Health Care Reform for the Forgotten Man

As a person who purchases their health insurance in the individual insurance market place I do not feel sorry for the Affordable Care Act supporters. I am keenly concerned with what I call Health Care Reform for the Forgotten Man will look like. I was recently reminded in a post by Harold Pollack on the Incidental Economist blog than the supporters of the Affordable Care Act are in a pissing match with the insurance companies about covering people who are both uninsured and un-insurable. Asking insurance companies to take customers they are going to lose money on is a dumb way to run an insurance company but that is the Affordable Care Act’s supporters big idea. As a healthy person I did not ask to be involved in their idiotic debate but in their perverted political logic they decided that healthy people like me can be coerced into helping them solve the problem with the un-insurables. This is the Forgotten Man scenario outlined by William Graham Sumner and made famous by the Amity Shlaes book, The Forgotten Man: A New History of the Great Depression. I thought we learned our lessons after a decade of failed grand ideas in the 1930’s. Good policies have to make sense to the people paying for them. Health insurance was a product created for the middle class and paid for the middle class. The rich do need it and the poor do not have the money to buy it. Do we really want to go down the path in which health care insurance reforms do not make sense to the man and woman who are ultimately paying the bill? Are we really asking the most price sensitive people in the health insurance market to bear a disproportionate share of society’s burden for un-insurables and hope that it turns out okay?

So where do we go from here? Once again Harold Pollack reminds us that there is no room for debate. Recently he dismissed a fairly modest proposal for individualized health insurance plans as a non-starter. As a healthy person I think that an individualized health insurance plan is the next logical step for health care reform. In fact I will go one step further. My perfect health care plan is an individualized health care plan issued from my local hospital that includes my local doctor. The perfect plan for the business I work at is a defined contribution plan. If we combine both of these together we arrive at the conclusion that if health care is to evolve to a more perfect system then it will be primarily a local solution with possibly some state-wide or regional features. This local focus does make you wonder how a federal program became the big player in an inherently local problem. If health care is to evolve into a better system then the Affordable Care Act looks like a step in the wrong direction. My second choice is a plan similar to the one they offered when I first started working in 1976. Everyone signed up for the plan because it was inexpensive and inclusive. When the third party payer system is working right and large group plans are cheaper than individual plans, this type of solution is a no-brainer. Unfortunately we have strayed far from the path since 1976. Since most large group plans are more expensive than the individual plans it is easy conclude that the third party system is already dead and that businesses will enter into a defined contribution arrangement as quickly as possible. My third choice would be to keep my existing plan and rates. Every time a supporter for the Affordable Care Act says that there are no alternatives I grit my teeth. It is bad enough that my rates are rising rapidly but now my insurance company, Aetna, has announced that they are not going to participate in the state exchange. All of this uncertainty and fear was not supposed to be happening to healthy people who had health insurance. If the plan by the Affordable Care Act supporters was to make everyone miserable, they have succeeded. Yea, I am pissed. So I am left with my fourth choice, the Affordable Care Act. It does nothing for me except cost more. The supreme irony of the Affordable Care Act is that it is littered with so many failed programs, delayed mandates, and confusing regulations that it is the poster child for smaller government. I doubt a libertarian could have deliberately screwed up the Affordable Care Act as well as its well intentioned supporters have. The best way to judge the Affordable Care Act reforms is to see whether the reforms can stand on their own or whether they require the IRS to enforce them. Most of us can still remember when we had perfectly good health care plan without IRS involvement. The supporters of the Affordable Care Act are now arguing that although there are some flaws in the Act this is a good first step for health care reform. From what I have seen of the reforms that is akin to throwing a grenade into a crowded room and saying that is a good first step at getting people to exercise more. At some point we have to start realizing that the Affordable Care Act is not a creative destructive force of good but a plain old, well intentioned, destructive force. This is something that the unions and the general population agree on. We have seen the future of health care and it looks a lot like Detroit.