There has been considerable debate among conservative opponents of Obamacare over proposed federal legislation that would fund high-risk pools for people with expensive pre-existing health conditions. In a column at e21 I explain why and how the federal government should help protect people with pre-existing conditions by funding high-risk pools.
Some opponents of this legislation have in mind the possibility that the problem of pre-existing conditions can be resolved with deregulation and a more functioning marketplace for health insurance. And it is certainly true that the problem is caused — in part — by the favorable tax treatment granted to employer-paid insurance premiums. This encourages heavy reliance on job-based insurance that is not owned or controlled by the workers, and can’t be taken with them when they leave their jobs. The discontinuity in insurance coverage that therefore occurs in the United States compels a regulatory solution to ensure that workers who switch insurance do so without incurring significant financial risks. We would be far better off if the market for private health insurance had developed differently, with individuals purchasing and owning their coverage more, as they do with most other insurance products.
But there’s no sense in ignoring reality. Today, about 160 million Americans are enrolled in job-based insurance plans, and mainly they are satisfied with what they have. If Obamacare is repealed, there’s little prospect of wholesale change to this insurance system. Therefore, opponents of Obamacare need to promote solutions for pre-existing conditions that presume the continuation of job-based insurance as the dominant form of coverage.
You can read the rest of the column here.