The curate’s egg

The Post patiently explains to Trump why he can’t keep “the good parts” of Obamacare while throwing out the icky parts. It’s obvious, plus it was discussed endlessly, but the Post knows that Trump didn’t pay attention and is not quick on the uptake.

After reiterating his promise to repeal and replace the Affordable Care Act, President-elect Donald Trump has indicated that he may keep two of the law’s most popular provisions. One is straightforward enough — children up to the age of 26 being allowed to stay on their parents’ plan. The other — preventing insurance companies from denying coverage because of preexisting conditions — offers a perfect illustration of why Trump and most of the other Republicans critics of Obamacare don’t understand the health insurance market.

What’s wrong with this picture? If insurance companies can’t deny  coverage because of preexisting conditions, then what’s to stop people from skipping insurance altogether until they develop a Condition? And if that happened what’s to stop insurance companies from going into another line of work? Nothing. You have to pool the risk, one way or another. That means you have to mandate coverage, or you have to pay with taxes (Single Payer).

To guarantee that people with pre-existing conditions can get affordable health insurance, you need to have rules requiring guaranteed issue and community rating.  To keep insurance companies in business because of guaranteed issue and community rating, you need to have an individual mandate.  And because poor people can’t afford health insurance, you need subsidies. Combine all three, and what you have, in a nutshell, is … Obamacare.

Of course, if you want to scrap guaranteed issue, scrap community rating, scrap the individual mandate and scrap the subsidies, as Republicans, propose, then you end up where the country was in 2008—with a market system that inevitable gives way to an insurance spiral in which steadily rising premiums cause a steadily rising percentage of Americans without health insurance.

There are no easy solutions here, no free lunches.  You can’t have all the good parts of an unregulated insurance market (freedom to buy what you want, when you want, with market pricing) without the bad parts (steadily rising premiums and insurance that is unaffordable for people who are old and sick).

At the same time, you can’t have all the good parts of a socialized system (universal coverage at affordable prices) without freedom-reducing mandates and regulations and large doses of subsidies from some people to other people. Anyone who says otherwise – anyone promising better quality health care at lower cost with fewer regulations and lower taxes—is peddling hokum.

That would be Donnie from Queens.

The post included a very unfortunate photo of Donnie talking to an adult with the article. He does that ludicrous pinching gesture even when talking to an adult.

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