Joe Biden and Donald Trump are clashing over Obamacare—legislation that recently marked its 14-year anniversary of cementing wide scale government subsidies into the U.S. healthcare structure.
Since its passage, Democrats have only doubled down on the approach by injecting even more taxpayer dollars into the system. The U.S. needs to head for the exit of this high-stakes merry-go-round. Otherwise, inflationary pressures within healthcare will only continue to build—harming patients who are already struggling to afford care.
The Biden administration thus far has been an enthusiastic participant in the game of financial smoke and mirrors. Notably, the White House continues to advocate for bigger and bigger Obamacare subsidies to counterbalance rising healthcare costs. While it may score Biden political points in the short run, the approach creates a feedback loop that’s difficult to stop.
The more federal dollars that pour into the system, the higher the prices will go. While the ballooning costs are obscured to some Americans by Obamacare subsidies, taxpayers as a whole and families living on the margin that don’t qualify for the benefits feel the pain. Since 2012, spending on healthcare in the U.S. has increased by 60 percent.
It’s a situation akin to the spiraling college tuition crisis that is plaguing American students. For years, the federal government has been propping up higher education through generous student loan programs—a proverbial gravy train that has incentivized university leaders to raise prices. According to The Wall Street Journal, tuition costs at the median flagship state school have increased by 64 percent over the past two-decades.
Now, moves by the Biden administration to incrementally forgive student loan debts are exacerbating the situation. It’s a signal to colleges that no matter how high tuition levels rise, Uncle Sam will always be there as a backstop to foot the bill. The Democrats’ healthcare agenda is similarly writing the country’s medical leviathan a blank check.
Rather than simply throwing more taxpayer dollars at the problem, policymakers should pursue a policy agenda anchored in choice, transparency, and competition. While restoring a generally free market healthcare system may be overly optimistic, incremental actions can blunt the consequences of Obamacare and subsequent government encroachment.
Legislation has already been introduced in Congress that can get the ball rolling in the right direction.
The Lower Costs, More Transparency Act already passed the House and is awaiting Senate approval. The bill would make hospital prices more transparent while also reining in the middlemen of the drug supply chain. Just three of these entities, called Pharmacy Benefit Managers, control roughly 80 percent of the prescription drug market—power that gives them license to game the system and inflate the prices patients pay at the pharmacy counter.
The Senate should make passage of this legislation a priority; it’s a win-win. The extra transparency and accountability will help lower prices without costing taxpayers a dime.
Other helpful policy agenda items include thinning government regulations associated with Obamacare that restrict patient choice. Americans should be free to access medical plans that best fit their unique circumstances—ranging from Cadillac insurance to catastrophic coverage. The healthcare needs of a healthy twenty-something are much different than someone approaching retirement.
Since the passage of Obamacare, the government has continued to attach more puppet strings to healthcare—layering government red tape and financial subsidies onto the system. Although done with good intentions, the policies are contributing to snowballing prices. Taxpayers and American families will continue to bear the consequences if it doesn’t stop.
Tom Price served as the 23rd U.S. Secretary of Health and Human Services and is a senior health care policy fellow at the Job Creators Network. Elaine Parker is the president of the Job Creators Network Foundation, which manages the HealthcareForYou.com policy reform framework.