The state of the medical insurance industry in our nation, as it exists right now, seems to make no one in Washington, D.C. happy.
Why can’t they find some middle ground? Well, mostly because the premises of each side are incompatible with those of the other, so there is little common ground on which they can stand to reach an understanding, in spite of the fact that every other advanced industrialized nation, as diverse as Switzerland, Germany, Canada, Singapore, and Japan, has found a way.
Put in simple terms, here is the financial health insurance landscape: there is a large portion of the population who have personal or workplace resources, who can and are willing to pay for premiums. They are profitable for private insurers.
A second group, outside the workplace, is at high risk for health care costs to exceed personal incomes because of age, subsistence income, or health status. The Federal government has stepped in for some of this group to aid them in securing health care, through Medicare, Medicaid, the Veterans’ Administration, the Childrens’ Health Insurance Program (CHIP), and family clinics. These are the entitlements frequently targeted in political budget debates.
And there is a third group, whose income level, and whose health risk, very high or very low, makes it prohibitive or unattractive to have health insurance.
Ten years ago, well over 30 million citizens fell into this group: young folks, less likely to become ill, chose not to be insured; young folks living with their parents were not able to afford coverage; people with pre-existing illnesses were turned down for insurance; and others -- many others – had incomes that simply would not permit the purchase of insurance without destroying substantially the quality of the lives of their families.
Neither political camp was content with the status quo. The liberal wing opted for the moral high ground, finding that allowing tens of thousands of Americans to die because health care was not affordable to them was unconscionable, advocating for the use of public funds to cover that 30 million fellow citizens then uncovered. They proposed universal coverage, such as Medicare for all, or a public option, for those who found private insurance beyond financial reach.
The conservative wing resisted the use of public funds to help, content with the private insurance infrastructure being the vehicle for financing health, relying on the private sector’s ability to create jobs for income to purchase insurance. If folks found insurance beyond their ability to pay, in was the natural order of things. Keeping the private marketplace free from government involvement was primary.
When Obama was elected president, he found a democrat controlled Congress receptive to doing something about the uninsured and the overloaded emergency rooms that the uninsured utilized to access medical care.
He adopted a model derived from one championed by Mitt Romney as governor of Massachusetts, using private insurers as the vehicle to deliver the services. The Affordable Care Act (ACA) allowed young people to stay on their parents’ insurance policies. It prohibited insurance companies from turning away people with pre-existing illnesses. It set standards of coverage so insurers couldn’t sell “trash” policies with severe, often hidden, limits.
When insurers complained that those requirements denied them needed revenues to cover these sicker people, Obama included subsidies for low and moderate income people, and imposed fines for young low risk young people who might choose not to be insured.
The upshot is that tens of millions of Americans, once walled off from the security of solid private insurance policies, now are covered. And the provisions of the ACA are tightly woven, so that the overturning of one provision can result in disastrous effects on others. For example, to repeal the mandate will result in a substantial shortfall in revenues insurers need to cover low income working folks.
The general public is warming up to the impact of the ACA. Suggesting tax breaks for the wealthy in hopes that jobs will afford health care, all at the expense of health care for folks now reassured by ACA, is falling on increasingly deaf ears.
Health care in the U.S. is still a patchwork, but according to the Pew Research Center, more and more citizens are feeling comfortable with the Affordable Care Act, just as they became comfortable with Medicare. And the wholesale repeal of the ACA could have far reaching political ramifications both for the health care and health insurance industries, as well as the general public.