Apr 1, 2017 5 min read

The U.S. House of Representatives failed to even consider the American Health Care Act because it could not win approval, and for good reason.

It essentially applied the Obamacare model, but a less effective version of it. It deployed tax credits instead of subsidies, limits on Medicaid coverage, and would have allowed insurers to charge higher premiums for people without continuous coverage instead of using a tax penalty. It reduced health care coverage in order to cut taxes for the wealthy.

Politically, conservatives didn’t like it because it wouldn’t have changed the structure of the system set up by Obamacare, while moderates didn’t like it because it would have reduced coverage while raising costs for consumers.

The fundamental criticism raised by the conservative critics of Obamacare challenged the very notion of health insurance. Their primary criticism has been that people are forced to buy insurance, and that insurance has to cover 10 areas of care, thus raising its cost. These critics think people should have the right to assume the risk for their own health, and be able to save money by purchasing less extensive coverage, or forego health insurance completely.

There are two aspects of this personal assumption of risk that need to be considered. First, philosophically this can be a rational argument. Taking the risk of going without health care coverage to save money is not unreasonable. But to really assume that risk fully, people who do so should not get health care if they do get sick, unless they can pay for it out of pocket. Otherwise they are socializing the risk because others are paying for the health care they need, while privatizing the benefits – they get to keep the money they did not spend on premiums.

But for this to be a real option, that means many people who took the risk and lost would not get care, and, as a society, we are not willing to let people die because they chose to go without health insurance. So, while it is philosophically sound, in practice, we are – I think rightfully – unwilling to let people suffer the consequences of their poor decisions, so that would not work.

The second aspect of the conservative critique goes to the nature of health insurance, and is exemplified by male politicians suggesting that they should not be forced to pay for pregnancy and maternal care, which certainly can be expensive, because they will never need those services. Aside from the reality that a male is at least partially responsible for pregnancies, and that we all have a vested interest in making sure women can bear healthy children, the thrust of the criticism is that insurance is inefficient. If I don’t drink, it is unlikely I would ever use alcohol rehabilitation services, so why should my premiums include these costs? But if you carry this argument to its logical conclusion, you essentially eliminate the role of insurance.

If I somehow knew what illnesses I would contract, and what treatment I would require, I could pay for an insurance policy that only covered those services. But for an insurance company to offer such targeted insurance, it would need to charge the full cost of those services, plus administrative fees and profit, so it would be more efficient to just pay cash.

Since it is impossible to know what medical services we will need throughout our lives, and we are unwilling to let people die in the streets because they were foolish enough to go without medical insurance, these conservative critiques, while rational, are not practical.

Conservatives are right to argue that if people spend their own money on health care, the costs will be reduced. But the unpredictability of emergency care, and the potential costs of chronic care, limit the likelihood that this will work; it is difficult to shop for the most cost-effective care during an emergency, and chronic care is difficult to pay for out of pocket because most people who need it incur such high costs that they cannot pay without assistance.

High deductibles are another attempt to save costs, since the first payments patients pay come out of their pockets, but this is one of the points that critics use against Obamacare. High deductibles can also discourage people from seeking treatment, which may save costs in the short run, when the treatment is deferred, but could lead to greater costs later if going untreated leads to more expensive treatment.

In designing a healthcare system, there are three goals: complete coverage, low cost, and high quality. The problem is you can only achieve two of the three.

Obamacare provides coverage without sacrificing quality, but at a cost.

Conservatives want to lower costs, but must either sacrifice quality or coverage, which is very unpopular. Instead of reinventing health care for political reasons, Republicans should embrace it as market-based conservative plan, and make it better. Raising the tax penalty would encourage more healthy people to buy insurance, reducing the premiums for everyone else, and providing a public option in markets where there is insufficient competition would address the two biggest problems with Obamacare.

Kent James is a resident of East Washington.