Clinton v. Trump on ObamaCare Replacement – Part II

 

In Part I of this series, I discussed Hillary Clinton’s record on healthcare reform and her plans to reform ObamaCare. This post I will review Donald Trump’s plan for healthcare reform.

The Trump Plan

As a non-politician, Trump came to the healthcare debate in August, 2015 with the same erroneous ideas as Hillary Clinton. He favored single-payer healthcare systems like Canada and even extolled the virtues of healthcare in Scotland, where he recently acquired the famous Turnberry Golf Club and built another course near Aberdeen. He said, “As far as single payer, it works in Canada, it works incredibly well in Scotland.”

I called him out for his poor understanding of the failures of these healthcare systems in an earlier post (Trump Wrong on Single Payer Healthcare). I doubt Mr. Trump reads my blog but he apparently got the message, probably from close-advisor Dr. Ben Carson, that single-payer is a disaster. He has since changed his position.

When I attended the meeting of evangelicals with Trump in June, he made it clear it was his plan to repeal and replace ObamaCare. The obvious question then is what would a Trump healthcare replacement look like?

If you go to the Trump campaign website you’ll see the following bullet points:

  • Repeal and replace Obamacare with Health Savings Accounts (HSAs). 
  • Work with Congress to create a patient-centered health care system that promotes choice, quality, and affordability.
  • Work with states to establish high-risk pools to ensure access to coverage for individuals who have not maintained continuous coverage. 
  • Allow people to purchase insurance across state lines, in all 50 states, creating a dynamic market.
  • Maximize flexibility for states via block grants so that local leaders can design and innovative their Medicaid programs to more appropriately serve their low-income citizens.

 

Repeal and replace Obamacare with Health Savings Accounts (HSAs).

This is an important first step. Trump now understands that we must repeal and replace ObamaCare. It cannot be “fixed” since it is full of perverse incentives and government mandates that drive the cost of healthcare artificially higher than it needs to be. The only good thing about ObamaCare is it stimulated a debate on healthcare reform that has resulted in great ideas that can replace ObamaCare.

Work with Congress to create a patient-centered health care system that promotes choice, quality, and affordability

This is much too broadly stated to have much meaning but certainly we must promote more freedom of choice, quality and affordability. The key to this is tax-credits for everyone to purchase healthcare with the freedom to buy only what you need, not what the government mandates.

The amount of the tax credit must make it possible for even the poor to purchase adequate coverage and then those with higher incomes can add their own money to purchase better plans if they choose. This will guarantee that everyone can have health coverage at a price they can afford. By eliminating unnecessary coverage mandates the insurance companies will be able to lower prices. By providing these tax credits for everyone, the young and the old, poor and the rich, will all have incentives to purchase coverage thereby greatly improving the insurance pool risk and lowering the costs.

Work with states to establish high-risk pools to ensure access to coverage for individuals who have not maintained continuous coverage.

This is a good idea for those who fall through the cracks of the system. But the real solution to pre-existing medical conditions is to incentivize people to maintain their insurance coverage, even if they change jobs or if their health improves. To avoid people “gaming the system” you should charge regular rates for maintaining continuous coverage but higher rates if they allow their coverage to lapse for greater than three months.

Allow people to purchase insurance across state lines, in all 50 states, creating a dynamic market.

This sounds good but actually may have little impact on the prices insurance companies charge. Insurance industry analyst Robert Laszewski has criticized this idea in the past as a naïve proposal. Nevertheless, I see no down side to the idea.

Maximize flexibility for states via block grants so that local leaders can design and innovative their Medicaid programs to more appropriately serve their low-income citizens.

I’m all in favor of block grants to the states for Medicaid to encourage experimentation and innovation in Medicaid programs. This has been tried on a limited basis under the Obama administration with particular success in Indiana. More of these programs should be encouraged, but the best long-term solution is to eliminate Medicaid by allowing low-income Americans to purchase private health insurance with their tax-credits. That will stop treating the poor as “second-class” citizens by giving them “first-class” healthcare like everyone else.

The Trump campaign website is short on the specifics of ObamaCare replacement, but I’m convinced he will put forth a plan, with the help of the Republican Congress, that will greatly improve on ObamaCare. The ideas I have suggested above come from the Sessions-Cassidy plan recently developed by Republicans with the help of healthcare economist John C. Goodman (The GOP Solution to ObamaCare) (Sessions-Cassidy Healthcare Plan Solves Problems – Part I) Sessions-Cassidy Healthcare Plan Solves Problems – Part II).

The Clinton plan means socialized medicine. The Trump plan means freedom to choose an affordable healthcare plan that’s right for you. That’s a no-brainer decision.

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