Pre-existing Conditions: Healthcare Kryptonite for Republicans

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March 9, 2017 by Anders Ingemarson

The Investor’s Business Daily 3/7 editorial headline said it best: Republicans Cave on ObamaCare. After acknowledging that the plan has some good elements, the piece quickly zooms in on its weakest link:

“But the biggest problem with the GOP plan is that it preserves the beating heart of ObamaCare — the ‘guaranteed issue’ mandate. Under ObamaCare, insurance companies can’t deny coverage in the individual market to anyone who is sick, or charge them more. Premiums can only vary based on age.”

True to form, Republicans seem hell bent on wasting another golden opportunity to truly reform the country’s healthcare system. Democrats surely must have a hard time keeping a straight face. The AHCA (American Health Care Act) retain most of the ACA (Affordable Care Act) provisions in spirit. It is fitting that the acronyms are almost interchangeable.

Why is a Republican majority never up to the challenge? It is not because of a shortage of solutions to truly reform healthcare. John Goodman of The Independent Institute proposed 10 ways back in 2013 to mention one example. And many studies have shown that individuals with pre-existing conditions would fare better under a free-market healthcare system where insurers are competing to cover these individuals at market prices instead of as today engaging in a race to the bottom avoiding them as the plague; in fact, and not surprisingly, healthcare regulations made preexisting conditions an issue in the first place by restricting health insurance portability.

As we explained in “Pre-existing Conditions: Healthcare Kryptonite” back in 2012, the reason for the reluctance of many supposedly free-marketeers in general, and Republicans in particular, is ethical. By popular demand, we’re republishing the entire piece as, sadly, the Kryptonite is as deadly today as it was 4.5 years ago.

“In the debate over the future of healthcare in America, the issue of pre-existing conditions seems to act as Kryptonite on many free market bent individuals. When the statists shout “Do you want to deny healthcare to people with pre-existing conditions?” these supposed free marketeers often lose all their strength and turn into babbling invertebrates. The country is littered with politicians from this group supporting pre-existing conditions legislation both at the federal and state levels when they should know better.

“Why is this? Why is it so hard to face the accusations and answer “You’re darn right, I will not sacrifice the rights of health insurance companies to offer whatever policies they think are good for business because you think someone with a pre-existing condition deserves coverage!” After all, individual rights apply equally to someone with a pre-existing condition and someone working for or owning a piece of a health insurance company.

“We have to go to ethics to find the answer, to the moral code most individuals unfortunately subscribe to, implicitly or explicitly. That moral code is of course Altruism, the notion that my need is your obligation; that robbing health insurance company coworker Peter is justified to pay pre-existing condition inflicted Paul. If we want to achieve a truly free healthcare market that respects the individual rights of all participants, we have to reject this notion.

“How would people with pre-existing conditions fare in a laissez-faire capitalist market? The short answer is “better than ever”. Here’s a sample of reasons why:

  • Parents-to-be would be offered an array of “pregnancy” insurance options covering rare but financially devastating medical conditions. If you were unfortunate to be born with one of these rare conditions, your medical needs would most likely be covered for life.
  • A multitude of catastrophic health insurance options would cover post-birth diseases currently classified as pre-existing conditions. And not unlike life-insurance, the earlier you get coverage, the cheaper it is. A perfect birth gift from proud grand-parents!
  • Insurance companies would work closely with the scientific community to find cures to all kinds of rare diseases. After all, cures reduce insurance payouts which translate into higher profits and the ability to compete with lower premiums. There’s no better incentive than the profit motive! I suspect we would see hitherto unimagined new medical discoveries eradicating debilitating diseases and increasing life expectancy.

“To get from here to there while minimizing the financial impact on people with current pre-existing conditions will obviously require a plan. But once we reject the moral idea that someone’s pre-existing condition is a claim check on his neighbor, and accept the political idea of total separation of state and healthcare, plenty of smart people will figure that out in a heartbeat. And the Kryptonite will have lost all its power.”

Add to the above that individual rights violations don’t end with the health insurance companies: people without pre-existing conditions are subject to a great injustice by having to subsidize the mandates through artificially high health insurance premiums and health expenses.

We can only hope that the AHCA will not make it to Trump’s desk in its current form. If it does, and if he signs it, Republicans will deservedly own the train wreck it will inevitably turn into.

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