Healthcare Update and why Dave’s Plan is Best

“Medicare for all would cost $32 trillion” ,”stripped down low-cost policies now available”,  “Obamacare loses pre-existing condition protections”, “Democrats will highlight Healthcare in the mid-terms” and “House bill allows for more Health Savings Account (HSA) Flexibility”.  Healthcare has been in the news lately and in political campaigns signifying  noise but little forward motion.  Democrats in many of the mid-term races are making healthcare a centerpiece.  What that means varies between  bailing out Obamacare to Medicare for All.  By easing requirements to cover pre-existing condition and allowing stripped down short-term health policies the administration further destabilized the already wobbly Obamacare.  What these efforts won’t do is bring us closer to a workable health policy.  Just more nails in the Obamacare  coffin without replacing it with a workable healthcare plan.

Charging into the breach, progressives led by Sen. Bernie Sanders and his young Congressional candidate companion, Alexandria Ocasio-Cortez with their plan to save the day, Medicare for All.  The idea is everybody loves Medicare so let’s give it to everybody.  On the face of it, it would seem a poor idea to add millions and millions of people to a program that no longer is keeping its head above water.  Adding to the idea’s questionable fiscal sanity was a report by Charles Blahous of Mercatus Center at George Mason University showing the plan would  add $32.6 trillion over the first decade of Medicare for All.  Not deterred, Sen. Sanders and Ms. Ocasio-Cortez proffered Blahous’s report actually shows when all healthcare costs are figured in Medicare for All is a great bargain.  Mr. Blahous apparently wasn’t amused and took to the Wall Street Journal Op-Ed page to show that this clearly was untrue.  Citing not only his work but other concurring studies he laid waste to the Sanders-Ocasio-Cortez talking points.  One would think that would be the end of their use of his report in their talking points, but you would be wrong.  Days after the OP-Ed was published, MS. Ocasio-Cortez appeared on Chris Cuomo’s CNN prime-time show and repeated the same discredited talking point that Blahous’s report shows Medicare for All is a bargain.  Of course Chris Cuomo brought up Blahous’ refutation of everything she was saying. Wrong.  He sat there never uttering a question or fact.  Now in show prep for her appearance this WSJ OP-Ed surely would’ve come up. We always thought Cuomo was a dim bulb but where were the producers?  Cuomo just thanked Ocasio-Cortez  profusely  for her appearance and  insights.  Apparently Bernie and Alexandria will repeat this refuted talking point at every opportunity. Such is the state our healthcare discussion.

On a brighter note, The House passed a bill giving greater flexibility to Health Savings Accounts.  Now you might think this is no big deal and maybe they should be working on something meaningful to more people such as saving Obamacare.  It might surprise a lot of people 11.4 million people were expected to have been covered under Obamacare in 2017 the latest reporting year.  Over 20 million people have heath savings accounts.  Surprised?  Since they were introduced in 2003 under even more restrictive circumstances the popularity of these accounts have outpaced the growth of any other type of health plan.  Centered in employer and large group markets, the ones best able to understand cost-benefit comparisons, HSAs will prove even more popular with increased flexibility.  How is it in a world dominated by incomprehensible third-party health plans this simple joining of catastrophic insurance and savings is growing faster than anything else?  The simple answer is this is the natural relationship between insurance and your money.  We insure against mishaps we can’t presently handle.  We handle the small stuff.  The ship might sink, insurance.  The rigging needed replacing, you pay.  Your house might burn down,insurance.  Replacing the rugs you pay. It restores the natural relationships.

Why is this important?  Nobody really knows the cost of most medical services.  Imagine going to an online website looking for something you really need.  Instead of telling you your options and costs, it tells you what it thinks you need and whether you’re covered and if there is a co-pay.  Only when you pay out-of-pocket, before meeting the deductible does anyone have any reason to ask about costs and options.  There is no marketplace. On the other hand, with HSAs most transactions are paid out of pocket so there is no escaping questions of costs and options.  The difference is akin to doing business in the old command Soviet Union and the U.S. capitalism.  Does anyone still think the Soviet system was superior to the marketplace? Yet the biggest part of our healthcare system mirrors the Soviet command economy.

The growing awareness of the HSA”s value was expressed in  Dr. Scott W.  Atlas June 19 Wall Street Journal Op-Ed, “Health Savings Accounts for Everyone.” In it Dr. Atlas , a fellow at Stanford’s Hoover Institute, shows the HSA’S superiority in areas of cost and option awareness and in the crucial area encouraging innovation.  Maybe Charles Blahous and Mercatus would do us the great service of side by side comparison between Obamacare, Medicare for all and HSAs for everyone.  We would bet heavily on the market based plan.

However, while we think this movement towards HSAs is positive, we can do even better.  HSAs failure is failing to go to a superior logical conclusion.  Why do we need another segregated tax favored saving plan when the majority of people already have Tax Favored savings plans.  Rather than another plan, why not just join catastrophic Health Insurance to existing plans , make them individually owned , extend them universally.  This would do everything positive HSAs provide but add vastly greater credit worthiness.  That in  turn would allow for not just a medical ID card but a medical credit card.  In turn, the use of a medical credit card would cut overhead and credit costs in a major way while at the same time empowering medical consumers.  This would provide a market environment conducive to maximum innovation. Dave’s Plan found on this site would do all of this and more.  If you haven’t already, take look and see if you don’t agree.  Better, let’s add Dave’s Plan to that side by side comparison.  While we think it would prove HSA’s are superior to the other two, Dave’s plan by doing  everything HSAs do but much more would demonstrate its superiority.

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