Saturday, January 14, 2017

GOP's "State Lines" Claim on Insurance Prices is Flawed

As the country braces for controversial changes to a controversial health care law, many American families are deeply concerned about the GOP making things worse and losing gains that have been made. Obviously, lowering health care costs is the primary and very necessary goal, and the "Affordable Care Act" has for the most part failed to accomplish that goal. And, there is simply no legitimate reason that health care and health insurance has to be so expensive - especially in a time of somewhat ridiculous revenue and profits for the health care industry. That said, the standard GOP call for "market reforms" and "consumer freedom" seem like rather naive and ambiguous plans and policies to alleviate the problems. I'm not going to disagree that "fixing health care requires the repeal of Obamacare," as argued by three Colorado congressmen.

And speaking of replacement plans, the narrative that Republicans have offered no plan to replace Obamacare is false. Republicans have introduced multiple alternative health care plans since 2010, and we encourage you to review them. The most recent replacement plan was offered by the Republican Study Committee, called the American Health Care Reform Act. The Empowering Patients First Act was a plan put forth in the 114th Congress by future Health and Human Services Secretary, Dr. Tom Price. Our Better Way Agenda also includes a blueprint for replacing Obamacare that is centered on more choices, lowers costs, and greater flexibility.

However, many of the claims and counterarguments and proposals by the GOP are simply ideological positions that have no proven benefit, and potentially troublesome effects. The biggest myth of GOP health care reform is the argument that allowing the purchase of policies across state lines will lower health care costs. Insurance prices are market-based, and companies will simply not sell a low-cost market policy to a higher cost market consumer. That's such basic business and economic knowledge that I wonder how GOP politicians and policy writers can continue to claim otherwise with a straight face. They are either ideologically naive, or they are simply lying. The question voters have failed to ask is why. As Bruce Japsen explains for Forbes magazine, "Selling Insurance Across State Lines Won't Lower Costs."

“Currently individual states can decide whether or not to allow insurers to sell plans from another state in their state,” the Center for Health & Economy wrote about Trump’s health plan earlier this year. “However, even where this is allowed, various barriers such as the difficulty of building a network and attracting enough customers to create a large enough risk pool make it unappealing to insurers to pursue this option.”

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