But what would you replace Obamacare with?

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Pre-ACA/Obamacare protest in DC, 2009. (Via Wikipedia)
Pre-ACA/Obamacare protest in DC, 2009. (Via Wikipedia)

WASHINGTON, August 22, 2014 − For opponents of the campaign to repeal and replace the Affordable Care Act, otherwise known as Obamacare, the question is always “What are you going to replace ACA with?” The answers never seem clear. But there is a simple solution that remedies the problem in both the short term and the long term. What is it?

First off, regardless of the rhetoric, Obamacare is not a success story. Rather, it is a complete failure. Proponents claim it is successful because 8 million previously uninsured people are now insured. While that may be true, this 8 million figure represents less than 20% of the previously uninsured total, leaving more than 35 million Americans currently uninsured. Even long time ACA proponents admit up to 30 million individuals may still be uninsured. This alone marks a clear failure to achieve this law’s stated goal to “insure all Americans.”

The ACA is also a failure because it has not reduced costs for the middle class. Instead of the promised $2,500 annual premium reductions, costs have increased for the majority of Americans. They have seen policy premiums skyrocket and deductibles dramatically increase. For the small percentage of Americans that enjoy lower premiums, it’s because we the taxpayers are picking up the tab. So average Americans now pay more for their healthcare and pay more taxes to cover those government subsidies for everyone else.

Virtually every doctor that I have spoken with says this law is a disaster. Many want to retire early and they discourage their children from entering the medical profession.


So what should be offered as a replacement?

ACA supporters often ask, “Do you want to go back to what we had?” The answer should actually be yes, with some modifications. Prior to Obamacare, surveys indicated that up to 90% of Americans were generally happy with their health care plan, although cost was always an issue. So the simplest solution is to return to what we had before the current unpopular law was passed, with the exception that we remove pre-existing condition clauses and perhaps consider at what age a child can remain on her parent’s plan. We can also expand Medicaid to cover more of the uninsured.

In addition we can allow insurers to be more competitive by removing limits regarding where they can sell their policies. Health savings accounts can also be expanded to help reduce cost. This can be done relatively quickly and provides a short term solution.

In the long term, there is a better solution. Essentially the problem with health care is that the price is too high (and continues to increase) and there are not enough reasonably priced health services available to Americans who need them. In other words, the price is too high and the quantity too low. This is a simple problem to solve.

If we look at the health care services market and view it as we would any other market, we would solve this problem by taking action to increase the supply. In other words, suppose we had a relative shortage of beef. The price would rise and there would not be enough beef to meet consumer demand. The high price and the resulting high profit would encourage existing beef ranchers to expand their output as well as encourage new ranchers to enter the market. This would increase the supply which would cause the price to fall. The increased supply means that there is now more beef available to the market, thus relieving the shortage.

Similarly in the market for health care services, we should move to vastly increase the supply of doctors and other medical professionals, by expanding the number of medical schools and other facilities that education health care professionals. This increase in supply would add competition to the market which results in lower prices, improvements in quality and the elimination of the shortage. While this may be costly and would take five to ten years to become fully implemented, the cost of doing so would be a fraction of Obamacare, a program that is already more than four years old and still not fully implemented.

Then we continue to expand Medicaid to cover the uninsured. We may even consider a plan that will pay students’ entire cost of attending medical school if they work for four years after graduation in a government clinic geared to provide health care services to those who can’t afford them.

I find it surprising that when dealing with the market for health care services, policy makers seem to forget the basic laws of economics. If we look at this market as we would any other, the solution may actually be surprisingly simple.

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  • Llowengrin

    This is a very funny article! Increasing the supply of medical professionals was tried decades ago and what was found was with every MD entering the marketplace, costs rose. They generate their own demand.

    The idea of paying back one’s education was tried during the Carter years with the National Health Service Corps. Many of the MD’s involved found ways to avoid the payback duty and the program became a target of the right.

    Healthcare just isn’t like any other market. If you are dying of heart disease, you are in no position to challenge your cardiologist about the wisdom of using a more expensive “brand” vs a “generic” heart valve. If the OB says to the labor team “C-section NOW!” what is the laboring mother or father going to do? Ask why we’re spending the money?

    The right is furious at the idea that healthcare might become a “federal entitlement”. But that is exactly what Ronald Regan created with EMTALA in the 1980’s by requiring emergency rooms all across America to serve all customers. It’s unfunded mandate to provide the most expensive and least proactive service imaginable in healthcare today. A diabetic who can’t afford insulin or proper foot care can come into any ER in America with gangrene and get a state of the art amputation. What kind of entitlement is that?

  • howiem

    “…policy makers seem to forget the basic laws of economics.”
    Are there any policy makers who know the basic laws of economics?

  • Cade Yaeger

    Compassion? Always remember that Kathleen Sebelius refused to approve a waiver that would have put a dying child on a lung transplant list.

  • jeffwarren2

    “Instead of the promised $2,500 annual premium reductions, costs have increased for the majority of Americans.”

    Anytime I see this BoldFaced, Pants on Fire Lie used to bash ObamaCare, I immediately disregard anything the basher has to say. TeaBaggers who use this line are probably the types who LIE almost everyday to their spouses and children.
    The fact is this line wasn’t about the 2010 ObamaCare act from some speech that PRESIDENT Obama made. It was about a healthcare reform goal that CANDIDATE Obama made during the 2008 campaign. So it was a broken campaign promise. I know GOP Prez have NEVER done that, EVER.

  • Leroy Jons

    I will show what this Administration is all about. Please read this carefully and understand that this is what this Administration wants the American people and voters to do. Just vote yes to this Administration’s total lack of responsibility and waste of billions of dollars on the Obamacare that does not work still and is bleeding tax payers dry. In remarks at the 2010 Legislative Conference for the National
    Association of Counties, House Speaker Nancy Pelosi said, “But we have
    to pass the bill so that you can find out what is in it, away from the
    fog of controversy.” This is exemplary of this administration and what the likes of Nancy Pelosi stand for. SHE STILL HAS A JOB. PUBLIC SECTOR BUSINESS WOULD HAVE FIRED HER IMMEDIATELY WITHOUT RETIREMENT. WHY IS SHE STILL IN OFFICE? SHE HAS CLEARLY STATED I AM NOT DOING MY JOB BUT I LOVE MY INCOME AND RETIREMENT FUNDING FROM TAX PAYERS. I COULD NOT EVEN GET SUBSIDIZED IN MISSOURI WHEN I ENTERED TWO ADULTS 64 YEARS OLD IN A HOUSEHOLD OF 2 WITH A TOTAL GROSS INCOME OF $1,000.00 DOLLARS. YES YES YES. A TOTAL INCOME OF ONE THOUSAND DOLLARS EVEN. WHAT A JOKE AND SO MUCH FOR HELPING THE POOR. GO TO HEALTHCARE.GOV AND PROVE IT FOR YOURSELF AND ENTER THIS INFORMATION.