Rogue State Lawmakers Should Write Health Care "Star Wars" Episode in 2017
Any lawmaker, health care policy geek, or ordinary citizen suffering under the Affordable Care Act (ACA) who sees "Rogue One: A Star Wars Story"—which grossed more than $439 million in the United States in its first three weeks and led the top 10 movies over New Year’s weekend—may glimpse a parallel or two between the intergalactic power struggle on screen and the real-life struggle to liberate health care markets from imperialist elected and appointed officials. (Minor spoilers follow.)
"Rogue One" reveals how the overwrought Vader/Luke/Leia saga portrayed in other films shapes the battlefield for countless freedom fighters dealing with the unintended consequences of choices made by leaders far, far away. Similarly, state lawmakers in 2017 will have the chance to write their own "Rogue One" health care laws in answer to the federal government’s Star Wars.
As Ben Domenech, publisher of The Federalist and The Transom, has noted, "Rogue One" steers the camera away from the soap opera drama of the Skywalker family central to other Star Wars films—a thin sliver of the generations-long war raging across the galaxies—and instead narrates the heroism of ordinary soldiers tasked with extraordinary challenges.
Health care policy debates in the United States frequently resemble the seven “main line” Star Wars films by focusing on a few personalities whose decisions reverberate at every level of American society: President Barack Obama, Supreme Court Chief Justice John Roberts, Department of Health and Human Services (HHS) Secretary Sylvia Burwell, former HHS Secretary Kathleen Sebelius, Centers for Medicare and Medicaid Services Acting Administrator Andy Slavitt, Senate Minority Leader Harry Reid (D-NV), House Minority Leader Nancy Pelosi (D-CA), Jonathan Gruber, and Ezekiel “Zeke” Emanuel, among others.
The reality, however, is that the struggle to liberate patients and markets from overregulation will outlive the reign of these famous officials and policy architects, just as it predated them, and that for every showdown over health care policy in Washington, DC, there are hundreds of skirmishes unfurling closer to the people. Scattered across these United States are 50 state legislatures waging their own unique battles for (and against) health care freedom.
The decisions federal lawmakers and bureaucrats have already started making in 2017 regarding ACA—whether to repeal it wholly or partially, and whether to replace it immediately or in three years or at all—will cause repercussions in each state. But state lawmakers should not wait for Washington, DC, to dictate their next moves.
Overreliance on federal officials to boost the country into health care hyperspace landed the country in the Obamacare asteroid field. State lawmakers should consult the other end of the spectrum for answers: patients and health care providers acting in their own self-interest.
For example, while Congress and President-elect Donald Trump devise ways to expand access to affordable health care, state lawmakers can beat them to it by repealing certificate-of-need (CON) laws, which obstruct innovation, competition, and patient access. Thirty-five states entered 2017 with CON laws on the books. Some of these laws require developers of medical facilities to obtain special permission from a state board before opening up a new treatment center, renovating an existing facility, and buying expensive equipment, such as imaging machinery.
CON review boards frequently consult special-interest groups hell-bent on blocking innovators from entering the region’s health care market. This would be like the Jedi Council asking Darth Vader which of the little Jedi Younglings should be trained to defeat him. (This would be a terrible idea, considering Vader massacres all the Younglings, along with most of the Jedi Council, in his attempt to eliminate challengers, in "Star Wars: Episode III – Revenge of the Sith").
Consequently, CON laws keep health care prices high and quality low by restricting the supply of providers, competition, and ease of entry for disruptive innovators. State lawmakers should repeal these anti-competitive laws, trusting patients to reward providers offering the best value.
State lawmakers can further expand access to affordable, high-quality care faster than officials in Washington, DC, by protecting an up-and-coming direct-pay health care business model from overregulation. In many states, patients have started paying doctors monthly membership fees of $25 to $150 per person in exchange for a suite of preventive care services and tests. These direct primary care (DPC) agreements are cost-effective for patients and providers because they bypass middleman insurers.
Nevertheless, inaction by state lawmakers deters prospective DPC providers from treating patients under this proven business model. Only 13 states have passed laws specifying that DPC agreements are not a form of insurance and shall not be regulated as such. Consequently, the possibility of investing in a DPC clinic only to be robbed and destroyed by a Jabba-the-Hut-like mafia of insurers and bureaucrats deters entrepreneurs and market-driven cost reductions in 37 states.
State lawmakers should not wait for Trump and Congress to figure out how to destroy the Death Star of overregulation in the country’s health care and insurance markets. Instead, state lawmakers should eliminate the threat of government interference in their own backyards. The force of the free market will be with them.