At first blush I don’t have a huge problem with a Virginia federal judge declaring the Obama healthcare plan unconstitutional. The judge argues that the government cannot force citizens to buy products from private-sector vendors. I agree.
Under a single-payer arrangement, doctors, hospitals, home-care services, and so on would all have continued to be private-sector providers of care. Their services would have been accessible to all, paid for by the government subject to whatever copays and deductibles would have applied. If you didn’t want to use the single-payer plan, you could of course make other arrangements, find other ways to pay — although of course you wouldn’t receive any sort of refund from the single-payer plan in which you are automatically enrolled. This is the way Medicare currently works, and to my knowledge there are no legal challenges to its constitutionality.
Under Obamacare, low-income citizens would qualify for a subsidy to pay for private health insurance. People who choose not to buy would be subjected to a fine: presumably it’s this punitive fine that’s constitutionally objectionable. If the fine is eliminated, then the obligation to buy would be eliminated and Obamacare would pass constitutional muster. The revised plan would still be better than the status quo, and in some ways it might be an improvement on the original plan. The substantial government subsidies of insurance premiums for low-income people would still be in effect, significantly reducing the ranks of the uninsured. Those who still choose not to buy will unfortunately include the very poor, who still can’t afford the premiums. But the non-buyers will also include the very healthy, for whom the exorbitant price of private health insurance doesn’t seem worth the benefits. It’s this latter, relatively low-risk group that the insurers were hoping to lure into the Obamacare risk pool. Fines levied for failing to buy the product would have effectively eliminated any incentive for the insurers to compete for the uninsured’s business based on price. With the fines tossed out, competition theoretically returns to the market. As long as we’re stuck in the private sector, a little more price competition is better than none.
That the conservatives’ removal of a critical component of Obamacare might actually prove beneficial to the citizenry and harmful to corporate financial interests illustrates what a fundamentally crappy plan it is. In all likelihood though, the conservatives won’t stop with removing the obligation to buy private insurance: they’ll take the whole plan down, including premium subsidies for the poor. For all its failures, Obamacare at least would have reduced the number of uninsureds; now even that gain will almost surely be lost.
A year ago many progressives were arguing that Obamacare, while seriously flawed, was at least a step in the right direction, a piece of legislation that could be built on incrementally. Now one has to wonder whether the Dems shouldn’t have gone all in for single-payer, which is after all a coherent and internally consistent scheme. Of course neither Obama nor Hillary supported single-payer during their presidential campaigns, so there never was much chance. Further, the success of single-payer requires that the government actually negotiate deals — with doctor networks, pharmas, hospitals, and other corporate vendors — that benefit the citizenry, seeking the best care for the lowest price. Frankly, I doubt that the government is up to it. After all, the US government serves as single payer for military goods and services, and it certainly doesn’t seem to drive very hard bargains with those contractors, regardless of which party is signing the checks.
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14 Dec — From today’s Associated Press:
“Hudson limited his ruling to striking down the so-called individual mandate, leaving intact other portions of the law. But administration officials and outside analysts agree that important provisions of the legislation could not go forward without the requirement for everyone to be insured. That’s because insurers need to have large pools of healthy people, who are cheap to insure, or it is not financially tenable for them to extend coverage to those with pre-existing medical problems.”
Exactly. The individual mandate is why Obamacare was so attractive to the private health industry, why they supported the plan. It’s unclear to me that the Republicans, who support — and who are supported by — these corporate constituents just as much as the Democrats, will really want to disallow the individual mandate, which subsidizes billions in extra private-sector revenues/profits. We’ll see how it plays out.