American Healthcare: A Problem of Lilliputian Proportions

If 2016 demonstrates anything, it demonstrates that the politicking in America has entered a post-policy era. It’s Who’s Line is it Anyway, where the rules are made up and the points don’t matter. But barring a Purge style post-apocalyptic scenario -and yes, I know the clowns in the streets make it seem ever more likely- we will have a new President on November 8th. That means real policy changes will happen. Policy that will affect America and the World on a grand scale. Policy that directly affects our communities, our health, and our careers as healthcare providers. I aim to debride the vegetation growing on the heart of the American political scene and discuss what might happen when that new President takes office…

I will discuss each of the candidate’s healthcare philosophies, their biggest healthcare changes, and I will speculate a bit towards the future under each plan. Full disclosure: many of you have more expertise than I do in this area. I will be the first to admit I probably got quite a lot wrong. I encourage you to politely share your thoughts with me privately-my email is mawright@mcw.edu. All I hope to do is open up the conversation, set aside the fearmongering, and talk about the next steps for American health care. I apologize in advance as if you were trying to find your 100% your daily recommended dose of snark in this essay, look elsewhere.

I’m sure by now it is patently clear that America spends more on healthcare than any other country (roughly $3.0 trillion dollars in 2014), and yet we live shorter, less healthy lives than 30 of the world’s nations. Our problem is two-fold- how do we get more people to live healthy, happy lives, and how do we make it cost less to do so? From this vantage we are well poised to discuss how Clinton and Trump view healthcare. Even so, the American healthcare system has no clear solution. Truly, I envy the Lilliputians and their quarrels over which side of the egg is the proper one to crack.
But let’s dig a little further, talk specifics. Clinton believes affordable health care is a basic human right, and historically she has pushed for universal, comprehensive coverage; first by trying to expand Medicare/Medicaid in the ‘90s (the CHIP program being part of her lasting legacy), and later by championing the Affordable Care Act (ACA). Clinton has not shifted in this dogged pursuit, and shows no signs of doing so should she be elected.

Hillary Clinton’s healthcare goals are both admirable and ambitious. Chiefly, Clinton seeks to expand the ACA and Medicaid, reduce prescription drug costs, and increase funding to community health resources like Federally Qualified Health Centers (FQHC) and the health services corps (NHSC). I want to focus on this policy goal as it would have the greatest impact on the American healthcare landscape. While ACA covered 20 million more Americans and made a number of changes for the better-preexisting conditions no longer prevent coverage, kids can stay on parent’s insurance until age 26- it has fallen short of its goals. 1 in 10 Americans is still uninsured, while many more remain underinsured. Hillary’s plan introduces 4 major changes including cost-sharing tax credits (the biggest program by cost), reduced premium contributions for new enrollees in ACA, a fix in the ACA “family glitch”, and the introduction of a public option (i.e. “true government healthcare”). Finally, Secretary Clinton would insure that immigration status cannot deny individuals from purchasing insurance on the public exchanges.

Overall, the impact of Clinton’s proposed plans could radically reduce healthcare spending and increase coverage, painting a very optimistic view of life for American healthcare. In particular, the poorest individuals in our nation would benefit the most, and would see an average reduction in out-of-pocket costs of 33%. If you’ll allow me to speculate for just a moment, a reduction in cost of healthcare for the impoverished likely means fewer visits to the emergency room for routine problems, fewer angry patients, and very likely better health for many. Even private hospitals would see a benefit as their resources could be focused where they are needed. However, despite the most optimistic projections, the expansion of ACA is expensive- more expensive than can be covered by the increase in tax revenue as a result of expanding ACA. Getting down and dirty, Hillary’s tax plan would ease some of this economic burden by increasing taxes- the majority of that increase falling upon the wealthy (about a 4% increase to individual income and other more major changes to corporate-related taxes). 10-year projections give a net tax revenue increase of $191 billion. Compared to the $90 billion Secretary Clinton’s tax-credit program would cost, that’s pretty impressive. However, the story is more complicated as not all $191 is earmarked for healthcare spending, and much of it would go to pay for Clinton’s other proposed entitlement expansions. So while the cost of healthcare for most Americans would likely decrease, what this means for the nation as a whole is somewhat nebulous.

Whereas Clinton views healthcare as a right, Trump believes that the onus of healthcare decision making is on the individual- that is, healthcare decision making should be treated like any other economic decision a commodity to be purchased or not based on individual needs. By embracing that French phrase you learned in 9th grade history and promptly forgot- Laissez-faire economics- Trump seeks to enable the free market run its course, and lower prices through open and fair competition. Trump’s dedication to free market ideals is impressive. In line with this economic philosophy he plans to require price transparency from healthcare providers, enable the use of Health Savings Accounts, return Medicaid control to the state level, and open up the drug market to foreign competition. Trump’s biggest healthcare goal, and indeed one of the key factors that got him nominated as the RNC candidate, is his promise to repeal the ACA.

“Repeal ACA” is a very scary phrase for a lot of Americans, as scary for some as the thought of expanding it. But before we conjure up specters of Oliver Twist in line at the doctor begging “Please sir, may I ‘ave some more healthcare?”, let’s pause and ask what it actually means for Trump to repeal the ACA. To be clear, Trump’s health policies are not as well described publicly as those of Secretary Clinton, and a lot of this is guesswork from policy specialists. Thus four different scenarios have been considered- a repeal with no other changes, a repeal with Trump’s tax changes, a repeal with Medicaid block grants, and a repeal with sales across state lines. For our purposes we will be considering a repeal of ACA in conjunction with Trump’s proposed tax plan just as I did for Secretary Clinton.

Getting down to brass tax (yes I just made a tax pun), repealing the ACA (with the Trump tax plan) would reduce total healthcare coverage by 15.6 million people. Likewise, these changes disproportionately affect those who are impoverished and those already in poor health. This is because ACA protects individuals with preexisting conditions. In contrast, a repeal of ACA in conjunction with Trump’s tax plan would improve healthcare costs for the middle and upper classes, while increasing out of pocket costs for the impoverished. On average this totals to an out of pocket increase of $300. Finally, the price tag to the national debt- $41 billion. You might be asking right now how cutting programs costs money. It’s a little more complicated than this, but by cutting the ACA, the government would reduce tax revenue streams it has come to rely on in part. Even so, the Trump plan costs a little less than ½ of what it would cost to expand the ACA via Clinton’s proposed tax-credits.

This, however, is where we can speculate a bit, and again I’m going to try to be optimistic. When we account for macroeconomic effects, Trump’s tax plan reduces total federal revenues (the $41 billion being a small part of that cost) by $2.6-3.9 trillion over 10 years. That’s a big donut for the US government to fill. and would likely be paid for by borrowing additional money. With that said, economic growth that would likely be seen under Trump’s campaign could be used to fuel pay increases and improvements in private sector healthcare cost and coverage, or even create new, well-compensated jobs for the unemployed and/or uninsured. In theory, Trump’s economic and health policies could reduce health costs to a major, unpredictable degree. However, as has already been shown there is also great risk in his program-namely the loss of insurance for the impoverished, increases to out of pocket cost for many, and a big fat gap in federal revenue that might not get filled. If we get right down to it, Hillary’s policies are more solid, but with clear tradeoffs, whereas Trump’s plan is a gamble, riding on great risk but also with the possibility of much greater reward. Think of it like a game of roulette (no, not Russian Roulette), where Hillary bet on black, and Donald bet on double zero.

Neither candidate’s platform truly addresses the complex behemoth that is the US healthcare system. To be honest, I’ve really only scratched the surface- I haven’t discussed any of the smaller changes to healthcare or the candidate’s other policies, other than a brief mention of tax policy. Often, the whole thing really is as non-sensical as Swift’s island and its diminutive inhabitants. That said, it is juvenile and foolish to think that one side has all the answers, that a one-size fits all method can truly solve all of our problems, especially given the diversity of people, challenges, and opportunities found across our incredible nation. Perhaps the answer lies somewhere in the middle, perhaps somewhere else entirely. What I do know is that if we want ALL Americans to live healthier, happier lives, we cannot afford to be apathetic. We as physicians, students, healthcare providers, community organizers, and human beings must take a vested interested in the people around us. We must begin again to care about individual people, not groups or numbers or abstractions. We must encourage our friends and neighbors to invest in their health, and not just with their dollars, but with their time, their minds, their hearts, and their votes. It is easy to demonize the other side, to view them as some kind of monster. But when we do, we miss the bigger picture-that these two leaders believe that they can make a healthier, stronger America by enacting their policies. It’s high time we stop voicing our discontent in the echochamber that is our social media sphere, and have real open air conversations, where we do more listening than talking. Only then can we move forward together.

Vote your conscience. Fight the apathy. Do good in your community. And I’ll see you at the ballot box November 8th.

“This information is freely available on each of the respective candidate’s website, TaxFoundation.org, and commonwealthfund.org. All credit to the original researchers (though I did not cite these sources in text, as this is an informal blog post). I encourage you to examine these sites more fully on your own time and make your own decisions.”

Matthew Wright
Medical College of Wisconsin- Class of 2019

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