Will Obamacare be Trumped?

Donald Trump’s success is the product of exposing an undercurrent of economic and social frustration permeating America’s lower middle class. He is the oxygen fuelling a venomous fire against establishment politics. His victory represents the widening chasm between red and blue America.

For many, he appeals to taboo truths, which for too long have been drowned by the raucous voices of the self-righteous left. Stubborn outrage persists across social media’s echo chambers and continues to gnaw at the festering wound of American discontent.

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Central to Trump’s campaign has been the promise of healthcare reform. He has repeatedly called for the complete repeal of the Affordable Care Act – Obamacare, as it is commonly referred to.

In many ways, an attack on Obamacare is a symbolic one. It has been a vehicle to undermine the competency of a democratic administration. However, so soon after his victory, Trump appears to be washing his hands of key campaign promises. In his quest to ‘make America great again,’ the healthcare of ordinary American citizens lies in the balance.

 

The US healthcare system, as it stands

The American healthcare system is unique. Coverage for healthcare is mediated through a private health insurance market. For most, insurance policies are provided by their workplace. Those who are unemployed or working for small business must seek health insurance on their own accord. Medicaid, a government run program, offers free or low-cost healthcare for those who command little financial and social resources.

Healthcare is big business in the United States. Each year the government spends $3 trillion on medical care, or just under $10,000 per capita – a figure that is well above its peers in the developed world. Year to year, the rate of increase in healthcare spending outpaces inflation and wage growth.

Rising inefficiencies in the United States’ healthcare system have seen the financial burden being increasingly placed upon households. State and federal budgets have become overwhelmed by Medicaid expenditures. Furthermore, perverse incentives for healthcare payments can mean providers are paid for the services they deliver regardless of whether they truly benefit patients.

 

What is Obamacare?

Obamacare is the most significant example of United States healthcare reform since Medicaid was introduced in 1963. The goal of Obamacare is to provide health coverage to millions of uninsured or under-insured Americans through online state and federally regulated insurance marketplaces. Online marketplaces act as an Expedia for insurance policies, allowing uninsured individuals to choose from a range of policies.

In order to increase health insurance coverage, the law places certain requirements on private health insurance agencies as well as the individual. These mainly focus on subsidies, mandates, and price controls. Obamacare also has provisions  to expand eligibility for Medicaid, however this has been rejected by 24 republican led states; it is a political decision that has left approximately 5.7 million of the most vulnerable citizens without coverage.

On a number of measures the law has been a success. 20 million previously uninsured Americans now have coverage. Of these individuals, two-thirds are part of ethnic or population minority groups and many are low-income immigrants. Increasing health coverage encourages more individuals to address their primary healthcare needs and contributes to economic security.

For many Americans, Obamacare has meant they are no longer a medical emergency away from financial ruin.

Why is it controversial?

At every stage Obamacare has experienced strong resistance. It has overcome challenges in Congress and the Supreme Court and been vehemently opposed by labour unions, small business advocates and conservatives.

A key argument against Obamacare centres on the imposition of excessive regulation on private corporations and individuals. Citizens are compelled to use their own money to purchase a private product or face sanction. Private insurance agencies are required to provide coverage to individuals regardless of pre-existing medical conditions.

However, for this to be financially sustainable, younger healthier individuals are required to purchase coverage in order to offset greater costs imposed by their older and more medically vulnerable counterparts. Without such participation, either insurance premiums will become increasingly unaffordable, the quality of coverage provided will reduce, or private insurance companies will simply withdraw from Obamacare.

To some extent, all three are happening at present.

 

What will Trump do?

Trump’s campaign promoted a black and white message about its stance on Obamacare, but since his victory in last week’s election his position has become significantly more opaque. He has expressed his intentions to maintain two of the more popular provisions of Obacamare – children up to the age of 26 being allowed to remain on a family plan, and insurance companies being unable to deny coverage to individuals due to pre-existing conditions.

However, there are no easy solutions. It is impossible to salvage only the positive vestiges of a socialised system without imposing some regulation and freedom-reducing policy. Likewise, an unregulated insurance market cannot be expected to provide universal health coverage – the old, the poor, the unhealthy ‘undesirables’ will inevitably be further marginalised.

Trump’s words are naively utopian in their search for a Goldilocks healthcare system.  Whilst many have welcomed his recent concessions, many more remain cautious. Perhaps they are simply a political varnish to temper immediate outrage. Or maybe they reflect Trump’s willingness to redress the hardline stance he espoused to reach the White House.

The narrative of the American dream is decaying. Donald Trump has the mandate of the American people to drive economic and social prosperity to restore its allure and attainment. Reforming the American healthcare system will test just how successful a Trump administration might be.

His words have been heavy with vitriol, and many await whether his actions as president will mirror his claims in opposition. Only time will tell what kind of presidency Trump will lead, and in the meantime the health of millions of Americans remains in the balance.

The views and opinions expressed in this article are those of the author and do not necessarily represent those of the Doctus Project.