The real metric for fixing health care

Patients in Tennessee are seeing insurers drop out of the Obamacare exchanges like flies – another reminder that America's signature health care program has serious problems with dire consequences.  Both major political parties acknowledge Obamacare's woes, but different metrics for fixing these problems have made civil and rational discussion impossible.

Despite what partisans might say, both parties do in fact share the goal of providing health care for every American.  There are, however, real differences between their approaches.  While Democrats measure success by the number of people covered by health insurance, Republicans primarily measure success by the price of health care.

If Congress wants to put quality health care within reach of every American, price is a much better metric than coverage.  If prices come down, people will be able to afford coverage.

Today, even people who are covered by Obamacare still suffer from price increases in the form of ever rising deductibles and out-of-pocket costs.  Since 2007, deductibles have risen six times faster than wages according to The Wall Street Journal.  In many cases, patients covered by Obamacare can't afford to get sick for fear of having to pay thousands of dollars.  In 2017 alone, the average deductibles for the cheapest plan for individuals and the bronze plan for families are $6,000 and $12,393, respectively.

This problem is so widespread, one survey from last year found that four out of ten adults who are covered on the Obamacare exchanges are not confident they can afford care.  It's no wonder, then, that one New York Times headline dubbed Obamacare coverage "all but useless" due to high deductibles.

Rising prices also hurt the most vulnerable on Medicaid.  Already, Medicaid patients are often rejected by doctors due to low reimbursement rates, and over 600,000 disabled people are on waiting lists.  States that expanded the program are considering charging recipients more to deal with the rising costs.

The data is clear that the root cause for these price increases is Obamacare itself.  Instead of lowering prices as repeatedly promised, premiums have skyrocketed under the law.

New data show that health insurance premiums for every age group and household type rose or fell by less than 9.2 percent in the four years before Obamacare.  Those same plans' premiums rose between 56 percent and 63.2 percent every year for four years after Obamacare went into effect.

It is not sustainable to ask the government to pay for ever rising health care costs.  Instead, Congress should work to make health care less expensive so patients can afford it for themselves.

Skyrocketing prices are not our destiny.  We can fix this problem.  The reason health care is so expensive is because patients are not actually making decisions on how to spend money for themselves.  Instead, the industry is almost entirely controlled by third parties due to perverse government incentives like tax exclusions for employer-provided insurance.  Getting rid of these incentives would empower patients to make decisions that reflect their needs.

One way to do this is to increase employer and individual contribution caps on Health Savings Accounts (HSAs), which allow patients to use pre-tax money to control of their own spending and buy portable health care.

Empowering patients as consumers isn't an alien concept.  Just look at the areas of health care where patients control the spending.  Cosmetic surgery has significantly lower price inflation than other health care treatments, and prices for LASIK have actually fallen over the years.

This only confirms what we already know: choice and competition are proven to spur innovation and bring prices down.  In other industries, once expensive commodities like cell phones and computers have become accessible for even the poorest people.  But these results are achievable only in health care if patients have the power to make choices so that providers must fiercely compete for their business.

Right now, Congress is trying to come to an agreement after the American Health Care Act, which kept much of Obamacare's regulations, was pulled due to lack of votes.  Going forward, Republicans should learn from their mistakes and let consensus lead the way.

First, they must repeal all of Obamacare's costly regulations, just as every Republican promised for seven years.

Second, instead of pushing a comprehensive bill no one can agree on, they should enact targeted, consensus-driven reforms to lower prices, take care of people with pre-existing conditions, and expand the supply of providers.  Furthermore, they ought to give states the power to reform Medicaid to best serve those who truly need it.

These reforms could even get the support of red-state Democrats in the Senate.  After all, both parties want to fix the problems their constituents face.  But if Republicans are going to lead, they need to define what success looks like so both sides can engage in a civil manner.

Chris Medrano is a native of northern Virginia and recent graduate of James Madison University, where he earned his B.A. in political science and English.  Follow him on Twitter @cjmedranski.

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