19 August 2016

Interesting Take-Away on "Fixing" Obamacare

Over at Naked Capitalism, a commenter makes a long and detailed post about Aetna and its pulling out of the exchanges. He ends with this:
Finally, two important take-aways from this. First, there is nothing in ObamaCare for Hillary’s “incrementalism” to address. It is simply too broken for even the industry’s master to deal with. Second, much as they tried, the Republicans did NOT kill ObamaCare. Capitalism did.
I think that this is an accurate description of the problems inherent in the system.

He also states that he was familiar, though not necessarily involved, in discussions on the "Public Option", and that it was not killed as a sop to the insurers and big pharma, but because it it could not be made to work in the way that the Obama administration wanted it to, which was to screw sick people without making it too obvious:
………The public option (and this comes from as close to an insider as you’ll ever likely have) was put in as a dumping ground for the pre-existing conditions that the insurers didn’t want. It was in effect a high risk pool by another name, because “high risk pool” would make ObamaCare sound too much like car insurance, not a good selling point for sure. The problem was how to get high risk claimants into the public option without using the words pre-existing conditions. Could their actuaries identify these people by other criteria in a close enough fashion to where the math would still work out (i.e., where profit was still there). As time wore on, it became clear that this simply was not going to be possible, at least not to a level that was close enough to make the idea work.
This narrative makes sense to me, since most of Obama's initiatives in the area of regulation and the roll of government have been directed toward privatizing profits and socializing losses. (He is very much a Chicago school kind of guy)

It's a cogent critique which boils down to:  If you want healthcare to work in a profit driven marketplace, you can't.

Of course the Teabaggers out there will have a different take, which is that Obamacare was designed to fail to force us into single payer, which would turn all of us into Kenyan Muslim Communists., but Teabaggers believe that markets can never fail, that they can only be failed.


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