A novel legislative concept may be gaining some traction. Action Alert!
Here’s the gist of it. Rather than develop an alternative federal system, just turn health insurance over to the states. If California wants to create a single-payer system, allow it to do so. If another state likes Obamacare, let it keep it. If another wishes to create a consumer-driven system, then allow that.
In a recent interview with Breitbart News, former Pennsylvania Senator Rick Santorum outlined the plan, which seems to have originated with him. It involves diverting Obamacare block grants to the states based on the number of citizens who are low income but not covered by Medicaid. This would allow individual states to customize their health plans to the needs of their constituents. States that wish to do so could create the kind of consumer-driven system, free of Obamacare mandates, that ANH believes is the best way to increase individual choice while driving down overall health care costs. Or they could offer both this and the present system to consumers.
Santorum expects at least some Democratic governors and members of Congress to get on board. This may be optimistic. But they could have an incentive to do so inasmuch as Obamacare subsidies disproportionately go to states such as New York, California, Maryland, and Massachusetts. Lawmakers from other states could see this as a way to get more federal money. These four states will of course completely oppose it.
Senators Lindsay Graham (R-SC) and Bill Cassidy (R-LA) are crafting legislative language and working to gain support. Under this approach, Congress would give states guidelines to ensure adequate coverage; for instance, requirements covering preexisting conditions would stay in place. If this forces everyone into the same risk pool, it won’t work. But states would supposedly be free to craft their own system to best address the needs of their citizens.
ANH would much prefer just keeping Obamacare and at the same time offering a consumer led system that would be available to residents of all states. But this new approach would be better than the existing system, which is at risk of collapse. Allowing states to do their own thing would also provide many experiments that would be useful in establishing what works and what does not. States would have to take this seriously because they compete with each other. Those who make the wrong choices would see their economic prospects fade while other states add employers and jobs.
Action Alert! Write to Congress and tell them to support the new plan to repeal and replace Obamacare. Please send your message immediately.