What To Do When Obamacare Unravels

Over Christmas there was a great Opinion piece in the Wall-Street Journal that fleshes out what I’ve been dancing around for a couple of years now.

The real way we will make our US healthcare system better is by moving it closer to a Free Market model and that means moving us away from employer provided group plans and toward individual plans.

Here are three paragraphs that should get you excited enough to not only read the whole thing but also write your Congressional representatives.

Health insurance should be individual, portable across jobs, states and providers; lifelong and guaranteed-renewable, meaning you have the right to continue with no unexpected increase in premiums if you get sick. Insurance should protect wealth against large, unforeseen, necessary expenses, rather than be a wildly inefficient payment plan for routine expenses.

People want to buy this insurance, and companies want to sell it. It would be far cheaper, and would solve the pre-existing conditions problem. We do not have such health insurance only because it was regulated out of existence. Businesses cannot establish or contribute to portable individual policies, or employees would have to pay taxes. So businesses only offer group plans. Knowing they will abandon individual insurance when they get a job, and without cross-state portability, there is little reason for young people to invest in lifelong, portable health insurance. Mandated coverage, pressure against full risk rating, and a dysfunctional cash market did the rest.

Rather than a mandate for employer-based groups, we should transition to fully individual-based health insurance. Allow national individual insurance offered and sold to anyone, anywhere, without the tangled mess of state mandates and regulations. Allow employers to contribute to individual insurance at least on an even basis with group plans. Current group plans can convert to individual plans, at once or as people leave. Since all members in a group convert, there is no adverse selection of sicker people.

What a novel idea – Let individuals decide what insurance plans are right for them and then watch as insurance companies adjust their policy offerings to meet the demands of the Market.

This plan makes so much sense that Washington DC won’t do it unless we start a grassroots movement to force them.

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