Obama’s health care initiative is in trouble. Leftists are unwilling to support any proposal that does not include a government option, and moderate Democrats are backing away from any proposal that does. In his search for some sort of middle ground, the President will likely repackage the public (government) option as a co-op or partnership. Others will be calling for compromise legislation, as if a united Democrat party needs any Republican help. To those on the left, however, compromise means one big step toward socialized medicine instead of two. Olympia Snowe’s so-called public option trigger is an example of the type of compromise we should reject.
But there are some practical ways conservatives seeking market-oriented improvements can work with those on the left. Changing the IRS code to replace deductions for employer-provided health insurance with a personal deduction would enable Americans to enjoy the same tax benefits when they obtain their own coverage. Allowing individuals to purchase coverage across state lines would make markets more competitive. Tort reform would put a lid on some of the frivolous lawsuits that surround medical practice. Clarifying the fourteenth amendment so that children of non-Americans born in U.S. hospitals do not automatically receive citizenship (and government benefits) would play a role as well, as would deporting illegals who can’t pay their medical bills.
What should we be willing to give up in a compromise deal? Government already plays a big role in our health care system, and this is unlikely to change. One possibility is to remake part of the government function without expanding its reach. I proposed my own compromise alternative in March to address the need for basic care for those who can’t get coverage or don’t want to pay for it. Current low-income programs (Medicaid, SCHIP, etc.) would be scrapped and those without coverage would pay a fixed percentage of their income for a basic, no-frills plan funded by government but administered by private insurance companies. Participant contributions would be matched dollar for dollar from the general fund. Deductibles would be high and coverage limited because the pool of funds could not increase unless those paying into the system paid a higher percentage of their income, which would create an incentive for those making the most money to get private coverage. The idea was to create a barebones plan that makes basic coverage available to the limited number of Americans who fall through the cracks AND requires those filling up the emergency rooms to pay into the system. It was also designed with an internal mechanism that would keep the plan small so private insurance could flourish.
Another possibility is to provide universal (very) high deductible coverage to every American, perhaps kicking in after anyone spends more than $15,000 on basic healthcare expenses in a given year. Such a proposal would not be too costly and would not require massive overhead to manage because only a small percentage of Americans (not including those in Medicare) would need to make a claim in any given year. The benefits could be substantial:
1. Americans with preexisting conditions would have a ceiling on their annual expenses. Granted, $15,000 is still a lot to pay, but it provides a safety net at some level.
2. Insurance companies would be more likely to insure those without preexisting conditions because they would not be responsible for reimbursing basic care beyond the $15,000 level.
3. Premiums would fall because insurance companies could be reimbursed for catastrophic care, all Americans would be paying into the system, and the amount of unpaid medical bills providers written off by providers would fall.
4. Americans who save their own funds (perhaps through medical savings accounts) could forego insurance altogether if they wish, knowing that a major illness wouldn’t wipe them out if they had adequate reserves to cover the $15,000 deductible.
If you’re skeptical, remember that we’re talking about a compromise here, a move in the right direction. Both proposals would provide some sort of coverage to ALL AMERICANS (something the Democrats’ proposal won’t do) while providing an incentive for Americans to get insurance in the private sector. Couple this with some of the earlier reforms I mentioned and you might have a package worth considering.
Perhaps the biggest advantage of this type of compromise is that it meets the left’s stated concern-ACCESS for all Americans–without meeting its real concern, ENTITLEMENT. Democrats who refuse to support such a deal will be forced to acknowledge their real position, that some Americans should accept financial responsibility for the healthcare of others, and that a government-run plan is the solution. These are not winning arguments with most voters.
The truth is that this type of compromise won’t be good enough for the majority of Democrats who are fixated on complete government control of the system. In the mean time, we must watch out for so-called compromises that increase the role of government. We’re starting to win the battle. Now’s not the time to quit fighting.