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2017-03-24

Trumpcare fails as Trump and Republicans cancel vote; Obamacare remains for now

by John S. James

Congressional Republicans cancelled a vote on the bill to repeal Obamacare, after it became clear that the replacement they proposed could not get enough votes to win.

The bill that failed was almost unanimously opposed by doctors' and other medical organizations - and then made worse to get votes of right-wing Republicans, upsetting moderate Republicans who otherwise would have voted for it. To reduce premiums, the final bill would have allowed health-insurance companies to offer policies without maternity care, emergency care, treatment for mental health or substance abuse disorders, prescription drugs, lab tests, rehabilitation, and four other "essential benefits" required by Obamacare. Many moderate Republicans could not vote for that.

For more news see GOP health-care bill: House Republican leaders abruptly pull their rewrite of the nation’s health-care law. You can also search for news on this (or any other recent news) at news.google.com.

Comment: What's Next

What's driving the problem is the excessive cost of U.S. health care - currently one sixth of the entire U.S. gross domestic product. The U.S. spends far more on healthcare per person than any other country in the world, but is currently #42 in life expectancy at birth (according to the CIA's list,
https://www.cia.gov/library/publications/the-world-factbook/rankorder/2102rank.html).

All the cost-reduction proposals we heard in the huge national debate leading up to the failed Trumpcare bill were either to deny healthcare to the poor, or to sell much-worse policies to the middle class. None dealt with the fundamental reason that U.S. healthcare costs so much.

The reason is that U.S. healthcare is dominated by corporations and individuals that are all about making money, whatever their mission statements may say. Almost all incentives in the system are to charge higher prices. Greed and fear work tolerably well for organizing a stock market; they don't work well for medicine.

For example, drug companies have huge biases toward developing only the most expensive therapies. New antibiotics are not a focus even though resistant infections kill many thousands of people each year in the U.S. alone. Why? Because antibiotics cure too quickly; the companies want drugs that need to be taken for years, ideally for life, so that more money can be extracted.

Combining unscrupulous, predatory, what-the-market-will-bear pricing, with the traditional ideology that human life is priceless, causes market prices to rise toward infinity (especially when there is no competition, due either to patent laws, or to regulatory logjams for generics) - not just drug prices but most prices throughout the complex, non-transparent medical system. Quite commonly one person's medical bills can be half a million dollars or more. Since almost nobody can pay that out of pocket (and they would have to pay extra-high prices if they did, since they don't have the negotiating power than insurance companies do), the idea is that almost everyone will be insured. There is little "market discipline" in this system; insurance companies usually pay if high-status doctors say it's needed. So prices go up and up while profiteers pocket the cash.

The real business model of health insurance is to find excuses not to pay for care - and also to get rid of expensive patients, one way or another (for example, automatic premium payments can go away automatically and silently at the end of the year). Despite their complaints about not being able to make money, health-insurance companies have been remarkably successful in recent years; see Gripes About Obamacare Aside, Health Insurers Are in a Profit Spiral.

And since the poor could not possibly pay the insurance premiums, co-pays, and deductibles, government pays for their care through Medicaid. This is what Republican want to get rid of - let the poor suffer and die without access to medical care. Or they can go to an emergency room when necessary to postpone death - which is not comprehensive medical care, and costs a median of $1,233 per visit (as of three years ago), according to a study by the National Institutes of Health,
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3584078/.

And more and more of the middle class can't pay for effective insurance either, as costs go up and up. So both political parties propose various subsidies to help them, but ultimately not enough.

The result in an extremely expensive system that burdens the middle class, the poor, and the taxpayers. It has become unsustainable.

But mainstream politicians have avoided the real causes of excessive costs and prices, since talking about this would threaten profiteers who fund their campaigns. So others must take the initiative to get these problems addressed.

If Republicans or Democrats want to help improve Obamacare, they can start by talking with healthcare professionals and finding proposals that working doctors and other health professionals can support. No more schemes that are almost unanimously opposed by the medical community, please.