Authored by Jeffrey Tucker via The Foundation for Economuc Education,
A government program that is ruined by permitting more choice is not sustainable.
It’s not just that Obamacare is financially unsustainable. More seriously, it is intellectually unsustainable, even though this truth has been slow to emerge. This has come to an end with President Trump’s executive order last week.
What does it do? It cuts subsidies to failing providers, yes. It also redefines the meaning of “short term” policies from one year to 90 days. But more importantly–and this is what has the pundit class in total meltdown–it liberalizes the rules for providers to serve health-coverage consumers.
In the words of USA Today: the executive order permits a greater range of choice “by allowing more consumers to buy health insurance through association health plans across state lines.”
The key word here is “allowing” – not forcing, not compelling, not coercing. Allowing.
Why would this be a problem?
Because allowing choice defeats the core feature of Obamacare, which is about forcing risk pools to exist that the market would otherwise never have chosen. If you were to summarize the change in a phrase it is this: it allows more freedom.
The tenor of the critics’ comments on this move is that it is some sort of despotic act.
But let’s be clear: no one is coerced by this executive order. It is exactly the reverse: it removes one source of coercion. It liberalizes, just slightly, the market for insurance carriers.
Here’s a good principle: a government program that is ruined by permitting more choice is not sustainable.
The New York Times predicts:
Employers that remain in the A.C.A. small-group market will offer plans that are more expensive than average, and they will see premiums increase. Only the sickest groups would remain in the A.C.A. regulated risk pool after several enrollment cycles.
Vox puts it this way:
The individuals likely to flee the Obamacare markets for association plans would probably be younger and healthier, leaving behind an older, sicker pool for the remaining ACA market. That has the makings of a death spiral, with ever-increasing premiums and insurers deciding to leave the market altogether.
The Atlantic makes the same point:
Both short-term and associated plans would likely be less costly than the more robust plans sold on Obamacare’s state-based insurance exchanges. But the concern, among critics, is that the plans would cherry-pick the healthiest customers out of the individual market, leaving those with serious health conditions stuck on the Obamacare exchanges. There, prices would rise, because the pool of people on the exchanges would be sicker. Small businesses who keep the more robust plans—perhaps because they have employees with serious health conditions—would also likely face higher costs.
CNBC puts the point about plan duration in the starkest and most ironic terms.
If the administration liberalizes rules about the duration of short-term health plans, and then also makes it easier for people to get hardship exemptions from Obamacare's mandate, it could lead healthy people who don't need comprehensive benefits to sign up in large numbers for short-term coverage.
Can you imagine? Letting people do things that are personally beneficial? Horror!
Once you break all this down, the ugly truth about Obamacare is laid bare. Obamacare didn’t create a market. It destroyed the market. Even the slightest bit of freedom wrecks the whole point.
Under the existing rules, healthy people were being forced (effectively taxed) to pay the premiums for unhealthy people, young people forced to pay for old people, anyone trying to live a healthy lifestyle required to cough up for those who do not.
This is the great hidden truth about Obamacare. It was never a program for improved medical coverage. It was a program for redistributing wealth by force from the healthy to the sick. It did this by forcing nonmarket risk pools, countering the whole logic of insurance in the first place, which is supposed to calibrate premiums, risks, and payouts toward mutual profitability. Obamacare imagined that it would be easy to use coercion to undermine the whole point of insurance. It didn’t work.
And so the Trump executive order introduces a slight bit of liberality and choice. And the critics are screaming that this is a disaster in the making. You can’t allow choice! You can’t allow more freedom! You can’t allow producers and consumers to cobble together their own plans! After all, this defeats the point of Obamacare, which is all about forcing people to do things they otherwise would not do!
This revelation is, as they say, somewhat awkward.
What we should have learned from the failure of Obamacare is that no amount of coercion can substitute for the rationality and productivity of the competitive marketplace.
Even if the executive order successfully liberalizes the sector just a bit, we have a very long way to go. The entire medical marketplace needs massive liberalization. It needs government to play even less of a role, from insurance to prescriptions to all choice, over what is permitted to be called health care and who administers it.
Freedom or coercion: these are the two paths. The first works; the second doesn’t.
Force the "young & healthy" who don't need it into it by creating..."a law".
Yeah!
That seems completely fair! ;-)
So, the second choice it is then!
Get the government out of our bodies. Open market, let the people choose their care. Who and what they want, not by some bureaucrat that is being bought out by Insurance companies, to fatten their teet's.
why not just raise taxes? Nobody's protesting about that so why not?
Anybody with a job is a rich person for a socialist no matter how much he makes...
A Black Mountain Side of Good Times Bad Times leaves many Dazed and Confused. How Many More Times is there this Communication Breakdown? I Can't Quit You Baby but You Shook Me! So, Babe I'm Gonna Leave You because Your Time is Gonna Come.
NYT .... Atlantic .... VOX ... CNBC
WTFGAF?
Ya know, I was just commenting to Mrs.N, it would be like shooting over a baited field in Gainesville tomorrow ;-)
Because Choice is the opposite of Single Payer.
Choice is one less vehicle for wealth redistribution...
Can't have that...
Healthcare shouldn’t be a for profit driven market. Health is a matter of national security. When the next plague hits, those with better functioning healthcare systems will fare way better. The reason- the plague won’t give a shit about your race or social class. Neither will the flu. Or the next resistant bacterial strain or TB. By letting people get sick because : they’re fat and they deserve it, they’re homeless and they deserve it, they’re leeches and they deserve it leaves everyone vulnerable. It’s not something we can really debate. Science gives two fucks about anyone’s opinions. Making it a for profit system that drives class warfare is about as stupid a plan as any. Do you consider the military “socialized”? No. It’s a matter of national defense and security. Everyone puts in(taxes) and is safer come war or natural disaster. Healthcare is the same. You’re not “socializing” it because it’s a national safety and defense issue. Get passed this obsession with left and right and think for 2 goddamn seconds.
Ah, ok. So healthcare without a profit motive is what?
Medicaid? Medicare? VA Care?
I am not a medical professional, but my wife (now passed) was an RRT. I don't really want to explain to you what that means, but she worked critical care in a major metropolitan medical center.
I can tell you that she was not going to work for free. Or at cost.
She worked her ass off, saved people's lives every shift she worked, she was a highly regarded professional.
She wasn't going to go to work for free.
Healthcare is about the people who deliver it, not some shithead bureaucrat politician and until you commie fucks understand that, you should shut the fuck up about it.
When you wake up in an ER somewhere, who's face do you want to see?
Some shithead with a clip board or a fully qualified practitioner?
If I'm going to be forced to pay for your health care, then I deserve the right to tell you what to eat, what not to eat, to force you to get off your fat ass and walk 2 hours each day and quit watching TV. You do not get to smoke cigarettes nor drink alcohol. Until I can control your behavior that sucks the cost of healthcare you can simply fuck off and die.
"When the next plague hits, those with better functioning healthcare systems will fare way better."
And government-run health care systems will fare "way better"? Thanks for the laugh!
Economuc Education - sounds about right
I had to check that out. It looks like a TD mistake, it is spelled correctly on the source website.
This whole Obamacare debate is getting so tedious when looking from other countries who have had national health care plans for decades.
Ask me if I give a shit how you do it over there.
They do it over there by taxing all who work at 48% then claim they are giving out free health care.
When Trump's Congress eliminates capital gains and estate taxes,
the stock markets will head to the moon, while the US economy
will head to the bankrupcy tribunals. That's what's really at stake.
O'Care and Fire & Fury, Iran and NFL are just 'shiney distractions'.
New American Royalty of Plutocrats is breaching, about to be born.
"If you want a vision of the future, imagine a $500 Manolo
Blahnik 5" stilletto heel stamping on a human face - forever."
Unfortunately, tax reform is dead on arrival.
"When Trump's Congress eliminates capital gains and estate taxes,
the stock markets will head to the moon, while the US economy
will head to the bankrupcy tribunals. "
yeah because the real problem in America is that taxes just aren't high enough. Just think how rich we'd be if we were all taxed at 100 percent!
If your friends jumped off a bridge, would you go in after them?
Appeal to Popularity is an example of a logical fallacy. A logical fallacy is using false logic to try to make a claim or argument. Appeal to popularity is making an argument that something is the right or correct thing to do because a lot of people agree with doing it. This type of fallacy is also called bandwagon.
You forgot the appeal to the 'Benefits of Liberty to Ourselves and
our Posterity', which is obviously another logical fallacy, as there
is no 'Liberty' ... unless you want to go live in a hobo tent camp.
All other industrial countries have both subsidized healthcare and
pensions for elderly. The USA has We Don't Care and Dog Kibble.
"which is obviously another logical fallacy"
Obvious to no-one but yourself. There is no such thing. You made that up. And it's wrong.
So lemme see if I got this straight.
You want us to give .gov the authority over our "health care" and over our retirement even though they've already proven they can't balance a fucking checkbook with the money they've already extracted or even take care of the few veterans in "their health care system" who they actually promised to take care of when they enlisted?
Is THAT what you're really think or do you work at the .gov VA or the Social Security Administration?
I do not want ANYTHING managed by the gubimint. Fuck you and fuck your socialist national health care.
I do not want ANYTHING managed by the gubimint. Fuck you and fuck your socialist national health care.
Most single pay systems have a parallel private market system. As single pay systems are forced to cut reimbursements, they depend more heavily on that private market system to pay the bills. Anytime there is a budget, there will be limitations on spending which in healthcare means rationing.
Anything enforced at a barell of a gun is bad. Why did they have to mandate it if it wsa such a great deal,huh? I'm so glad that cucksucker is not president and nor is the bitch. Say what u want about Trump but I'll take him any day even if he shoots somebody on 5th avenue. I-do-not-care.
i was saying this from day one about odumbocare, "if it was so good, why did you have to put a gun to ours heads to make it work for you?"
If Obamacare is so great why did Congress exempt themselves and their families from participation?
Because it didn't cover demonic possession and exorcism therapy.
They get chipped on their first day on the job with taser chips.
The Usual Suspects have the taser chip controllers, ha,ha,ha.
Haven't you ever seen Nancy Pelosi go shock zombie before?
Trump doesn't need the chip. He's already a trained poodle.
Are you real or just some nascent AI technology cut loose on the internet? Back to the drawing board with you!
If Congress Cunts and their demon spawn families had to eat the very same Dog Food they foist on Americans after being bribed and/or compromised, this country wouldn't be nearly as fucked up as it is now.
Congress is just a perfumed class of rubber stamps.
If single-payer government-run health care is so great why didn't McCain choose it for his brain tumor? He could have gone to the VA. He chose Mayo Clinic instead. Why?
He's a God, that's why! He should never have to use the same health care as mere mortals!
Well Trump just funded it for another 2 years. VERY SAD
funny your comment passed by these ZH folks. the RINOS made the deal with Democraps, then Orangeman changed his tune.
Trump is such a pathetic POS, bends to the slightest wind that floats his massive, yet unsupported by intellect, ego.
Has anyone who didn't know it already just found out that the one thing that liberals hate the most is liberty?
Nobody ever said that libturds were anything but malignant assholes.
What's not 'financially sustainable' is a $3/4 TRILLION
MIC WARFARE MACHINE WITHOUT OVERSIGHT OR LOSS-
PREVENTION, that has MIA'd $8,000,000,000,000, that's
enough to pay for Obama Care for 10 years. POOF!!
Even the f'king American livestock have free healthcare.
Article from one of those markets don't need regulation / open society / pro-anarchy organizations---like 2008 didn't happen. They seem to think that any government is too much government because it restrains the unfettered greed, suicidal and predatory instincts of "free" (to skrew the citizenry) markets.
Well said comrade! We must rule the proles for their own good, otherwise greed will run rampant! Ours will be a kind, benevolent dictatorship, and people will do as their told, or else, because we know better!
"Fear not", "quoth he, " for mighty dread had seized their troubled minds.
A new player has entered stage left.
https://youtu.be/qNoTjrgMUcs
The Don is exposing his horsepower. Nicely played!
And as for McCain's headache, perhaps he might want to catch up with Rick Simpson.
But then again, "Reefer Madness".
Hoist on your own petard, Congress Critters?
The short answer to this is no duh. But then the logic of insurance is to sell as much of it as possible to healthy young people who A) don't need it and B) don't have much money to spend on it in the first place. Meanwhile, the older and/or sicker people who represent the greatest demand for the product are faced with the highest prices for it, and all kinds of tricks to keep from having to pay out on them.
Obamacare and any other government-run or government-backed healthcare system will come into being because of a perceived market failure, analogous to a bottle of water costing more than a bottle of fine wine - and rightfully so - because demand for water is so much higher than demand for fine wine. The real problem here is that people are not willing to treat healthcare as any other product, where yeah, it'd be nice to have, but I don't really need it and in any case, I can't easily afford it, at least not without sacrificing things that Murray Rothbard says must be more important to me. An argument that nobody will challenge when it comes to luxury goods sounds frankly evil when it comes to people's lives.
I'm not sure what you're trying to say here, but health care really is no different from any other commodity. If health care is too important to leave to free markets, then why not have the government run other critical industries, like food, energy, or housing? The answer is simply that the experience is that governments ultimately fail at every attempt to run any industry, due to lack of critical feedback mechanisms.
Experience?
'Tis folly to rely too heavily on the Past for guidance.
Toffler is going to make you laugh and laugh.