Commentary

High-Risk Pools Ease Transition

High-risk pools can help transition to a system that makes high-quality medical care affordable and secure for patients with high-cost conditions. Obamacare is utterly failing in this regard. And while congressional Republicans are eyeing state-run high-risk pools, their approach is also woefully inadequate.

Government is not the solution to the problem of pre-existing conditions. Government is the problem.

The result would be fewer patients falling through the cracks.

Congress bestows favorable tax treatment on employer-sponsored health insurance, a type of coverage that disappears for no good reason when workers change jobs, lose jobs or retire; for kids when they turn 18 or 26; and for spouses following a divorce or the worker’s death. Only government could push 160 million Americans into health insurance that’s as reliable as a faulty parachute.

Too often, employer coverage disappears after workers or their loved ones develop expensive medical conditions. Government thus turns what would be insured conditions into pre-existing conditions.

Fixing this problem requires repealing Obamacare and replacing it with expanded health savings accounts. Workers could control the $700 billion employers spend on health benefits each year, using it to buy secure, portable coverage.

During the transition, high-risk pools could subsidize those with uninsurable pre-existing conditions. The result would be fewer patients falling through the cracks.

Obamacare’s “solution” is to force insurers to cover pre-existing conditions, which will leave many sick and healthy patients alike uninsured. Obamacare is in a “death spiral,” according to Princeton economist Uwe Reinhardt. Some 43,000 Tennesseans may have no way to buy coverage in 2018.

Republicans are planning to subsidize pre-existing conditions in separate high-risk pools. But since their evolving plan would neither fully repeal Obamacare nor let workers control that $700 billion, it won’t make coverage more secure for the sick. No amount of government Band-Aids will stop the bleeding from this government-inflicted wound.

Michael F. Cannon is director of health policy studies at the libertarian Cato Institute.