End the Federal Monopoly on Health Care Regulation

Robert Laszewski may be the nation’s leading expert on President Obama’s health care law. He is skeptical of the claims made by both supporters and opponents of the law, and he offers an interesting take about the law’s role in the 2016 election: “Democrats can’t admit Obamacare is broken and Republicans can’t admit it won’t be repealed.”

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Laszewski is right on both counts, though the end result is probably a bigger problem for the Democrats than the GOP. The law has never become popular with voters, and it’s likely the election season will coincide with even more bad news of price hikes and struggling co-ops. For politicians, defending the law will be much harder than challenging it. Those who challenge the law, though, are handicapped by the lack of an alternative vision that makes sense.

The underlying problem for both parties is that neither Republicans nor Democrats in Washington can fix President Obama’s law. Their proposals are certain to fail because they are built upon official Washington’s strong commitment to top-down governance. The political class has convinced itself that wise men and women in the center of American politics should study issues and hand down rulings telling the rest of us how to live.

Replacing that mindset with a more realistic view is the most important step we can take towards fixing our health care system. A one size fits all federal government — top-down governance — does not make sense in the iPad era.

The more realistic mindset begins with a recognition that we live in a society where the culture leads and politicians lag behind. Change in healthcare, just like all other change in America, will be brought about by people far removed from the petty partisan politics of our nation’s capital.

Driving this change is a commonplace desire to lead a healthier life. This attitude reflects an enormous change from the health care industry’s focus on treating ailments rather than promoting health.

Fortunately, innovation is forcing this change on an industry that is comfortable with the status quo. Fitbit and scores of other new firms are helping us better monitor our health to prevent future problems. And that’s just the tip of the iceberg. As everyday Americans download apps, try new monitors and share their experiences, we’ll learn more about the best way to structure interaction between people, treatments, technology, and medical professionals.

This real world experience is completely missing when political leaders try to write the rules. To start tapping into all that knowledge and information, we should end the federal monopoly on rule making and let each state set their own standards. Some states might demand that every citizen has exactly the same coverage as President Obama’s team has mandated. Others might establish a much different minimum allowing for lower cost insurance.

The competition between states would give us a better understanding of the trade-offs between coverage levels and costs. Among other things, it would be fascinating to know how much coverage individual Americans would demand above the minimum. Perhaps even more important, it would provide opportunities for new approaches to be tried on a state-by-state basis rather than waiting for Washington to catch up.

Breaking up the federal monopoly on health care rule making is only a small step, but it’s a step in the right direction.

Also see,

Keeping the Presidential Election in Perspective

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