President Trump is currently in the process of reevaluating the American healthcare system. As part of his policy, he is urging fellow republicans to repeal the individual insurance mandate, which is intended to spread health risk over the largest possible pool in order to keep premiums low. Though the repeal is intended to allow for the expansion and strengthening of the middle-class through tax-cuts, it will likely end up hurting the middle class by increasing premiums and consequently the number of uninsured. Moreover, without the individual insurance mandate, uninsured individuals who are ill or injured can walk into the emergency room and get treatment, essentially piggybacking on the hospitals, doctors and American citizens who are now paying higher premiums to compensate. On the other hand, under Obamacare, some individuals also cheated the system by paying premiums temporarily to become insured for expensive doctor visit/treatments and then ending their premium payments afterwords. Even though there is a penalty in place, many people were not sufficiently incentivized to stop abusing the system.
Regardless, the United States should be able to provide reasonably priced healthcare that all citizens can afford while maintaining simplicity. So, the question is, what is the best approach that maximizes efficiency and the health of American citizens while minimizing abuse and corruption?
Many believe the solution can be modeling the healthcare system off of the Swiss healthcare system, one of the world’s best health systems in which the public and private sectors work together to keep a healthy population. In Switzerland, individuals purchase compulsory basic health insurance but can also choose their own private insurance to supplement the basic health insurance. In this system, inflation is kept at bay due to high levels of competition in the health insurance industry. Given that Switzerland is a small and wealthy country with citizens who lead relatively active and stress-free lives, is the Swiss model scalable? According to Paul Ryan, a Swiss-style health system could work and satisfies both liberals, universal health-coverage, and conservatives, low government spending. He additionally suggests using the defined-contribution system instead of the Swiss ten-percent cap for income as that could cause unwanted medical price inflation.
All in all, the solution lies in in a Swiss-style public-private partnership in which the right balance must be achieved. This leads to the question: how much power will the private vs public insurance hold? What is the private insurance market responsible for as opposed to the public? When the system is all public, the government will look for the best options financially rather than for its citizens’ health. Despite this, government inefficiency may lead the government to run out of money (like general motors filing for bankruptcy a while ago as a result of pensions). On the other hand, when health insurance is all private, insurance companies will not be incentivized to insure the sick and ill, so that they can avoid the high costs of their medical care.
In the end, Obamacare was poorly thought out and forced through as part of the democrat agenda. There was no rational talk between all the players: the healthcare industry, the American government, insurance companies, doctors and citizens. It’s really a shame that politicians can’t sit down and objectively come up with a healthcare plan that is best for our country and its citizens.