The Republican Party and the Healthcare Debacle

Michael F Schundler
Aug 9, 2017 · 3 min read

The failure of Republicans to pass health care legislation should not come as a surprise. The Republican party is divided on health care for good reason.

The first issue is whether or not every American should have access to health care regardless of their income and health status. In other words, has health care become a “right”. My sense is that over half of Congress believes this to be the case. Since more than half of Congress are Republicans, it means enough Republicans support his position, that legislation that does not achieve this goal is going to fail. In simple terms, health care legislation must address affordability of health care to the poor and those with serious medical conditions or it won’t pass.

For those that do not believe health care is a “right”, the second issue is not relevant, but while more than 50% of Congress does believe its a right, the Republicans and Democrats cannot agree on how to achieve this goal.

For those Republicans that embrace “universal” health care, they mostly see it as letting the states figure out how to provide in the best way for their state’s sick and poor given each state’s health care system and then providing some Federal funding to make it affordable. This initiative is usually combined with Federal tax credits to help those that individually pay for their health care to enjoy the same tax advantages as those that get health care from the workplace.

For Democrats “universal” health care usually translates into either a true “single” payer system or something akin to a single payer system for those not covered by an employer health plan. When looked at from this perspective, it becomes pretty clear, that getting consensus from Congress either on a bi-partisan basis or with Republican majority is going to be difficult if not impossible.

The only problem is that doing nothing is not a very attractive option, since as designed the ACA is a train wreck already starting to happen and the damage will continue to escalate until the cries for reform become deafening. However, it is important for all Americans to understand two things before jumping to any proposed solutions.

First, a single payer system as practiced in European countries achieves its cost advantage primarily by forcing providers to take low reimbursement rates, the actual health care utilization rates in countries like France is higher than the US… and so price is the weapon of choice by single payer systems to control health care costs. But pricing is far more severe in these systems than would be necessary in our country if we had some of the advantages a free market system provides.

Second, while the free market system is failing to hold down health care pricing in America as a whole (there are plenty of examples of the free market working, but few that really impact the total cost of care in this country), it is doing or has done in the past a good job in other areas.. so why throw out the baby with the bath water… a Federal fair pricing reimbursement system for all health care products and services would achieve the pricing advantage of a single payer system, while preserving competition in areas like utilization management, benefit design, health outcomes, and a host of other features that suffer under a single payer system.

So perhaps the majority of Congress could find that a bipartisan solution that captures the benefits of a single payer system within a more diverse payer system could be the best of both worlds and a better option than waiting around for the ACA to hit the skids. The provider community will fight this tooth and nail, but eventually the rising prices of health care products and services will need to be controlled or health care costs in total will never be controlled. So in the face of this inevitability, should we wait until our health care system starts to crush our economy or act sooner and so with less pain for all?