Health Care and Market Based “Solutions”

The opening of a critique of TrumpDoesn’tCare by John Osborne has this canard:

The excerpts are interesting, not because there were stunning disclosures or revolutionary ideas, but to the contrary they reveal what many have been saying for some time: there is no plan that will enable the Republican Congress to effectively replace Obamacare by relying solely on conservative, market-based solutions...at least not without risking great disruption to an already skittish insurance market.

The canard is that conservatives have some “market based solution”. This begs solution to what? I wonder if these conservatives have read the 1983 paper by John Moskop ?:

This paper considers whether Rawls' theory of justice as fairness may be used to justify a human right to health care. Though Rawls himself does not discuss health care, other writers have applied Rawls' theory to the provision of health care. Ronald Green argues that contractors in the original position would establish a basic right to health care.

While Moskop does not entirely agree with Ronald Green, many of us see the health care debate as one of basic fairness – not just efficiency. But let’s get real – the reasons that we pay twice per capita for health care than many other nations do include several forms of market power that Republicans heart. For example, we could end the Big Pharma monopolies if we found some other means to encourage R&D other than patent protection. We could end the doctor’s cartel as Milton Friedman advocated back in 1992. And of course Brad and Michael DeLong noted:

The United States’ Affordable Care Act (ACA), President Barack Obama’s signature 2010 health-care reform, has significantly increased the need for effective antitrust enforcement in health-insurance markets. Despite recent good news on this front, the odds remain stacked against consumers…It is not surprising, then, that in 2015 some of the largest private American health-insurance companies – Anthem, Cigna, Aetna, and Humana – began exploring the possibility of merging. If they could reduce the number of national insurers from five to three, they could then increase their market power and squeeze more profits from consumers.

We should remember, however, that Speaker Ryan is bought and paid for by the health insurance oligopolists. I earlier highlighted the Safeway Amendment. It turns out that Safeway is part of a Southern California oligopsony market:

Grocery workers across Southern California voted to authorize a strike against Ralphs and Albertsons, which includes Vons, Pavilions and Safeway stores, union officials reported. The vote by 47,000 United Food and Commercial Workers members gives union officials the power to call for a strike if the supermarkets don’t back down on their demands. The grocery companies and union have 10 meetings scheduled through the end of July. The supermarkets have offered one 10-cent per hour wage increase through 2018, as well as two bonuses of 10 cents an hour and 15 cents an hour during that time, according to Rick Icaza, the president of United Food and Commercial Workers Local 770. He said the stores also would not fund healthcare beyond current levels, forcing employees to contribute more or sacrifice coverage; reducing their future contributions to pensions; and forcing employees to retire at 65 rather than 60.

Safeway and the other stores have been cutting fringe benefits by more than nominal wages have been increasing. Back in 2004 the United Food and Commercial Workers were particularly concerned about how Safeway was cutting health care benefits:

From Southern California to Canada and across the United States, United Food and Commercial Workers (UFCW) activists and their allies are planning actions and asking shoppers to stay away from Safeway grocery stores. Safeway’s chief executive officer Steve Burd is leading a coalition of grocers demanding deep cuts in workers’ health coverage as well as lower wages for new hires. The success of the union movement-wide “Hold the Line for Health Care” campaign is important to all workers, whether or not they are represented by a union, said Jenifer Riddagh, a UFCW Local 1036 member and 29-year veteran of Safeway-owned Vons stores in Southern California. “What happens to us will affect everyone’s ability to purchase not just affordable but adequate health care,” she said.

But Safeway is the role model for the Ryan Republicans. I guess Paul Ryan sees this as the market based solution to making sure companies get higher profit margins. Republicans neither care about basic fairness nor efficiency as the only goal is more income for rich people.