When it comes to government policies, we seldom see initiatives looking into undoing what has been done.
As the health care bill supported by President Donald Trump makes its way to the Senate after being passed by the House of Representatives, many remind the public that the bill isn’t ideal. Not because it doesn’t bring a complete end to the Affordable Care Act, or Obamacare, as we know it. But instead, critics suggest that the new proposals simply do not go far enough by not bringing an end to the federal government’s involvement with the health insurance business.
Government officials have, for the most part, created a rise in health care costs by trying to address the consequences of their policies by enacting more restrictions and regulations.
By selectively intervening in the health care market, government generates more unanticipated difficulties, as economist Ludwig von Mises once wrote. As politicians are pressed to “do something” to address the issues brought up by intervention, they come up with new interventionist policies, thus never bringing an end government’s involvement in the business of providing care.
A perfect example of an unintended consequence caused by further meddling with the health insurance industry is Aetna’s recent decision to pull out completely from the Obamacare individual market for 2018.
According to the company, its participation in the Obamacare exchange is costing them money. More precisely, the company is projected to lose around $225 million this year. In 2014 through 2016, Aetna lost $700 million from its exchange plan businesses.
Some of the issues that have been to blame for these losses include a poor balance between sick and healthy customers purchasing plans through the exchange. As a result, premium rates have gone up 25 percent this year, forcing more Americans to remain uninsured, proving that every time the government gets involved with health policy, it stifles choice, hurting those who need the care the most: the patient.
Another problem caused by government’s requirements concerning mandatory insurance purchase is the lack of access to actual care.
As the insured notice that it becomes ever more expensive to have access to doctors because of the high co-pays, they fail to seek the care they require.
Seeing this trend and feeling the pressure to see more patients for less cash, many doctors have decided to skip the nightmare altogether by leaving the insurance market and by offering personalized care instead. The movement has prompted a series of doctors to turn to direct primary care for the solution, offering patients care in privately-run clinics in exchange for a monthly payment that often pales in comparison to what an individual would pay an insurance company.
By saying no to insurers, these doctors and patients are also saying no to suffocating regulations.
Perhaps, if more of these businesses are launched, health insurance companies as we know them will become obsolete, forcing the government to finally step away from messing with healthcare policy altogether.