The Myth of ObamaCare

9e43bfde477f6bdac2ace3cc993dd3c4.jpg

With the repeal of Obamacare by the Congress yesterday the Democrats are now pushing a new message. 24 million Americans have lost their health insurance due to Republicans. I have no idea where they got that number from but it ignores the main issues surrounding Obamacare. The number of insured is not the only metric to judge insurance by. For most people the quality of the insurance matters more.

Obamacare

Any discussion on insurance has to begin with Obamacare. Obamacare essentially made a very small set of the population very happy and a larger set angry because it did two things. First off it made the people who had pre existing conditions very happy as it allowed them to purchase health insurance for the first time. Second it made the rest of the people angry as it screwed up their health insurance. This is not surprising as the sicker costumer base made the risk pool worse.

If there is one thing that Obamacare consistently did is that it constantly increased the Premiums and deductibles of the plans under it. Year after year these went up which is why Democrats lost so much ground in the government. This then begs the question. If the insurance you is so bad can you really be said to have insurance? Does quality matter? The purpose of insurance is to provide quality healthcare. If you have “insurance” with deductibles so high that they never help in making your payments for health services do you really have insurance? Or do you have a piece of paper with the word insurance on it costing you more and more money in premiums every month?

What Democrats do not want to tell you is that insurance had gotten so bad under Obamacare that people who were paying for insurance could not use it. I am not even going to go into the fact that doctor choice was more severely limited under Obamacare as well. There was no indication that this was going to get any better. The Democrats say 24 million people would lose their health insurance. You cannot lose something that was already taken away from you.

TrumpCare

I am not a fan of Trumpcare. I have already stated in the past that my primary requirement for a healthcare bill is price controls on drugs. Every other first world country follows their national interest and puts price controls on their drugs. The US citizen is left behind as he is fleeced to pay for the research costs of new drugs.

That said Trumpcare is better than Obamacare. At the very least it represents a chance to fix the healthcare system that the Democrats broke. There is one fact that Sanders, Clinton, or Obama will never mention. Under Obamacare the insurance companies have increased their profits by more than 200%. Let this sink in. They are required to cover a sicker pool of people. They increase premiums and deductibles by saying they are unprofitable. Yet they have increased their profits by 200%.

It is not difficult to imagine why. If the government holds a gun to the head of the citizens and says they must buy your product or suffer the consequences, and then compounds this by saying that you are the only one they can buy insurance from, then it becomes very easy to make money. You can offer whatever crap you want and call it service and people will be forced to buy it. Removing the individual mandate and forcing the companies to compete may actually improve services for everyone. The insurance companies may even be forced to lower profits.

At the end of the day Obamacare is failing already. We may as well find an alternative solution while we still have time.

Trumpcare is Better than Obamacare

images

I wanted to wait for some time before giving my reaction to Trumpcare so I can take a look at the actual proposals instead of making a knee jerk reaction. The truth is that Trumpcare is better than Obamacare. Unfortunately it is not that much better than Obamacare so I cannot support it. It does do away with the worst portion of Obamacare but it does not fix the main issues causing our healthcare costs to rise. There is little point to replacing a flawed system with a slightly less flawed system. It would be better to just let Obamacare implode.

The Good

Rising Uninsured 

Believe it or not this is a good thing. The main problem with Obamacare was that it forced everyone to get insurance. You did not have to want it or find it particularly useful but you were forced to get it. This meant that the insurance companies, many of whom had a monopoly in their individual markets, could offer you whatever it wanted and you would be forced to purchase it. It was your tough luck if the product they offered had a deductible that was too high or doctors you did not want to visit. In a regular market the consumer would be able to correct this behavior by the company, by refusing to buy the product. Under Obamacare if you did not care for the product offered Obama would hit you with his tax or penalty until you gave in and purchased the inferior product.

Trumpcare gives the power of choice back to the consumer. If the product is terrible then you can refuse to purchase it. The insurance companies will have to offer a better product to get these consumers to purchase it again instead of having a literal captive market. It turns out that if you actually offer people a choice some of them may opt not to purchase insurance and this is a perfectly valid and rational choice depending on what the product actually offered is. Theoretically you could mandate one insurance company to have a monopoly and provide insurance to everyone in the US. They would be worse than Obamacare plans with deductibles of 200k and one doctor available in the middle of nowhere but they would cover everyone with insurance they can’t use. Quality of insurance matters as well.  As a general rule the life expectancy in the US goes up every year since the 1980’s. In 2016, under Obamacare, the life expectancy dropped.

The only people who would lose insurance under Trumpcare are those who did not want insurance in the first place. They are those who were only forced to buy substandard insurance by the gun the government pointed to their head. It is important to note that the provisions that allowed previously uninsurable people to get insurance are still there. If they want to continue their older plans they still can. The rest should get better plans as the insurance companies are forced to compete with each other.

Age vs Income

ANother important change is that subsidies are now based on age and not on income. All things being equal the younger person will have a lower premium than the older person. The younger one tends to be healthier and use insurance less than the older one so the insurance company charges a lower price for them. Restructuring the subsidies means that they reach the older people who would need them more. The younger ones who pay less will get lower subsidies and if they still needed more help they would most likely qualify for medicaid, medicare, or some other program.

The Bad

While Trumpcare does force companies to compete for their customers it still does not solve the structural issues which raise the cost of healthcare. Earlier on I wrote another article on the alt right view for Obamacare. I understand we will not be getting everything on the wish list as we are just one component of the Trump coalition. At a bare minimum I would expect there to be price controls for drugs or price transparency between hospitals for any bills to get our support.

Price Controls

Americans pay ten times more than other countries for their medicines. Drugs make up around 10-20% of total medical costs. Pharmaceutical companies have gone on the record and said that they need to charge Americans this outrageous amount to make up for the costs of developing new drugs. There is no reason why American citizens should bear this cost alone. The whole world benefits from new drugs and other countries must step up and bear their portion of the cost.

I understand if it is too difficult to set a whole set of prices out of the blue therefore we can include a standard set on the average of other countries. For example the price of a certain drug x cannot exceed the average of the selling price of the drug in Britain, France, Germany, and Japan. If the government is able to negotiate lower prices then great but at the very least Trumpcare would set a ceiling.

Hospital Price Transparency 

Everything gets cheaper with more competition. We want the insurance companies to compete with each other to lower prices. We want to remove the monopoly of drug companies in the country and get prices for medicine from the rest of the world. Hospital care and procedures would be the next price point that can be lowered with competition.

As things stand it is next to impossible to get a quotation from a hospital for procedures done. Most, if not all, hospitals will not even give you a list in their websites of what they charge per procedure. You usually only find one right before or right after the things are done to you. How can competition exist when customers are not aware of the price of the items? As part of Trumpcare we would like to see a requirement where hospitals are forced to list their base prices in their websites and give quotations upon request.

Reducing the cost of healthcare is not limited to insurance. We can actually reduce the cost of the components of healthcare. Either or preferably both of these in Trumpcare would lower the bill for everyone.

The Alt-Right View: Obamacare

f6c25eb832d1136224d2cc5233a654f4.jpg

For my second article in my series introducing the positions of the Alt-right. I will discuss Obamacare and healthcare in general. Since the Alt-right is less moored in conservative or progressive ideology and instead looks at things from a nationalist point of view we do have more freedom to look at things objectively.

Like anything else there are good parts to the law and bad parts. To sum it up in one paragraph the positive  is that the sickest part of our population can now be insured. The negative is that premiums are rising for everyone else. It has also proved to be unsustainable as insurance carriers are dropping out of the markets at a rapid rate. We do support President Trump’s call for a repeal and replace of Obamacare as it is obvious to even its most ardent supporters that it cannot continue as it is. We have a set of proposals that I will outline below. By having an America first mindset instead of one that puts global interests before national ones we believe the system can function.

Individual Mandate

We do agree with the conservatives members of our coalition in the GOP that the individual mandate must go. People should have the freedom to choose whether they get insurance or not just like they have the freedom to pick and choose whether they get any other service. We do want to highlight personal responsibility. Since people have the choice not to get insurance then they must also accept the consequences of not having insurance. Emergency rooms and other areas must not give healthcare to those without insurance or other means to pay. It does sound draconian but we are providing an affordable means for everyone to be insured so there is no reason not to be. It would also help with illegal immigration as they would be denied healthcare.

We do realize that the individual mandate is important for the risk pools to remain healthy but we believe other measure we outline can solve that.

Drug Price Controls

In 2015 prescription drugs represented 10% of all healthcare related costs. According to pharmacutecal companies  they recoup the costs for researching new drugs here which is why they can survive even if other first world markets have put up price controls. The Alt-right believes that there should be no legitimate reason for America to bear the brunt of the cost of new drugs for the world’s benefit. The costs should be shared.

We do take a break here from the conservatives in our coalition as we are outright calling for more regulation. We believe it is necessary in this case. By putting price controls on their drugs Britain, Canada, and other countries are harming American citizens as we are forced to pay more to compensate. In cases like this the government is necessary to ensure a fair playing field for all countries.

Remove State Barriers

Nearly every Republican candidate this election cycle called for the removal of state lines. We support this as well as it means more competition and choices for the consumer. Removing the state lines would also mean that more people can sign up for each individual plan as the market would be bigger increasing the risk pool which makes up for the loss of the individual mandate.

The counterarguement is that it creates a race to the bottom as insurance companies race to put their headquarters in the state with the least amount of regulations. First off we must realize that the current state of obamacare is a race to a monopoly as each market is headed to a situation where only one carrier services it. If we had a choice between race to the bottom and a monopoly then the bottom is always best as there is competition. That competition would also solve the problem as each the consumer would select the provider with the best services.

Foreign Aid

The government spends billions yearly in health related foreign aid to poorer countries and to the United Nations, Red Cross, and other entities like that. This foreign aid would not be an issue if we were able to provide quality healthcare to our citizens first. With the failure of Obamacare we have shown that we cannot. This aid given to the rest of the world should be temporarily halted and put into something like a Health Savings Account given to each citizen to be used for their insurance premiums or deductibles. Once our own healthcare system is stable and fixed we can then resume giving worldwide.

The democrats and republicans have not proposed this or brought it up. We are proposing this as we believe the first responsibility of the American government should be towards American citizens.

Foreign Medical Tourism Tax

There are a lot of procedures that can only be done inside the United States. This happens due to medical skills, hospitals wealthy enough to purchase special equipment, patents, and a whole host of other things and we propose to leverage this to our advantage. There should be a new tax for foreigners who travel to the US to get medical procedures done. This money would then be put into the same Health Savings Account created in the previous bullet and be used as a subsidy by the American people to pay for their premiums or deductibles.

It does need to be pointed out for our liberal friends that the people who would end up paying these taxes would be among the wealthiest worldwide. The primary consideration of the people who need these services is availability not cost. I am not advocating for a 100% tax on this but even doubling the cost would not decrease the demand for these highly specialized services.

Doctor-Insurance Streamlining

One of the things doctors and hospitals hate the most about insurance is that it takes 6 months and sometimes a year for them to recieve payment for services they already rendered. Of course this is a trade-off as with insurance more people can afford their services. It does come at a massive cost to our doctors and hospitals however as that money is sitting in the bank accounts of the insurance industry instead of being invested by the people who earned it to earn more money.

What we propose is a bargain between the doctors , insurance industry, and the government. The next numbers I am going to give are theoretical and could change but provides the framework of what we want to happen. The healthcare industry agrees to give a rebate of 10% of anything they charge to be put into the Health Savings Account previously discussed. The Government then imposes additional regulations on the insurance industry to force them to release the funds within 2 months of when the service was rendered. The hospitals can then invest this to make up for the 10% rebate. The faster turn around time also means that more doctors would want to be involved in the process increasing available choices.

We believe that by taking the best from both liberal and conservative points and applying them with nationalism or an America first mindset we can fix our healthcare system.

Progressive Globalism : Boarding the Trump Train

bernie-sanders-2016-cartoon-caricature-feel-the-bern-democratic-socialist-president-prints

 

One of the hallmarks of progressivism is that it asks more from the rich to help out the poor. On a local level I have no problem with that. I have written about a trickle up economy here https://tsukesthoughts.wordpress.com/2016/03/30/trickle-up-the-new-economy/ and believe that the best way to stimulate an economy is to give the tax cuts and benefits to the people most likely to spend the money inside the economy creating velocity of money and providing more jobs and employment.

On a local level that is good. It is a disaster on a global level. This is my main problem with Bernie Sanders as a candidate. He wants a lot of good things but they can only be achieved by a nationalist like Trump. You are probably thinking that Sanders is a nationalist too right? Whatever label he gives himself his ideas are that of a globalist populist. Basically you try to do what is best for everyone on the globe instead of everyone in the nation. This is why his stances to the refugees, illegal immigration, and his lack of understanding on the issue of healthcare.

OVERVIEW

In its simplest form progressive policies takes money from the rich and gives it to the poor. Who is the rich though? Is it China? Britain? The EU? If you haven’t figured out yet it is America. Progressive Globalism is at its heart a transfer of wealth from the US to every other country in the globe. The country is already poor and struggling but we are about to make everyone poorer.

HEALTHCARE

One of Sanders main arguments is that other modern countries provide healthcare for all their citizens yet the US cannot. Why is this? Well the other countries have a limit on how much companies can charge for drugs and the US does not. The answer seems to be simple right? Place a limit on the drugs prices of the US. Well the companies recover their research costs in the American market. Without the American market then there would be no new drugs available. In effect the European countries can have good healthcare because the American healthcare system is bad. Once you fix the drug prices and crack down on illegal immigration, thereby lowering the total number of people who need healthcare and most likely cannot pay healthcare cost will be lowered.

Would a progressive globalist change this once he sees the impact of his policies on the rest of the world? I have my doubts. I have no doubt that a person who puts America First would have no trouble doing it.

MINIMUM WAGE : SANDERS

People will be surprised to see this on the list. Isn’t Sanders the champion of 15$ minimum wage and Trump say we may have to lower it? It should be a no brainer right? My own personal view of minimum wage is that 15$ may work for California and New York who have economies so different from Iowa, Michigan, or Alabama that they may as well be from another country but it will not work for the poorer states who will not be able to afford it.

On to Sanders, you can legislate whatever minimum wage you want. You can say it will be 100$ it does not mean that it is good for the country nor does it mean that businesses will necessarily follow it. I would like to remind everyone that illegals exist and Sanders is the one most in favour of them. They can be hired like they are now to bypass the minimum wage.

Lets look at it without the promises. What keeps wages down? Well the scarcity of jobs and the excess of workers. More workers mean that they lose the ability to negotiate a good wage because they are easily replaceable. Given this data the only way to increase wages then is to increase the frequency of jobs and remove the excess of workers.

Let us take a look at what Sanders offers. He has offered citizenship to illegal aliens and has said he would not deport any. The gist is more incentives for illegal immigrants. The pope one of the biggest proponents of this has effectively endorsed him. What does illegal immigration do? Well it increases the available pool of workers. What about companies then? Currently after all the loopholes we have a 15% interest rate. Sanders would close the loopholes so we are back at 35% and then increase the tax so we are we effectively triple their rate. I am all for taxing corporations but at some point it is better to stop doing business in the country. You also don’t hear about tariffs from Sanders because that would hurt other economies who depend on selling to the US.

Wages are low because of scarcity of jobs and too many workers. Sanders adds to both fronts.

MINIMUM WAGE: TRUMP

Well what about Trump? The person who says the national minimum wage will be lowered or left alone. Lets take a look using the same standards as Sanders. Trump has made it a central piece of his platform to aggressively go after illegals. Removing benefits, installing e verify, and then deporting them faster. This of course reduces the pool of available workers.

Trump has also made the wall a central piece of his campaign.  A lot of people see the wall as an anti – immigration program. Which it is, but it also doubles as a jobs program. After all does anybody think the wall will build itself? That adds to the frequency of jobs by itself. Trump also proposes to lower the corporate tax to 25% and close all loopholes. Corporations who can afford armies of lawyers will see their tax rate rise but small business who can’t will see it drop. The tax rate increase though is more modest than Bernie’s proposed one and combined with the Tariff Trump is threatening increases likelihood of companies remaining in the US.

Trumps policies increase the frequency of jobs and reduces the available workforce giving more opportunities for workers to negotiate a better wage for themselves.

THE MILITARY

Here both sides agree. We have to get our partners in alliances to foot the bill for more of their own defense spending. Right now because of globalization the US is paying for everyone spending facilitating the transfer of wealth from the country to outside.

The difficult thing then with Sanders position is he wants to cut the military whereas Trump wants to rebuild or spend money on it. On its face cutting the military may make sense. After all we are strong enough and we spend more money on the military than a lot of our competitors combined. If you live in a big city you most likely do not see the downside to this but there are so many small towns and cities across America that need their local base or manufacturing plant to survive. If you remove them then all of a sudden you get more Flint’s and Detroit’s. Of course the displaced citizens need jobs as well. What do you think a huge influx of unemployed workers will do to the negotiating power of labor? What do you think it will do to the demand for labor in the service industries in the affected areas.

I wrote earlier about the need for a trickle up economy but the military industrial complex is a roller coaster that we are on that we cannot get off until we have employment for the people displaced. The military is also unique in that due to security reasons they spend their money onshore. I would rather they spend all of it onshore but they spend such a high percentage that im convinced that it’s not totally wasted. If we want any hope of raising the wages we have to keep military spending as is at least for the meantime.

BOARD THE TRAIN

I feel that this article has gone on too long already so I am cutting it here. Trump does not set a high minimum wage instead he creates a condition wherein wages can be raised. As opposed to setting a wage which businesses will not be able to meet without hiring illegals. If you want quality healthcare and a higher wage I urge you to support Trump it is really the only way. Supporting someone with globalist principles, even progressive ones, just brings the standard of living of the US to the level of other countries.

If you have any other points that you would like me to address as to why only someone with the philosophy of Trump can achieve the goals of Sanders put it in the comment section below and ill make an article for it in the future.