Trump Needs to Pick Staff Who Will Stop ObamaCare

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In response to reports that President-elect Trump and congressional Republicans might consider reneging on their promise to repeal ObamaCare, the Association of American Physicians and Surgeons (AAPS) issued the following statement:

ObamaCare is a complicated net of provisions that pay off interlocking special interest groups. Despite Nancy Pelosi’s comment that we had to pass it to find out what is in it, Americans still aren’t aware of its many far-reaching tentacles.

It is not possible to get rid of kudzu by trimming a few branches. It is not possible to drain a swamp by diverting part of the water. It is not possible to save American medicine by relieving a little pressure while leaving the apparatus for crushing it intact.

Lesser-known provisions that need to go include the half a trillion dollars in tax hikes, the ban on the expansion of physician-owned hospitals (which often provide better and less expensive care), and the “antidiscrimination rule” that requires everyone to pay for and most facilities to provide costly “gender reassignment” procedures. More and more harmful effects are evident as taxes and regulations are phased in.

The major reason for shocking premium increases and plan cancellations is the federal mandates on coverage and pricing.

The main outcry about repeal is that “millions of Americans would lose healthcare.” Actually, millions would lose taxpayer subsidies for outrageously expensive premiums—which result from ObamaCare. How many would lose Medicaid, the main source of expanded coverage, depends on the states. For problems that arise, there are state or targeted solutions that do not destroy private, voluntary insurance or the fabric of our medical institutions.

The replacement for ObamaCare is not TrumpCare or RyanCare or RomneyCare or another coercive centrally planned system—but freedom. Freedom is what brought unprecedented prosperity and medical advances to unprecedented numbers of people.

Without freedom, America will never be great again.

The Association of American Physicians and Surgeons (AAPS) is a national organization representing physicians in virtually all specialties and every state. Founded in 1943, AAPS has the motto “omnia pro aegroto,” which means “all for the patient.”

Additional Resources: 

Preserving American medicine: an outline from AAPS

Common Sense Medicine: Restoring the Patient/Physician Relationship

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  • Freedom indeed. As a staunch advocate of free-market solutions for healthcare, I believe there is much we can do to facilitate freedom of choice in healthcare, improve quality, lower costs and enhance the doctor-patient relationship. But the simple absence of ObamaCare is not the end-game nor will it correct the problems that existed prior to the ACA. Thus, the cries for “repeal AND replace”. But “ObamaCare light” is not good enough.

    Any Republican/Trump plan that disrupts coverage for those currently getting policies as result of premium support subsidies will be politicized and unpopular; and rightly so, since there several alternatives ways to perverse coverage as we transition to another system. Likewise, any plan that returns the individual market to the way it was pre-ACA is not likely to pass congress.

    A good pro-market and pro-liberty health system must address a handful of important issues and conundrums that existed before the ACA was adopted into law; and which the ACA did a poor job of correcting. These range from laws about physician ownership to Medicare & Medicaid reform and even HITECH.

    A fundamental flaw that has plagued the U.S. healthcare system is the perpetual problem of interrupted coverage and job-lock. The ACA failed miserably to fix this, if it ever even attempted to.

    These two sides of the same coin are a direct result of tax laws which tilt the incentive overwhelmingly in favor of employer-sponsored coverage with a bias against the individual market. It is the reason COBRA exists (and if you’ve ever had to pay COBRA premiums, you realize the acronym is appropriate). Currently, a cascade of perverse financial & economic consequences result from the fact that we have unlimited tax exempt health benefits which create, among other things, an incentive to over-buy and over-consume medical services with zero regard to costs. Ever increasing premiums, and the bubble effect caused by the way we access and bill services, has contributed mightily to wage stagnation and it crowds out more and more items in our budgets every year. Healthcare costs have been rising at twice the rate of real wages on average for about 25 years. This is even more meaningful when we consider that economists generally agree that benefits such as healthcare equate to a dollar-for-dollar reduction in gross monetary wages.

    The issue of adverse selection has only worsened under ObamaCare. The incentive for insurers to avoid the sick and attract the healthy is more lopsided than ever. The entire way the risk corridors were constructed a schizophrenic approach to this issue. As more benefits are forced into health plans, combined with guaranteed issue and mandated payout ratios, the only way to attract the healthy is to keep premiums down. This usually is accomplished by limiting network size and raising deductibles. The healthy buy on price, the sick buy on benefits. Our current system fights against this obvious fact of behavioral economics in which individuals act in their own self-interests.

    The issue of pre-existing conditions is so politically charged, and guaranteed issue so popular, that careful attention will have to be given to any pro-market plan with regard to this problem. One good solution is that of Change of Health Status Coverage, as written about by John Cochrane. So instead of pretending that newly diagnosed conditions don’t carry a financial consequence, Change of Status coverage provides a financial vehicle to account for this.

    Another huge issue is the subsidy system. Our society has tacitly declared that it places a high value on providing medical care for those that can’t afford it. Billions are already spent on entitlements in the form of Medicaid, S-CHIPs and premium support. Now a case can be made that with proper reforms premiums will deflate and become affordable again. But this won’t happen over-night. Any plan must maintain a safety net and hopefully improve on it. Currently, the subsidy system is grossly unfair and highly complex. The amount of help, in the form of direct payments or indirect tax relief, that the government gives people in similar income ranges varies greatly depending on their tax filing status and where they purchase their insurance. And calculating the correct amount of subsidy is almost never accurate, resulting in a high percentage that have to repay part or all of it each year. A good plan would provide the same level of help to everyone regardless of filing status, where they work or where they purchase insurance. This can be summarized by the notion that money should follow people, not insurance companies.

    Expanding the scope and role of Health Savings Accounts is long over-due, but its effect will be modest if we don’t address the perversions in our payment system that have turned healthcare into an inflation machine; a veritable economic bubble. Our billing and payment system has created a situation where billed charges don’t perform the crucial role that prices would normally have in a healthy market; due to the lack of transparency and inability to have prices known in advance, they do not send correct signals between buyers and sellers. The other oddity that causes prices to go higher and higher is the absence of a non-insurance market for routine care and routine services (other than DPC and some cash providers). Everything must be ran through the CPT billing protocols for reimbursement. This is a very costly and inefficient way to pay for care. Paying for more things directly without an intermediary will result in lower prices eventually, but it doesn’t do any good if those HSA dollars “see” inflated CPT billed charges; they simply won’t go far enough to bend the cost curve.

    The good news is, there is a plan based on the work of John C. Goodman that I believe has a better than average chance of passing and becoming the “repeal and replace” option that many have hoped for. It is the Sessions-Cassidy bill. It fixes the two worst problems with the ACA: an impossible mandate and a unworkable subsidy system. Many will object because it does not repeal all of the taxes associated with ObamaCare. But it is unlikely we can maintain the level of coverage we have now without some of those dollars. My hope is that we can put sunset clauses on some of those taxes.

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