New Healthcare Reform Legislation Is Doubtful On The Federal Level


Leonard Zwelling

The first thing to understand is that ObamaCare, the program of government-subsidized, guaranteed insurability health coverage, is used by a relatively few number of Americans. Most Americans under 65 still get their health insurance provided by their employer. It has been estimated in the lay press that 8.8 million Americans have signed up for ObamaCare in the latest, Trump-shortened, enrollment period. That’s about the same number that signed up last year under President Obama. That’s 9 million out of over 300 million Americans. Many more millions are insured by Medicare, Medicaid, CHIP and the various types of employer-sponsored arrangements. Thus, even if the Tax Bill “killed” ObamaCare, it would affect a small proportion of the population.

Next, the elimination of the penalty for not having insurance certainly didn’t seem to dissuade the 9 million from acquiring ObamaCare insurance. The Tax Bill didn’t seem to affect those folks’ quest for coverage at all. And it won’t.

It is likely that many Americans (many being a relative term) will opt to forego insurance now that having it is not necessary and not having it demands no penalties at tax time. This in turn might affect the premiums of those who wish to continue in ObamaCare by raising their premiums because those who opt out are likely to be well and those who stay in are likely to need the coverage. The insurance pool will be sicker. This may also raise the rates of all those people insured at work, insurance companies being in both the ObamaCare and non-ObamaCare markets. That in turn may adversely affect the raises people get at those jobs as employers take on the costs of higher priced insurance instead of paying out greater wages.

Thus, I believe that the Tax Bill will make little difference in the health insurance markets, but what difference it will make is likely to lead to higher premiums and lower wage increases. And it won’t jolt the economy to 4% growth either. That’s not a good thing, but 4% growth was never realistic anyway.

Thus, as Mr. trump has said, the time is right for a new health reform plan, right? NOT!

First, Congress is exhausted from health reform plans. First, there was the 15-month trudge to ObamaCare that had to be passed by a combination of legislative legerdemain by Nancy Pelosi (ramming the Senate version of the bill through the House) and a reconciliation package. Then there were the fifty or so attempts to repeal ObamaCare while Mr. Obama was still in office. All failed. Then there was the failed attempts to repeal it when the GOP had control of both houses of Congress plus the White House and they still couldn’t pull it off because the pluses of ObamaCare were outweighing the negatives and the last thing many state governors wanted was the elimination of Medicaid expansion that had arisen under ObamaCare.

In other words, the people of the United States and the majority of their representatives have become used to ObamaCare and have yet to hear of a viable alternative.

So will there be one?

The Democrats have two.

The first is obvious. Fully reinstate ObamaCare. That is not likely to happen for that would be the reversal of a major tenet of the Trump Tax Bill and the president would never sign that.

The second is a single payer system, Medicare for all. This has no chance of seeing the light of day in a GOP-controlled House or Senate.

So both Democratic ideas are DOA.

How about the Republican idea? What Republican idea? They don’t have one. Well, they did. It was a system characterized by mandatory insurance purchasing called the individual mandate, subsidies for the poor to buy insurance, and the use of electronic purchasing markets for all to have access to insurance. Sound familiar? It should. It is RomneyCare in Massachusetts in 2006 and ObamaCare in America in 2010. That’s right. These were GOP ideas.

If the president is going to lead the charge to some new healthcare and health insurance reform, his minions better come up with an idea. Since they don’t have one, reform is unlikely and we will probably be muddling through with the latest iteration of an American non-system of health insurance.

As that famous Republican Clint Eastwood might say, “Swell!”

Don’t look for your friends on Capitol Hill to provide you with any new healthcare legislation. It is far more likely that the states will begin to experiment to find a middle ground between wholly expanding Medicaid to cover those above the 138% federal poverty level and going broke.

I think some will figure it out as some already have (e.g., Ohio). But don’t look to Washington for a fix. It’s way too broken.

Besides, those guys are out of ideas.

Leonard Zwelling