Congress, Issues, Obamacare

Repealing Obamacare Is Just the Start: How to Fix American Health Care, Part 1

Image: CC0

Image: CC0

Obamacare, the left’s grand attempt to create a national government-run health care system, has failed.

They promised lower health insurance premiums, but delivered higher ones. They promised more choice and competition, but delivered less. They promised continuity and better access to care, but delivered disruption and dislocation.

Despite promises that people could keep their plans and doctors, thousands of Americans were forced into more expensive insurance with higher deductibles and plans that didn’t include their doctors.

After spending billions in tax dollars, Obamacare managed to increase the number of people with health insurance by much less than predicted—with over 80 percent of even that increase the result of simply enrolling more people in Medicaid. So far, the net growth in private health insurance has been only about 3 million people—or less than 1 percent of the population.

In the meantime, Republicans won—first the House, then the Senate, and finally the presidency—by campaigning to repeal Obamacare.

Now, those who created the mess have the audacity to insist that Republicans not repeal Obamacare until they first put in place a new comprehensive, national design for America’s health care system. Unfortunately, some Republicans seem to be listening to them.

Yet those demands reveal a fundamental ignorance of how to achieve more choices, higher quality, and lower costs for any product or service.

Perhaps they should take a look at the history books.

By the end of the 1970s, Japan, once known for its cheap trinkets and poor product quality, was overtaking the U.S. automobile and manufacturing industries in terms of quality, efficiency, and costs. That was largely due to the business practices revolution led by Edward Deming, an American management consultant who went to Japan after World War II to rebuild its infrastructure.

Deming’s message was that companies could become successful by prioritizing quality above quotas, and bottom-up observations about efficiency from the factory floor in place of top-down edicts from the boardroom. Japanese corporations listened, improved, and grew.

In contrast, manufacturers in the U.S.—even during the “golden age” of American assembly-line production—were not keen to listen to their customers’ complaints, nor to their workers’ ideas for improving quality and lowering costs.

It was not until the 1980s—when they were clearly losing out to Toyota and Honda—that companies like Ford finally reached out to Deming to learn the same lessons and instigate their own “quality revolution.”

This tale of two countries offers an important lesson for lawmakers in how to best reform the massive government programs that attempt to centrally manage services like health care and education for over 300 million Americans.

The private sector quality revolution happened when businesses pushed decision-making down to the shop floor and challenged workers to continuously improve how products were produced. Workers quickly began to make changes that would save seconds and pennies. Step by step, those seconds and pennies turned into minutes and dollars, and then into days and millions of dollars.

Once managers understood that quality improvement and costs reduction must be achieved incrementally, at the lowest levels of decision-making, the United States again became a beacon of manufacturing quality and efficiency.

Just like the American companies that lost market share when they refused to innovate, establishment politicians have lost elections because they ignored the outrage of Americans over the high costs and low quality of big government services.

The answer is not to replace one top-down centralized plan with a different top-down centralized plan. Rather, the solution lies in clearing out the web of government regulations and subsidies that shield the status quo from the kind of bottom-up innovation that produces better quality at lower cost.

It’s important to remember that the health care system was already over-regulated, inefficient, and needlessly expensive before Obamacare made all of those problems worse.

Consequently, repealing Obamacare is just the starting point, and clearing away the obstacles to innovative, bottom-up health reform will be a longer-term process, not a one-time event.

Tomorrow, in part two, we’ll explore what health care should look like in a world without Obamacare.

Commentary by Jim DeMint, the Daily Signal

  • Sharon Holmes

    Healthcare was not broken before the ACA. I was selling health insurance for a company by the name of United American for years, and their policies were good in 50 states and with any doctor without a referral. The only limitation was that I had to be licensed in the state where i sold insurance, so i could not sell policies to family members who lived outside that area. But there were things that needed to change. People who are classed as un-insurable needed to have a government catastrophic coverage for that condition only. As an example, in 2004 I had “brain surgery’ an un-insurable event, due to a bleeding tumor in my forehead, probably caused by the radioactive fallout on Las Vegas in the 1950-60’s from the above ground testing at the Nevada test Site, just 60 miles away. So, i was un-insurabe for the rest of my life until i was old enough for Medicare because of a once in a lifetime medical procedure. Needless to say, it never happened again, but if there had been expanded coverage through Medicaid for only another brain surgery, and United American had covered everything else, i would have had excellent care available in all 50 states for anything medical, and for the last 12 years it would not have cost the taxpayers a dime. Nor would it have cost United American anything nor would they have had to risk another occurrence. Now, for chronic diseases, like Muscular Dystrophy there would be on-going medical costs, that would have to come under that Medicaid program, but a simple and inexpensive health insurance could cover everything else. When the ACA came along, it cost more in Arizona than my Social Security is, so I stayed without regular insurance for many years, till I was old enough for Medicare, so was covered once again. I also think parents should have the OPTION of keeping their children covered until age 25, since many children are in college until that age. And as for prescription cost, we all know how much cheaper the same drugs are in Mexico or any other country, so that also needs to be fixed so that people can afford their medications. I constantly found people who had been cancelled by their insurance company after they had a significant surgery or were diagnosed with something, whereas UA could not cancel a policy after it was issued, except for non-payment. That was also important.

    • Texas Belle

      Right on. Members of my family are now paying $21,000/yr for premiums with $6600 deductible each. They seldom reach the deductible so what they have is actually just catastrophic coverage; the routine medical care they still have to pay for. The cost of a recent visit to the emergency room by one of the family was $7000 which they had to pay out of pocket, plus extra costs by the Doctor who was not in the group coverage. It is insane and detrimental to the public health. John Roberts is responsible for this mess when he declared the ACA was actually a tax and could be imposed and mandated by the Government. Hopefully we will get some new Supreme Court Judges during the Trump Administration who will act within the Constitution instead of acting on their “feelings”.

  • Texas Belle

    Every policy that Government touches quickly results in fraud, higher prices and less quality, i.e. ACA. Nothing about it is affordable except for those who receive subsidies which are paid for by the middle class, which results in no health care for them because the deductibles are so high that they rarely reach them in any given year. They have to pay out of pocket for routine care while those who are subsidized get almost free care. That is called “transfer of wealth” scheme, and it is bankrupting the middle class, who will soon need subsidies themselves. That means only the rich “elites” benefit from this outrageous act of the Democrats.

  • MarcJ

    Since it was communist-inspired I renamed the Affordable Care Act or ACA as Caca.

  • carmella

    Healthcare should not be a for profit industry.

    • jerry1944

      Do you know of anyone that works for free .That what obambo tells doctors is why so many stopped taking medicare

      • carmella

        I’m not talking about doctors. I’m talking about insurance companies that must please shareholders.

        • jerry1944

          The same thing . Who want to have a company that doesnt make a profit .Now i do kind of see a little on the drug companys But if they to didnt make money they wouldnt invest in new drugs But i do think they pay some for reseach that they now will never find a drug to cure anything

  • jerry1944

    It worked ok before the dems screwed it up Now those working to pay there ins has also to pay for others that get compencated for low ins. and the cost goes up for all Paper work had doctors having to hire more ppl to handel it. But what is scary is so many in the rep party think there are so many good parts to obambo care And we know dams like mc cain graham , ryan and the boys will shaft us in a hurry

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