Navigating the corridors of Washington DC power, one can turn any corner and encounter a Republican who professes to despise Obamacare while remaining devoted to the notion of seeing to it that Americans with pre-existing medical conditions have access to health insurance.
Should time and space prevent you from experiencing this deeply felt care and concern up close in the halls of Congress, not to worry. GOP leaders and Republican talking heads fill the airwaves on a daily basis to let you know just how much they feel the pain of those with medical conditions who, pre-Obamacare, were either blocked entirely from the entering the health insurance marketplace or were effectively blocked from purchasing insurance policies that were so expensive that Warren Buffet would struggle to cover the monthly premium costs.
Well, maybe not Warren Buffet.
But do you know what you will never encounter, whether when strolling the passageways of government or watching your favorite cable news station?
You will never hear those who reject Obamacare, while lauding coverage for those with pre-existing medical coverage, tell us how they are going to accomplish this coverage now that they have done away with the penalty imposed on Americans who fail to purchase health insurance as required by law.
There’s a good reason for that.
These opponents of Obamacare – who are sudden converts to protecting those with pre-existing medical conditions now that their constituents have spoken- have absolutely no idea how to create legislation requiring health insurance companies to offer coverage to those with pre-existing conditions at an acceptable price. They have no idea how to do this because they obliterated the only device in existence to make this possible through the private health insurance system.
Recall that the tax reform bill signed into law in 2017 repealed the penalty levied against those who failed to purchase health insurance they were required to pay as a result of the Obamacare mandate.
That means that while you remain legally required to have health insurance, beginning in 2019 there is no longer a penalty for failing to follow the law in this regard. Thus, many of those young and healthy Americans who we were counting on to balance out the health insurance pools (more on that in a moment) will vanish from the health insurance equation once they no longer have to pay a price for failing to jump into that pool.
If you are confused as to where there is a connection between the tax reform law passed last year, including the end to the penalty for failing to purchase health insurance, and Obamacare, I take you back to the moment when Chief Justice John Roberts upheld the constitutionality of The Affordable Care Act by affirming that the penalty individuals were required to pay under the law for failing to purchase health insurance was a tax-and that the government is constitutionally enabled to levy a tax. He also noted that forcing Americans to buy an insurance policy, whether they want to or not, was not constitutional, but if we were talking about taxing someone for failing to do so, then it passed constitutional scrutiny.
While many found Roberts’ rational flimsy and little more than transparent word play designed to keep Obamacare afloat, the result of his tie breaking vote did, in fact, make it possible for insurance companies to meet the requirement of providing coverage to those with pre-existing conditions at something approaching an affordable price. The SCOTUS decision did this by insuring that the younger and healthier people critical to that insurance pool I mentioned would have to join those pools or risk having to pay the penalty for failing to do so.
So, let’s jump into the insurance pool concept and why Justice Robert’s opinion was so critical to those with pre-existing conditions.
The rule of thumb in the health insurance world is that for an insurance company to be successful, the pool of people to whom they are extending insurance coverage must operate with 80 percent healthy people and 20 percent sick people. If the numbers vary too far from that equation on the sick people side, insurance companies start losing money-and lots of it.
Now, imagine a law that requires the insurance companies to add more to the ‘sick people’ side of the equation (people with pre-existing medical conditions are far more likely to be ill in the future than those who have no previous health problems) but are limited in how much the premium charges can be for these folks.
You can easily see the equation very quickly tilting in the wrong direction when it comes to insurance company profits and losses.
So, how do we fix this? How do you insure that 20 percent of the pool who are more likely to be ill in the future doesn’t grow to 25 percent, 30 percent or an even larger and unworkable percentage of the pool?
You must get more healthy people into the pool to maintain the balance.
Since the days when Teddy Roosevelt first began discussing the importance of national health care coverage, nobody has found a successful way to maintain a balanced health insurance pool without finding a way to bring in healthier people to cover the costs of the sick.
We’ve tried state high-risk insurance pools.
They didn’t work.
The hight-risk pools don’t work because there are far more people who meet the test of having pre-existing conditions than the states can afford. Remember that these high-risk pools include 100 percent sick people and that means large insurance pay offs-far larger than can be covered by premiums regular people can afford to pay. That leaves the states to pick up the tab and they just can’t handle it. The result of this inability to cover the costs causes the states to limit how many people can participate, leaving many on a waiting list for health insurance coverage that can last five years or more.
Even with the input of federal funds to state high-risk pools, there simply isn’t going to be enough money that could make it through Congress to make these pools work.
That leaves only one other option- let those with pre-existing conditions into Medicare and Medicaid.
This remedy could work-but Republicans have shown little interest in expanding these federal programs.
And that brings us back to the question of how our lawmakers-having already killed off the one device that allows the private insurance market to handle those more likely to be sick-can deliver on their professed sympathy for those in the health insurance squeeze.
If high-risk, government run insurance pools don’t work-and we know they do not- and expanding Medicare and Medicaid as an option for those with high-risk medical histories is off the table, how does this get done?
It doesn’t-and that is why those who voted to end the penalty for failing to purchase insurance have doomed the system that makes it possible for our fellow Americans who come with pre-existing medical conditions to get coverage at a price they can hope to pay.
This self-inflicted wound, delivered by those who thought they were being so clever when they destroyed the penalty, have created a situation where they either must support expanding government programs to include those with pre-existing conditions (a political no-no for the GOP), return to the days of assessing penalties on those who don’t buy coverage to give private insurers an opportunity to cover these folks without losing their shirt (they are going to look pretty silly if they do this) or simply fail to deliver on their professed concern for these affected Americans.
Not a good position for these politicians to be in but one of their own making.
Sadly, there will be no relief for those who, through no fault of their own, bring their medical histories with them to the insurance marketplace- at least no relief until Democrats have control of both houses of Congress and the White House.