The Jury Talks Back

7/31/2017

The Cruz Solution to the Pre-Existing Condition Problem: Individual Responsibility

Filed under: Uncategorized — Patterico @ 7:30 am

Everything about ObamaCare flows from one principle: that companies can’t deny coverage to people with pre-existing conditions. It’s an overwhelmingly popular concept. But is ObamaCare’s way of addressing the problem the best way? The answer is clearly no. There is a better way: one consistent with individual responsibility. I call it the Cruz solution.

Before we get to the Cruz solution, let’s talk about what we have instead: the ObamaCare solution. The ObamaCare solution is to tell insurers they must cover people with pre-existing conditions. Period. The message that the ordinary person hears is: “Go ahead and wait until you are sick to buy health insurance.”

This concept has been a disaster that has caused premiums to skyrocket, wreaking havoc all over the country. The media ignores the human cost of this ongoing disaster, of course . . . but you can read about it elsewhere.

For example, The Federalist recently had a piece that told the all-too-typical story of a man named Joe Cato, whose insurance won’t pay for back surgery, but will pay for opioids. Joe used to pay $36 a month to Aetna for insurance that “paid for CT scans, an MRI, nine spinal injections, visits to the emergency room, physical therapy, chiropractic care, and massage specialists.” But the costs resulting from ObamaCare drove Aetna out of the individual market, and Joe was left with one choice: a $120 per month Blue Cross plan that won’t pay for the surgery Joe was about to have with his Aetna plan. John Daniel Davidson, the author of the piece, explains that this is all a result of ObamaCare’s way of handling the pre-existing conditions problem:

Joe’s story illustrates in a microcosm what’s been happening all over the country. Obamacare sought to transform the individual health insurance market by making two major changes: 1) forcing everyone to purchase coverage—the individual mandate provision—and 2) forcing insurance companies to cover everyone, even those with preexisting conditions. The idea was that the young and healthy would sign up, and their premiums would pay for the cost of older and sicker people, whose premiums wouldn’t actually cover the cost of their care.

It hasn’t worked out that way. Young people didn’t sign up for coverage on the exchanges in sufficient numbers, opting instead to pay the penalty. Insurers were forced either to raise premiums, which have skyrocketed in recent years, or simply exit the market in the face of huge financial losses.

This year, insurers fleeing the market left 21 percent of all Obamacare exchange customers with only one insurer in their area—including Joe Cato in North Carolina. Next year it might be even worse, with as many as 1,200 counties projected to have only one insurer and 47 counties with no Obamacare insurers at all.

That matters because of people like Joe, who are left with no choices and inferior coverage that won’t pay for necessary procedures—but will pay for opioids. That’s especially callous, given the ongoing opioid crisis.

The ObamaCare solution is what caused Joe Cato’s premiums to skyrocket, while his options for care dwindled to nothing. It’s the solution that says: don’t worry. You’ll be covered whether you bother to buy health insurance or not. We may give you a little penalty. We’ll send our grinning fool of a President out on the talk show circuit to persuade you to buy health insurance. But in the end, thanks to him, you don’t really need it. We’ll make sure you’re taken care of, whether you act responsibly or not.

There is another solution, which I call the “Cruz solution”: lawmakers could craft proposals that ensure that people who are responsible and obtain insurance should not have it taken away because they develop a serious health condition. I call it the “Cruz solution” because Ted Cruz explained it in his March 2017 piece The Right Way to Repeal ObamaCare:

[W]e should protect continuous coverage. If you have coverage, and you get sick or injured, your health insurance company shouldn’t be able to cancel your policy or jack up your premiums. That’s the whole point of health insurance.

The Cruz solution is a logical approach. The Cruz solution says: if you want coverage when you get sick, you have to buy insurance when you’re not. That way, you have it when you need it — and we won’t let insurance companies play tricks on you and snatch it away from you even though you kept your end of the bargain. If you get hit hard by circumstances, we’ll work with you. There will always be charity care, mandatory treatment in an emergency, and Medicaid under current law. But this may not be ideal. If you want proper treatment, ultimately, it’s your responsibility. You need health insurance when you’re not sick — because we’re not going to suddenly let you buy it for the first time when you are.

In the end, we do have to have some solution to the pre-existing condition issue. Most people I know, including me and the members of my conservative family, agree that the state of affairs before ObamaCare was unacceptable. The individual market has been broken for as long as I can remember. And health insurance through one’s job carried the ever-present threat that you could lose your job — meaning you would lose your policy, and another insurer could come along and deny you health insurance if you had developed a health condition in the meantime.

But if you don’t want government completely running health care through single-payer — a totalitarian state of affairs that leads to Charlie Gard situations where the overwhelming power of the state trumps family when it comes to health care decisions — then the solution to this problem requires insurance companies to stay afloat. This means enough people must buy insurance for insurers to stay in business. There ain’t no such thing as a free lunch. Insurers have to be paid or insurance will disappear.

The question is: will the solution to this problem be one tied to individual responsibility, or one that puts the responsibility on government?

The ObamaCare solution isn’t working. Just ask Joe Cato.

Why not give the Cruz solution a try?

[Cross-posted at RedState.]

4 Comments »

  1. I don’t see how the “Cruz solution” addresses the freeloader problem.

    Many young people (rightly or wrongly) believe they don’t need health insurance at all except in the rare case when they need emergency treatment (for, say, a broken leg). And they know they cannot be turned away at an ER, and the hospital will simply defray its expenses by inflating the costs to paying “customers”.

    For these young people, that is their health plan — doing nothing, paying nothing, and hoping they don’t break any limbs. They are not showing a lack of “individual responsibility”; they are merely reaching a solution after performing a cost/benefit analysis.

    I understand the objection to the mandate, but the “Cruz solution” seems to rely on wishful thinking that people will be “responsible” and sign up. I suspect you would get less young and healthy people in the markets under the Cruz solution.

    Comment by Kman — 7/31/2017 @ 8:54 am

  2. Some may see value in a low premium catastrophic policy.

    Comment by DRJ — 7/31/2017 @ 1:24 pm

  3. I agree with the Cruz solution in the main, but, what about the millions of people who already have a preexisting condition AND lost their policies (that they’d responsibly maintained for over a decade in my case) thanks to Obamacare and the intentional lie that “if you like your plan, you can keep your plan?”

    Any chance of a one-time exemption; if you were doing the responsible thing before a Obamacare terminated your policy, you can buy a similar policy without the preexisti8ng condition weighing against you.

    Comment by Arizona CJ — 7/31/2017 @ 6:57 pm

  4. Healthcare policy, in my opinion, boils down to serving either those who choose to earn access or those who refuse that burden.

    Those who truly can’t work can be covered without blowing up the system. However, adding in those who won’t work, will.

    I hope to live long enough to break out the popcorn when the poor scream about the disparate impact the death panels have on them.

    Comment by Ed from SFV — 7/31/2017 @ 10:36 pm

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