Why I'm In Favor of Obamacare -- Or Any Change From The Status Quo
Most of you are aware of what happened to my wife a few years ago. There was a giant autoimmune attack on her brain, which fortunately turned out not to be a brain tumor. But it left her, among other things, uninsurable. She had to have $130,000 worth of brain surgery and hospitalization on three or four days notice.
For which I paid $700, because I was a member of a German-style health care cooperative. Which was good. But if at any point in the future she's ever uninsured again -- and, remember, she's had health problems which make insuring her as economically rational as providing homeowner's insurance to a house which is already on fire -- she stands a substantial chance of just dying, if she gets sick.
I don't expect other people to take care of my family. I don't expect a handout. But the reason that health insurance exists at all is that there are very few people, and virtually no charities or nonprofits, that can absorb $130,000 in medical costs without going bankrupt. This despite the fact that, even on cold economic reasoning, saving the life of someone who makes $50k a year is perfectly economically rational decision: if they have 20 more years of life, they stand to make $1m.
Letting them die because they can't meet the threshold cost isn't just heartless, it's brainless. And this was sometimes the case before Obamacare, less often because of a lack of critical care, and more often because the funds for monitoring dangerous conditions were not available at the time they would have been of use.
The obvious objection is "well, fine; maybe it's stupid to do something else, but is Obamacare sustainable or a good idea?" I think the answer is "well, maybe, but you need to look at where we came from."
The assumption underlying all of the furor over Obamacare is that American medical costs were sustainable before
the ACA. But they weren't: in 2011, before any of Obamacare's provisions had gone into effect, we were paying 50% more per capita for medical care as the next-most expensive country, Norway . And health care costs were increasing by 5-9% every year . This extra 50% didn't produce substantially better outcomes -- just shorter waiting lists for non-essential but quality-of-life enhancing procedures like hip replacements.
In other words, the status quo before Obamacare was pretty terrible. The status quo is less terrible now.
Since Obamacare passed, the increase in medical costs have flattened out. Healthcare inflation is down from a high of 9% to a recent low of 2.34% . You might note, correctly, that Obamacare has nothing at all to do with this: few of its provisions, and none of its cost-control provisions, have gone into effect. I don't think that you can attribute that decline in costs to Obamacare -- but you can't blame a sharp rise in costs on Obamacare, either, because that's not what the data shows.
As for the rise in insurance costs, the young, healthy, and male will probably pay significantly more for health insurance. The old, the unhealthy, and women will pay less. Obamacare's community rating provisions mean that (in essence) that everyone
pays for the increased risks associated with people with (for instance) my wife, rather than their own personal risks. Is that ... socialism? Well, it's socializing risk, I guess, but only to a somewhat higher degree that health insurance already does.
So, okay. That brings me to the last thing: is Obamacare sustainable? And the answer is, "on balance, probably more so than the status quo, but less so than if we had never gotten in this mess to begin with."
The short reason why is that socialized health care, both in America and elsewhere, tends to be cheaper than market-delivered healthcare . The reasons for that are outside the scope of my answer, but it holds true from country to country: there's only one market-delivered healthcare system that provides a high level of service and contains costs, and that's Singapore's [5, 6]. And even the Singapore system has a lot of caveats, from the interlocking public-private bureaucracy, to the seldom-used but oft-threatened price controls, to the fact that it's a city-state under a single system of law.
I'd be willing to live under any of these systems, market-delivered or socialized. As I mentioned, I was extraordinarily
happy with the German-style cooperative that saved me from medical bankruptcy. I would be fine with the Singapore system, if it could be scaled up to US scale (though I doubt that it can.) I think that the Swiss and Dutch systems, which are very much like Obamacare, are perfectly adequate. And I think Obamacare is adequate.
If a replacement system with good economic fundamentals, based on an internationally proven model, were being proposed along with this continuing resolution, I'd be fine with it. But the status quo that the Republicans want to return to was not sustainable, and shows no sign of being sustainable in the future.
Which is why I find the American conservative preference for past disasters, rather than future ones, so infuriating.
 I wouldn't normally cite to myself, but if you're interested, this is why I think that is: https://plus.google.com/112482032780181267192/posts/eM4EckVMJY6