Presidential candidate’s polarized positions culminate on health care
Published: Wednesday, October 31, 2012
Updated: Wednesday, October 31, 2012 01:10
President Barack Obama and Republican presidential candidate Mitt Romney both agree that the health care system has problems, but each candidate has his own ideas on how to improve the system.
Health care reform is a complicated issue and a high-priority topic in the presidential election.
Laura Dague, a professor at the Bush School who specializes in health care policy, said Americans need to understand the problems of the health care system to evaluate the candidates’ plans.
“There are really two big issues that the U.S. faces with respect to health care policy,” Dague said. “One of them is that we have a lot of people who do not have access to the health care system. The second problem is that costs of health care are increasing at a high rate.”
Dague said customers who want insurance the most are also those who need it the most, so they will be the most expensive to insure. This problem is called “adverse selection” and is one contributing factor to why it is expensive to buy insurance on the individual market.
“Economic policy says we can make it cheaper, require it or give it away,” Dague said. “Unfortunately, the cost problem is really hard to fix.”
Dague said part of the problem with the high cost of health care comes from uninsured people who can’t pay hospital bills and the hospital having to cover the cost.
“The idea is that somebody has to pay for people who get sick when they are uninsured,” Dague said.
Public emergency rooms have to treat anyone who walks in the door. When uninsured people cannot pay for care, the hospital or a charity organization gets stuck with the bill, Dague said.
The Affordable Care Act, referred to as Obamacare, is the Obama administration’s health care plan that has been initiated.
According to Obama’s campaign website, Obamacare is “making health care work better for all of us, even if you already have insurance. It puts the health of your family first — ensuring access to free preventive care and protecting consumers from insurance company abuses.”
Dague said the Affordable Care Act can be broken down into four main points: increased coverage, state-based exchanges, insurance offered by employers and an insurance mandate.
“Its main goal is increasing coverage,” Dague said. “One way it does that is it takes the program for poor Americans, Medicaid, and it extends Medicaid from current requirements to 133 percent of the federal poverty line, which is around $22,000 for a family of four.”
The act also creates provisions for state-based insurance exchanges, which Dague said could be implemented as an online system where individuals can browse private insurance plans that meet federal requirements.
“This [exchange] is definitely not intended to be owned by the government,” Dague said. “It is supposed to be administered by the state governments.”
She said the Act also requires employers with more than 50 employees to offer insurance or pay a penalty, and that everyone must get insurance.
“To deal with adverse selection, there is an insurance mandate that says everyone has to get insurance,” Dague said. “This is definitely theoretically necessary in order to solve for the adverse selection problem. The bigger pool, the better off you’re going to be.”
A provision of the act that affects students requires that insurers allow parents to keep dependents on their insurance plan until the age of 26. Dague said there is already research that shows uninsured rates among young adults has decreased because of the provision.
Romney’s plan is to repeal Obamacare.
According to his campaign website, he will issue an executive order that paves the way for the federal government to issue Obamacare waivers to all 50 states. He will then work with Congress to repeal the full legislation as quickly as possible.
Dague said Romney plans to replace Medicare with a system of private plans where the beneficiaries get a check from the government to purchase a plan.
“We don’t know exactly how much this check will be,” Dague said. “Many people worry that if costs continued to go up, this check may not cover everything.”
Romney wants to keep the popular provisions in the Affordable Care Act, such as the provision to keep dependent children on their parent’s plans until they are 26 and allow states to implement their own plans.
Students such as Patricia Arruda, graduate student at the Bush School, are in favor of Obamacare.
“The bill is more than ‘free health care,’” she said. “It sets standards for care providers, it increases transparency between those companies and consumers and it's a chance to put consumers in charge of their health care.”
Hunter Testerman, junior economics major, said he is opposed to Obamacare as a matter of principle.
“The primary reason I oppose of [Obamacare] is I feel that the resulting financial consequences could very well be more harmful to our society than the health care it would provide for the uninsured,” Testerman said. “I also oppose the idea of the government essentially forcing individuals to buy insurance.”
When evaluating policies, Dague said students should understand that all government spending is a trade-off.
“All government spending represents a trade-off between things we want and things we can afford,” Dague said. “How you feel about these things depends on where you fall within that spectrum.”