The latest insurance company to pull out of the Obamacare exchanges because of financial losses shines a light on the slippery foundation upon which it was set up. In the haste to be all things to all people in order to sell it, little thought was given to how it would actually work – the ‘unintended’ consequences continue to pile up, but if proponents of overhauling the healthcare system had practiced critical thinking instead of pursing their goal to pass a progressive agenda at all costs, they would have seen this coming.
These are the fatal flaws that make Obamacare unsustainable despite all of the rhetoric that it can be made better:
- Millennials cannot afford to sustain the spiraling costs for those who have medical problems who rely on insurance.
Structural problem: When parents were allowed to keep their children on their insurance plan until age 26, this guaranteed that there would be a significant decrease in young healthy people entering the insurance pool.
Strategy to maintain the facade: Divide and Conquer has been used to try to divert the attention of Millennials from the problem by blaming seniors for the high cost of healthcare. However, it completely ignores the fact that seniors gave up over 700 billion dollars from Medicare to help set up Obamacare. So they have sacrificed just as much as the young people.
- ObamaCare doubled down on the most expensive aspects of healthcare. Instead of reigning in costs, it has rewarded the triumvirate of insurance companies, Big Pharma, and corporate hospitals at the expense of the doctor patient relationship, patient privacy and healthcare affordability.
Structural problem: The reliance on corporate interests to help craft Obamacare has led to the consolidation of the healthcare system. Dozens of insurance companies have dwindled to 5 major companies; Independent pharmacies have been put out of business by large chains that now have a monopoly; and rural, physician owned and community hospitals have closed or been annexed by corporate hospitals that have morphed into large systems which control non transparent pricing in the healthcare market. Independent doctors who offer accessible affordable health care have been removed. Because of onerous regulations and artificially low reimbursements which have not kept up with the cost of doing business, they now are a minority of the doctors practicing medicine. For those who are left, there has been an exodus to employed hospital positions where they have a fiduciary responsibility to the hospital who sets the prices instead of to the patient. Less choice has edged out the free market in deference to a centralized system based on a monopoly.
Strategy to keep the charade alive: The doctors have been blamed as the reason for the spiraling costs, when the truth is doctors account for approximately 7 cents of every healthcare dollar spent. In fact, it is the hospitals with their administrative costs and exorbitant charges, insurance companies cost shifting to patients with ever increasing premiums and out of pocket costs, and pharmaceutical prices rising exponentially for brand and generic drugs that have made the choice to see the doctor or go without insurance just as prevalent for many today as it was before Obamacare.
- Politics was used to fundamentally change the healthcare system without regard to correction of the underlying problem of the 3rd party payor system which inserts the government and insurance companies as the middle man and adversely affects cost and access to healthcare.
Structural problem: Obamacare was always about using central planning to overhaul the healthcare system while wresting control of one sixth of the economy in order to transfer wealth from the middle class and working poor to corporate interests in the form of health care payments and to the Government in the form of taxes.
Strategy to keep the myth that it is working going: Through mandates, compliance and legislative coercion (i.e., the ‘doc fix’ and value based medicine) Obamacare has morphed into a large public private partnership between the government and the drivers of corporate healthcare who want complete control over the behavior of doctors and patients by controlling access via cost for both at the expense of quality affordable patient care.
Logic dictates that trying to fix Obamacare will lead to a single payer system that will take our healthcare system further in the wrong direction of increasing costs, less access and more central control. However, repealing it and empowering the alternative of individualized, quality, affordable healthcare driven by doctors and patients pursuing free market consumer based medicine is what should replace it.