By way of a follow-up to what we discussed on Monday regarding the horrendous Obamacare replacement options being floated by Paul Ryan and the congressional Republicans, let's review what's perhaps Donald Trump's favorite solution. It doesn't take any special insight to know that it's a ludicrous idea that's never really worked.
In addition to high-risk pools, health savings accounts and so forth, Trump has repeatedly mentioned the idea of allowing health insurance companies to sell across state lines. This is Trump's top-shelf replacement plan. Incidentally, Kellyanne Conway pitched it on Greta Van Susteren's new MSNBC show Tuesday.
This is all he's got, folks. And it's stupid.
Here's the main problem, and don't expect Trump or Paul Ryan to acknowledge this. Actually, I suspect Trump doesn't have any clue whatsoever about what I'm going to describe. Simply put: since insurance is predominantly regulated at the state level, insurance companies would ostensibly set up shop in the states with the softest regulations, not unlike how businesses often incorporate in Delaware due to the lenient regulations there.
Why is this bad? It's what's known as a "race to the bottom." Clearly, the most deregulated insurance is going to be the least advantageous to potential customers, offering less coverage at higher costs. And don't forget -- the Republicans are endeavoring to roll back the federal-level consumer protections in the Affordable Care Act, either by repealing the ACA law itself, or by passing amendments that'd repeal individual regulations. Coupled with states where regulations are already loosey-goosey, it's a consumer nightmare.
Also, insurers are typically linked to networks of doctors. Now, under Trumpcare or Biglycare or Shittycare, insurers would either have to invest in establishing a single nationwide network or a collection of regional networks while keeping costs low, or they'd charge customers more to use out-of-network doctors. Either way, this doesn't lower costs as promised -- the opposite, in fact.
Worst of all, Trump's plan was already attempted in Georgia, Kentucky, Maine, Rhode Island, Washington and Wyoming where legislators tried removing restrictions against selling across state lines. Did it work? Of course not. In fact, none of the eligible insurance companies expanded beyond the respective states. Indeed, can it be called healthcare reform if exactly zero health insurers participate? Hell no.
What does Trump plan to do, then? Force companies to uproot and go national? I doubt the free marketeers in Congress, especially Ayn Rand disciple Paul Ryan, would mandate corporations to do anything along those lines. Consequently, Trump's grand replacement for Obamacare is probably a bust before it's ever implemented.
Repealing the ACA is a high wire act without a net. Cut the rope and 18 million Americans will lose their insurance within the first year alone, according to a new report from the Congressional Budget Office. What Trump and the GOP are calling for is a plan that's simply different rather than better. And that's the real catch here. They're not seeking to improve upon the ACA, obviously, they just want something that doesn't include Obama's signature on it -- perhaps the worst reason of all to risk the lives of millions of vulnerable Americans.