Donald Trump

TrumpCare Will Be Better Than ObamaCare

But can it get past the infighting?

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Trump may be a disaster on trade, immigration, foreign policy, free speech, reproductive rights, civil liberties and numerous other issues. But there are some

Health Care Mess
DES Daughter via Foter.com / CC BY-NC-SA

areas where he might actually be an improvement over the status quo. One of them is health care — and Rep. Tom Price, his pick to head the Department of Health and Human Services, is a perfect indication of that, I note in my column at The Week.

As Peter Suderman has already pointed out, he is the only Republican who has worked out a detailed replacement plan for Obamacare and translated it into an actual bill called the Empowering Patients First Act. In broad-brush strokes, the bill will scrap the individual mandate and insurance subsidies to low income folks who don't qualify for Medicaid. And it'll replace them with universal tax credits for everyone not covered by their employers.

You can get the low-down on the plan in my column here.

It's a good plan, in my opinion, but it'll face a very rough road ahead.

Health care policy in America is enormously complex not because health care itself is inherently any more complex than other goods and services that markets do a fine job of providing. It is because after World War II America rigged the tax code to create a horrible, unwieldy, inefficient, and discriminatory system that is not easy to straighten out. Indeed, trying to work out something semi-rational by injecting the right incentives is awfully hard. Literally every reform produces winners and losers and involves trade offs that mobilize massive political opposition.

Hence it is inevitable that Price's plan would be attacked by liberals. Their big objection among many is that the plan's health care credits won't be as generous as the subsidies under ObamaCare. (That they will be universal doesn't somehow earn it too many brownie points.) And it deregulates the insurance industry too much, leaving patients, especially with pre-existing conditions, to its tender mercies.

But more surprising (though perhaps on reflection equally inevitable) is that the plan is also being attacked from the right. The Cato Institute's Michael Cannon, in fact, thinks it is not all that different from Obamacare. He believes that there is no meaningful difference between subsidies and refundable tax credits.

Furthermore, notes Cannon, the Price plan abolishes the individual mandate in name only. "If the penalty for not buying health insurance is that you lose a $2,000 tax credit, then that's not going to feel much different than paying a $2,000 tax penalty under Obamacare," he insists.

I actually do think there is a big moral difference between confiscating someone's money to make them do your bidding versus giving them money to make them do your bidding. (The real moral issue in the latter course is where that money is coming from? The government gets it from robbing Paul to pay Peter. But if the government is going to be robbing Paul anyway, then it's better that it does not rob Peter even more.)

Cannon favors replacing the current system with Health Care Savings accounts, which has a place in the Price plan but not a sufficiently big one, in his opinion.

Here's how Cannon sees it, as described in the New Jersey Star-Ledger:

Say your current employer pays $13,000 a year for your insurance. Now that $13,000 would go into a tax-free account you control. You could use perhaps $5,000 to buy a bare-bones catastrophic coverage policy. Then you can use the rest to either pay medical bills or to save for future expenses.

Imagine HSA's were in effect from the beginning for the 78 million baby boomers born between 1946 and 1964. As they now move into retirement, many would have tens of thousands set aside for health-care needs.

In other words, scrap the employer-based health care system and give HSAs to everyone. This would be awesome but also politically exceedingly difficult not only because liberals will throw a massive hissy fit but also because of the yuuuuge disruptions to people's current health care coverage in the interim. Replacing public schools (another disastrous government monopoly) with some limited educational vouchers is difficult. This will be a gazillion times more so.

Be that as it may, if you think the political conversation got heated over ObamaCare, wait for the fireworks on TrumpCare to begin. ObamaCare at least had the effect of uniting all its center-right opponents. TrumpCare will splinter them all with each jockeying to get its preferred version enacted.

How it'll all shake out is anybody's guess. But it'll sure be interesting.

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  1. Wait, Shikha Dalmia?

    Did they get to you?

    1. Did you fall asleep next to a supiciously-large pod recently?

    2. Look, you can’t sustain high levels of hysteria indefinitely. At some point you look around and realize the bills still need to be paid, the kids still need to be fed. So you buckle down and return to normal operations once you realize that shit isn’t actually going to fall apart like you thought it would.

      Look at the rest of the country – even the millennials with no jobs have packed up their tents because they’ve fallen out of the news cycle.

      Expect a new rash of ‘OMG TRUMP!’ stuff coming in late January though – not specifically from Dalmia but generally across the coasts.

  2. Did they force Shikha to stop using the baby Trump? Reason really wants some donations this year.

    1. I don’t know what that cartoon is trying to say, but it makes me uncomfortable on a level i can’t even really examine.

      1. It’s the next Warty Hugeman story cover.

      2. “Big hands I know you’re the one”

        1. +1 violent femmes

      3. I don’t know what that cartoon is trying to say, but it makes me uncomfortable on a level i can’t even really examine.

        I know, right? I had no idea Trump is a southpaw.

      4. It needs about fifteen labels.

      5. Maybe it’s some sort of ironic take on Trump’s tiny hands?

    2. Wasn’t Suderman the one spamming baby Trump images? Man that thing is annoying.

  3. “Trump may be a disaster on trade, immigration, foreign policy, free speech, reproductive rights, civil liberties and numerous other issues.”

    All that before he’s even been inaugurated?

    How can he be so awful on all those issues before he’s even done anything?

    Maybe you’re talking about what he said on the campaign trail?

    If Rand Paul had said all the exact same things–and been elected for it–I’d still have every hope that Paul would be every bit the libertarian we’ve been hoping for.

    Here’s to hoping that Donald Trump turns out to be something less than the monster Dalmia expects.

    He couldn’t hardly be any worse

    1. It’s called expectations management.

      1. Well, according to some Reason writers, managing expectations for a Trump presidency means getting ready for the camps and firing squads.

        I’ve also heard round these here parts that he’s going to force everyone to say Merry Christmas or else lose their citizenship.

        1. Finally !

    2. The same way that he was Hitler before the election, duh!

  4. “Ok Shikha, try to think of one positive thing to say about Trumpler or we will be forced to make you clean out the intern cages.” – Purple haired Goddess of Reason

    1. Ah, the sweet smell of despair, when your drive is shit compared to last one, and you’re flailing to correct…

      Don’t blame me, I donated!

      1. You fool, you didn’t get the memo. Hamster of Doom came up with a brilliant plan: no one donate until the last two days, then we open negotiations. Our demands will be met! Reason will negotiate with terrorists!

        1. Eh, I donated half the amount I usually do ($50 instead of $100) and explained why.

          And nah, they’ll ride the burning zeppelin rigid airship down first. Or get a “surprising” anonymous donation in last 12 hours.

          And the money is strictly because servers (even Reason servers) aren’t cheap and I use AdBlock in self-defense.

          1. Or get a “surprising” anonymous donation in last 12 hours.

            THE KOCHTOPUS LIVES.

            1. “This week in the history of economic illiteracy”

          2. Wait… you actually think that Reason is running this site on a server? Hah!

            1. It might be an original Pentium II with 16kb of RAM, but its still serving requests.

              1. Sometimes it’s serving requests. Often it’s serving squirrels and ignoring requests.

        2. Thanks for helping make them meet all of my demands. May this boycott end soon.

    2. That’s not such a bad task. They only feed the interns whatever scraps of fruit sushi Robby leaves behind, which is very scant pickings indeed.

      1. I heard in China, Robby’s hair has become something of a folk remedy to cure baldness. It’s twice as effective as tiger balls.

        1. Really? When’s Robby Season?

          1. Duck Season! – Bugs

          2. I’m not sure how Chinese seasons work. Season of the Cock?

      2. Dessert is clippings from Robbo’s hair mixed with ENB’s latest offering from one of her stalkers and a dash of Jacket lint?.

        1. Fool! There is no instrument on earth that is capable of cutting Dat Hurr, nor is there anyone who would want to.

          1. It’s like you’ve never heard of the Doomcock. IT CAN PIERCE SPACE AND TIME, SURELY IT CAN SURE CUT THE STRANDS OF AVALON.

            1. I said “on earth,” which the Doomcock seldom is.

          2. I’m pretty sure the only think strong enough to cut Dat Hurr is a strand of Dat Hurr itself. Which is a paradox that will one day destroy us all.

    3. *or whoever this site’s boss is, I’ze confuzed

      1. The correct answer is “The Squirrel Lord.”

  5. Wow, I think it might just be the case that Shikha managed to not hyperventilate and pass out several times in the course of writing a Trump related article.

    1. Still managed to say that Michael Cannon, who has far more libertarian street cred than she does, “on the right.”

      1. Of course he’s on the ‘right’. There was a ‘libertarian’ candidate in NH running on the platform of single-payer healthcare. Libertarian moment! All of the cocktail parties and none of that icky liberty stuff

  6. And they say we don’t read the articles.

  7. I’m getting really sick of all the pro-Trump articles around here by Shikha Dalmia.

    1. Touche.

  8. I just came here to find out if Trump was going to be disaster on trade, immigration, foreign policy, free speech, reproductive rights, civil liberties and numerous other issues.

    THANK GOD it was all covered in the first sentence so I don’t have to read any further.

    1. No Trump for you!– Shikhasoup Nazi

  9. I don’t think there is any conceivable “plan” out there that will live up to Americans’ expectations unless it dramatically lowers costs. We’ve been conditioned for decades to expect health care that falls out of the sky and delivers equal outcomes to everybody. Anything that makes people pay out of their pocket and doesn’t guarantee to have them doing cartwheels at ninety years old is going to disappoint.

    1. Yet paradoxically expectations have never been lower.

      1. Wait, are you talking about American health insurance legislation, or Dalmia articles?

        1. Equally applicable. I’ll let you decide.

    2. Anything that makes people pay out of their pocket and doesn’t guarantee to have them doing cartwheels at ninety years old is going to disappoint.

      Check out Mr. Naysayer over here.

      1. It’s actually much worse than he lets on since most of those people can’t even do a cartwheel now.

    3. Only technology and the government getting out of the way can make healthcare better.

      1. We need Bitcoin for healthcare… Bitcare

    4. Thanksgiving sucked this year. Usually I can just swallow my tongue, and say,”Okay, mom…”

      But, Obamacare came up.

      I tried my first argument- I’m only going to earn about $3 million in my lifetime- I’m 52- why do I need, or even expect, health insurance with no lifetime limits? Can I be allowed to buy a policy with a $6 million limit? (my policy before PPACA).

      “You shouldn’t have to make that choice.”

      But, I knowingly and willingly made exactly that choice when I bought that policy in 2007.

      “See!- This is better for you!”

      That policy was $1800/yr- the cheapest now is over $5K/yr

      “But, it’s a better deal for you!”

      No, it’s not. I had a health ins. policy I was willing to pay for in 2007, I am now uninsured.

      “You just hate Obama!”

      No, I hate that I have to buy a policy that covers pediatric dental services for the children I never had, the $30K coverage for addiction rehab that I don’t want, and the yearly “free” (AKA pre-paid in my premium) colonoscopy and physical- when my last annual physical was as a 14 yr old trying to get a “work permit”.

      “See!! It’s better for you!

      OK, mom… (pour another vodka tonic that’s 90% vodka)

      /scene

  10. Good article. I am a health care consultant and spent the last two weeks writing a paper on Trumpcare. I have come to many of the same conclusions as Shikha concerning the improvement of the probable Republican plan over the ACA, but I am much more optimistic about its chances for becoming law.

  11. Why can’t the government decide what health care costs on average per person per year and give every taxpayer a tax credit for that amount? In other words, cut taxes for everyone about $10,000.

    1. That’s Cannon’s plan in essence.

  12. But basically – if your tax bill is low then fuck you?

  13. And we need to replace Obamacare with another plan because . . . ?

    Repeal the sucker and return to less complicated non-taxable free market insurance.

    Get the stupid government bureaucrats out of our everyday lives.

    That would work except for Trump’s socialistic tendencies such as we see with the bogus Carrier deal. Ivanka wants taxpayers to pay for maternity leave, so we will through a government program! Income redistribution is a great concept except for the very rich, don’t-cha-know?

    1. We can’t return to non taxable free market insurance because we haven’t had that before. That’s why we need more that just a repeal, we need a law under which employer tax exemptions are extended to individual private insurance. Extending the HSA this way would be the easiest solution.

  14. disruptions to people’s current health care coverage in the interim.

    I don’t understand how setting up mass HSAs would necessarily be disruptive.

    Basically, require the companies to deposit the Employer portion of the premium in an HSA. Then give the employee the option to buy a plan from that employer (or any other health insurance provider out there). It is noteworthy that most big employers out there don’t actually sell you (e.g.) Cigna or Aetna health insurance. Most of them are providing THEIR OWN insurance to you, and the network, paperwork, etc are all managed by Cigna, Aetna or whomever. In other words the employer is setting aside a large insurance fund for all the employees and a portion of that fund goes towards Cigna for claim processing, provider network management, etc.

    HSAs are the best way to reduce the complexity of the system. It won’t change overnight. There will be years of transition as Employers stop offering those plans if and when a free market of insurers takes off. I have been living off an HSA for 5 years or so, and my family (Wife + 3 kids) have accumulated a small nest egg of around $15,000 which is based on us maxing our contribution to the account net of our various health expenses over that time. It makes a decent return in the market, as well.

    1. Additionally, setting up mass HSAs would make welfare far more transparent and easy. When you file your income tax return, if you fall below a certain income level, the government deposits a subsidy in your HSA.

      Obviously I would rather not have any welfare. However, if we are going to write the checks, it is better to have a check made out directly to the needy person than pass it through various administrators and programs that take their cut and have their own (often contradictory) incentives.

  15. The cartoon seems to come from here ? http://ibbycaputo.com/print/ ? “Probing Doctors’ Ties to Industry”. Still makes no sense. Something about “clean hands” metaphorically?

  16. Trump may be a disaster on trade, immigration, foreign policy, free speech, reproductive rights, civil liberties and numerous other issues

    Even better, he may very well not be a disaster at all.

  17. testing, testing.

  18. Who said comments were disabled here?

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