Two medical stories are headlined in recent Oregon newspapers. One is local, but with national implications. The other is national, but with local implications. A common denominator lies beneath both stories.
In Oregon more than ten thousand people got inflated tax credits when buying insurance through the exchange set up under Obamacare. The excess credits may exceed $100 per month, so some people will have to pay substantial amounts back to the federal government.
The national news is the death of Thomas Duncan from Ebola and the infection of several people who treated him. Duncan was sent home, when he first visited a Dallas hospital’s emergency room, despite highly suspicious symptoms. After giving conflicting answers to embarrassing questions raised by this situation, the hospital has hired a public relations firm and allegedly has prohibited staff members from talking to the press.
Obamacare may have been a step in the right direction, but a common denominator underlying both of these stories is its inadequacy and poor design. Partly due to refusal by many states (including Texas) to expand Medicaid, tens of millions remain uninsured. And Obamacare excluded coverage for foreign visitors and undocumented aliens.
Thomas Duncan, visiting from Liberia, had no insurance. There is informed speculation that the Texas hospital had a policy of not admitting emergency room patients who lack insurance. If this is true, it is no wonder that the hospital would need to hire a P.R. firm and put a gag rule on its employees.
Obamacare’s basic problem is complexity. Complexity made creation of web-based portals very difficult, and complexity forces individuals and employers to make choices they are poorly equipped to make. Much of this complexity flows from government subsidies, which allow people to purchase insurance, and especially from the need to document and monitor each person’s continuing eligibility.
Subsidies are obviously needed. Otherwise poor people who aren’t eligible for Medicaid would be unable to comply with the Obamacare mandate. And it is obvious that the subsidy for each individual needs to be on a sliding scale based on that individual’s income. But incomes can change, thus changing how much subsidy someone is entitled to and sometimes causing loss of all eligibility. Furthermore, as people’s changing fortunes move them in and out of Medicaid, the doctors who are “in-network” for them can change, forcing them to find new providers.
All of these problems---the need to reimburse the government for excessive tax-credits, the “churn” as people drop in and out of eligibility for subsidies or for Medicaid, the lack of universal coverage which may have started an Ebola epidemic in the U.S.---could have been avoided by enactment of a single-payer insurance system covering all people in the U.S. and financed by general taxes.
If Mr. Duncan had been covered by such an insurance system, he might well be alive today and he might not have exposed so many other people to Ebola.
Under a single-payer system people would still receive implicit subsidies based on their income, but this would be taken care of by the existing income tax system under which lower income people pay less tax and higher income people pay more. The Supreme Court’s highly dubious reasoning by which it allowed states to opt-out of Medicaid expansion would become irrelevant, since with universal coverage Medicaid would no longer be needed. There would no longer be doctors who are “in-network” or “out-of network.”
A single-payer insurance system would not solve all our problems, but the problems with Obamacare and the even bigger problems prior to Obamacare suggest we need to enact one as soon as possible.
This op-ed has run in The Lund Report.