free market.  Health insurers should be let alone to serve only the customers they desire and to charge whatever rates the free market might bear.  Let the buyer beware lest they procure a policy only to find out it lacks the protections necessary when they are needed, or worse, they are dis-enrolled when they become ill or seriously injured.  Somewhat more moderate Republicans seek to provide competition among insurers by removing obstacles to the sale of health insurance policies across state lines.  Theoretically, this appears to be reasonable, however, there are a significant number of realities that make this an unattractive proposal.  The biggest one is that insurance companies establish provider networks where they operate.  Healthcare providers are not likely to want to participate in a network that is out-of-state, perhaps in a different time zone, when they need to have their billing issues resolved or if they need to seek authorization for patient care.  This is inefficient and costly.  Another major issue affecting consumers is relating to the need to, perhaps, sue an insurance company for denial of a claim.  Consumers would be subjected to the laws of a particular state which might be much more favorable to the insurance company in a classic David and Goliath tale.

 

I doubt there is anyone who disagrees with the idea that society functions better when people are healthier.  Employee productivity is increased, chronic healthcare expenditures are decreased, and individual satisfaction is improved.  The United States outspends every other developed nation on healthcare but has significantly lower health outcomes on almost every measure.  Civilized societies throughout the world recognize this.  In promoting the well-being of their respective nations, leaders have already debated whether healthcare should be construed as a basic right to be assured by government.  It has been unanimously affirmed by economically- advanced societies that some level of healthcare must be provided for each person as by doing so it benefits every person.  The United States continues to be an outlier.  If, by independent measures, it was demonstrated that our status as an outlier made the health of our nation’s citizens better it would make perfect sense to continue our current system of healthcare delivery.  Unfortunately, this is not the case on ANY measure of national health.  Republicans continue to refuse to acknowledge this and continue to permit healthcare to consume ever-larger amounts of spending and an ever-growing share of our gross domestic product (GDP).

 

It is obvious the Republican Party is incapable, or unwilling to, of addressing this.  We, the people, must continue to demand healthcare access for all.  GOP-led efforts to undo the most significant healthcare reform in a generation is harmful to patients, providers, and insurers.  These efforts undermine the healthcare infrastructure and will lead to a significant collapse that would cause all of us to suffer.  If we recognize that a healthy citizenry makes for a more robust society, we must not maintain the idea of healthcare as a commodity to be enjoyed only by those who can afford it.  Essential healthcare must be available for all people.  This must be ensured by government.



Hear ye, hear ye

Within the next two weeks the United States Supreme Court will issue its ruling on the Affordable Care Act (ACA). There is much speculation as to what the Court has decided (yes, the case has already been decided) when it issues its ruling on the Constitutional questions raised by the Affordable Care Act. Some think it will be completely struck down while others (you have to love dreamers) believe it will be completely upheld. Most of us who have actually read the Act, believe it is quite likely that the Justices have decided that parts of it fail to pass Constitutional muster and must be struck down while leaving large portions of the ACA intact. In any event, the ruling of the nine men and women who comprise the highest court in our land, will have far reaching effects on the lives of everyday Americans. Not only will their decision(s) affect average folks, the impact will be felt by healthcare providers, insurance companies, pharmaceutical companies, and medical device manufacturers.

For the President, the ideal situation would be for the Justices to decide that the entire Act is Constitutional, thus bouncing any attempts to modify or repeal all, or part, of it to Congress which is unlikely to muster the support for doing so. I, personally, think this scenario is unlikely for two reasons. First, I can see a lack of Constitutional backing for the individual mandate that is a key provision of the Act. Second, given the current make-up of the Court, I do not see a majority of its respected members agreeing that this provision is Constitutional. Certain members of the Court are not especially keen on having the Government require individuals to do certain things. In many ways, this is a very good thing.

For Congressional Republicans, an ideal scenario would be for the Court to strike down the entire Act. This would allow them to put forth legislation addressing the provisions of the Act that a majority of Americans have repeatedly identified are quite acceptable to them. This would allow Republicans, with very broad bipartisan support, claim they support meaningful healthcare reform. I also do not believe this scenario is very likely because precedent shows that the Court has supported the right of Congress to enact laws that address interstate commerce. The issue the Court must grapple with here is that there is no specific severability clause that would permit the Justices to only strike portions of the Act. Not that there is no precedent for allowing this, it is, however, interesting that no such clause was included in the final legislation that was sent to the President in March of 2010.

Personally, I am inclined to believe that the Justices have decided that the Act can survive with the removal of the individual mandate. It is not up to the Court to decide that the hardship forced on corporations resulting from a loss of revenue as this is not a question posed by this case. So, what happens if the individual mandate is struck down and the remainder of the Act survives intact?

Medical insurances companies will, initially, face the greatest financial burden. They will (continue to) be forced to provide coverage to anyone regardless of medical condition. Further, they will (still) not be able to drop people when they become ill. These are both extremely important issues for individuals who, inevitably, will require healthcare services at some point in their lives. Pharmaceutical companies are also on the hook for reducing the cost of medications to some groups and this would not change with or without the individual mandate. Hospitals and other healthcare providers will be hurt with the loss of an individual mandate as Medicare and Medicaid reimbursement rates are slated to be kept under a tight rein under provisions of the Act. With otherwise healthy folks showing up in Emergency Rooms, reduced reimbursement and increased volume will make it a challenge to continue to provide high-quality care.

The impact on businesses and individual purchasers of health insurance will become very noticeable without an individual mandate. These folks can expect their premiums for health insurance to rise significantly especially for those who have pre-existing conditions or who work in inherently dangerous fields. Without the guarantee of a large, relatively low-risk, pool of people purchasing insurance, companies that sell insurance will be forced to raise rates on everyone who does buy in order to maintain a healthy profit-margin and in light of the fact that individuals cannot be denied insurance. Businesses and corporations will likely decide that it may be cheaper to self-insure thus drawing even more customers out of the health insurance marketplace. As this begins to happen health insurance providers will begin to go into bankruptcy leaving millions with insurance policies that are worthless. This is the worst case scenario, however, it is what will ultimately lead to something I have recommended for more than a decade. As insurers fail, healthcare providers become sucked in by a staggering loss of revenue, and they, too become bankrupt. The Government, belatedly, recognizing that healthcare is not a commodity that cannot be satisfied by the traditional laws of supply and demand, will have to take action and a form of Universal Healthcare will be implemented.

Could this be avoided? Not likely. America has the greatest medical technology in the world. The healthcare industry in the United States makes up about 1/6 of our Gross Domestic Product (GDP). The costs associated with the development of new drugs and medical devices that are designed to improve the quantity, or quality, of life are, well, quite costly. Healthcare in this country is, literally and figuratively, too big to fail. Unfortunately, finding a way to pay for this is an issue. For far too long America and its leaders have acted as though healthcare, and access to it, is a commodity that is to be financed based on free-market principles alone with very limited regulation. American citizens have become so insulated from the actual costs associated with healthcare through employer-provided insurance benefits. We have come to expect the very best in medical innovation even though it is not always necessary. We demand the newest drugs. We know we will receive tests performed on the latest diagnostic machines and that a robotic system can be used for almost every surgical procedure. This is neither cost-effective nor wise. However, when the Affordable Care Act was introduced, critics called attempts to look at the feasibility or appropriateness of care, people balked and critics derided this, quite incorrectly, as the implementation of, “death panels.”

Instead of implementing a Universal Healthcare system, or at least the framework of such a system, when they had the opportunity, Congress attempted to circumvent the inevitable. Healthcare has become a major burden on businesses and individuals. A uniquely American model based on the healthcare systems of every other industrialized, and a significant number of developing, nations should have been seriously discussed and implemented. We had the chance to do this in 2009 (and a number of times in the century prior) and we failed. We were provided legislation that, despite its length, failed to ensure that every citizen had insurance. The final bill failed to provide sufficient cost-containment mechanisms. The expansion portions of the bill were challenged by Attorneys’ General, allegedly, acting in the best interests of their citizens. And this is why we eagerly, and anxiously, await the opinion of nine folks in black robes.

One other prediction. Whatever the ruling(s) that are presented, they will be nearly unanimous. The Court will have considered its own integrity and, realizing the view of the Court in recent years as more in lockstep with their Presidential nominator’s political affiliations, will make sure that whatever conclusion has been reached is supported by a near-unanimous Court.