Update: Now that it appears he’s ending subsidies for insurers, there may be light at the end of the tunnel after all. The two big problems with his first executive order still stand, but if this is the first in a series of executive orders that end up forcing Congress to act, I may end up liking what he’s doing. It’s a longshot, but it’s possible…
One thing I truly don’t like is when people are ungracious winners. When we get our way and then complain because the result wasn’t exactly what we hoped or the results weren’t as great as we expected, that’s petty in my humble opinion. With that said, I’m about to do that. I’m going to complain about the executive order the President made Thursday that seems like a win on the surface but is actually a major problem for most Americans.
I’m 100% in favor of allowing businesses and individuals to shop for insurance across state lines (though this EO doesn’t quite do that, but that’s another story) and I love association health plans. Both are important components of a free-market health insurance system devoid of federal government involvement and properly regulated in a very limited way by state oversight.
In the previous sentence, I left the caveat. Did you catch it? This only works in a “free-market health insurance system,” and today we don’t have one. We still have Obamacare.
Here’s one of the biggest problem with the executive order. It doesn’t release the market enough to add competition in a meaningful way. Therefore, premiums are going to go up as a result of this executive order. Why? Because the people who will be taking the most advantage of the executive order are the lower-risk insured people who are restraining premiums from rising even faster than they already are. That’s a problem.
What we need is a health insurance system overhaul that DOES NOT include federal interaction. DC needs to be completely out of the health insurance industry altogether. They need to open it up all the way for competition and free market principles to take effect. Consumers need to be the driving force, otherwise premiums are going to continue to rise. This isn’t some half-baked, biased opinion. Those with understanding of the situation on both sides of the political aisle know premiums are going to rise because it’s very simple math. If you remove the most profitable “customers” for the insurance companies- the low-risk, limited-use insured – you have to make it up with higher premiums to account for the mandated high-risk customers.
The other major issue is that it’s an executive order. While Presidents Obama and Trump seem to love legislating with their pens, these executive orders are easy to reverse. More importantly, they put the onus of fulfillment on the executive branch which means unelected bureaucrats are the power behind the decrees. This, too, is a problem.
Shannon Joy had a nice writeup that goes into more detail about all of this on Facebook:
If we are going to fix the healthcare system, it must be done through legislation and it must not be done piecemeal. We need a full repeal and followup legislation that puts the federal government as the last line of defense for those who absolutely cannot be helped otherwise rather than their current position as being the tip of the spear.