Unbiased Analysis of Today's Healthcare Issues

Do Republicans actually Like ObamaCare?

Written By: Jason Shafrin - May• 03•12

Joe Paduda has some interesting points:

requiring insurers accept all applicants is favored by most Republicans (according to Politico) but a) some senior Republicans hate the idea and b) there’s zero consensus re how to actually make that work. Do they forbid upcharging for older/sicker people? Adopt some form of risk-adjustment and/or financial transfer among/between insurers based on the risk profile of their members? Or allow the free market to operate, hoping that insurers will somehow figure out how to insure people with pre-existing conditions at affordable rates?

One option–an individual mandate–is certainly off the table for Republicans.  So the question is, if you want to prohibit insurers for varying premiums based on your health condition, how do you prevent premiums from skyrocketing or insurers acting illegally to avoid certain types of enrollees.  The answer to this question is not a simple one in the political realm.

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One Comment

  1. Mike says:

    Put another way, if you avoid upcharging for higher risks, you are putting a price control on the market. Price controls predictably produce shortages relative to what the market would otherwise provide. In this case, you induce a shortage of coverage on the market by limiting the price.

    If price controls are a necessity, you will need to introduce either subsidies, or rationing, or both. Since rationing health care is a dirty word, thanks to politicians, the ObamaCare solution is subsidies– provided by younger, healthier individuals who would be required to purchase and pay premiums far above the actuarial value of the coverage.

    Which gets us back to the individual mandate, something that seems to be widely opposed in the general populace, not just by republicans.

    Indeed, not a simple question.

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