Last week I ranted about the Affordable Care Act’s failure to actually create affordable health care—for startups, freelancers or anyone else who doesn’t work for a big employer.
Today, I reveal my one-step strategy for making sure every American has health insurance. My plan will outrage critics on both the left and the right, which should tell you right away it’s a sound approach.
Ready? Here it comes:
The Federal government guarantees that American families never have to spend more than 10% of their annual income on healthcare. Period.
From the right: Are you nuts? That creates a new, staggeringly expensive entitlement that will turn the United States into Greece!
My response: You’re half right. It will be staggeringly expensive. But it will energize our economy, not cripple it.
From the left: Are you bonkers? That leaves hard-working American families exposed to big medical expenses!
My response: As opposed to now?
STIMULATED LIKE NEVER BEFORE
My plan will cost the government approximately $100 gazillion every year. But there’s no way to protect all Americans that won’t cost a bundle, and leaving millions uninsured isn’t a free ride, either. My plan, however, creates immediate, positive side-effects:
- It encourages entrepreneurship, by removing the specter of higher premiums that people pay when they leave their corporate jobs—a long overdue boost for the startups and small businesses that create the biggest share of our economy’s net job growth.
- It slashes the cost of employer-provided health insurance, by covering all claims over 10% of income. Premiums will plunge. Companies will steer those savings toward higher salaries, capital improvements, or straight to the bottom line.
Well, the Bush-era tax rebates and Obama’s first-term stimulus package certainly proved that. But my plan isn’t just a stimulus—it’s the fairest, most transformative healthcare reform possible.
THE END OF HEALTH INSURANCE AS WE KNOW IT
I can already hear the groaning. Did he say “fair?” Heavens! A family making $50,000 a year might have to pay $5000 a year for healthcare!
Well, yes. But guess what? Some 17.7 million freelancers, contractors and other independents—13% of all working Americans—already face that risk. In fact, we pay budget-crippling premiums for the privilege. Or we go without insurance altogether.
In contrast, my plan is the definition of fairness—every American family gets the same protection relative to their income.
Of course, if you (or your employer) want to keep paying for a comprehensive health plan that covers 80% of everyday medical costs, no one is going to stop you. But without the threat of financial doom, my guess is that you’ll soon realize health insurance as we now know it is a waste of money.
I’ll say it again. Health insurance as we now know it is a waste of money.
Honestly, a comprehensive health plan isn’t insurance at all.It’s more like the extended warranty Best Buy tries to sell you on your laptop. You pay up front to cover the potential costs of routine maintenance or product malfunction down the road. It’s a sucker’s bet.
True health insurance doesn’t pay for basic medical costs, any more than car insurance covers oil changes or brake replacements. Insurance is for worst-case scenarios.
My plan gives every American true health insurance—a guarantee that a serious accident or devastating illness won’t bankrupt them.
ALL THAT, AND COST-CONTAINMENT TOO
So that’s the deal—a giant new government entitlement that:
- Protects all Americans from financial ruin in a medical emergency.
- Encourages the foundation of startups and other new businesses, like the ones that have created virtually all the net job growth in this country over the last 30 years.
- Removes the unfair self-employment penalty on health insurance premiums.
- Slashes employers’ healthcare costs, boosting productivity and profits.
- Ends health insurance as we know it.
Oh, and one more thing. As more Americans leave comprehensive health plans and start paying out-of-pocket for basic medical expenses, my plan:
- Reins in healthcare costs with competitive pressure, by exposing more Americans to the true costs of medical goods and services.
How will the plan be administered? How will we pay for it? I’ll leave those answers to the policy wonks in Washington. Or maybe to the editors at National Affairs, who wrote this in their Fall, 2012 issue:
“A sensible and affordable health-insurance system would thus be based on universal catastrophic coverage. The federal government could actually provide it to every one of the 209 million Americans who are not already covered by public insurance, and at a cost far lower than that of the Affordable Care Act.”