OPINION: On health care, Trump has serious boundary issues

Oct. 14--To hear Republican presidential nominee Donald Trump tell it, it's those dreaded, pesky state lines that make health insurance so darn expensive. Erase them and ... well, let's listen to him discuss the issue during the second presidential debate Oct. 9:

"We have to get rid of the lines around the state, artificial lines, where we stop insurance companies from coming in and competing," he said. "We want competition."

A moment later, debate moderator Anderson Cooper pressed the point with him. "You've said you want to end Obamacare," he said. "You've also said you want to make coverage accessible for people with pre-existing conditions. How do you force insurance companies to do that if you're no longer mandating that every American get insurance?"

"We're going to be able to," Trump said. "You're going to have plans that are so good, because we're going to have so much competition in the insurance industry. Once we break out -- once we break out the lines and allow the competition to come."

Cooper asked, "Are you going to have a mandate that Americans have to have health insurance?"

Trump blew past the question and eventually circled back to his main talking point. "When we get rid of those lines, you will have competition," he said. "And we will be able to keep pre-existing, we'll also be able to help people that can't get -- don't have money because we are going to have people protected."

The idea that allowing health insurance companies to sell coverage "across state lines" will conjure the magic of the free market and thus significantly lower customer costs and expand coverage is an article of faith among many Republicans. And it sounds good to most people -- a Rasmussen Reports poll in June found 66 percent of the public in support.

So let's unpack it.

Contra Trump, current state laws do not "stop insurance companies from coming in and competing." Blue Cross and Blue Shield, Aetna, Humana and so on are all welcome to get licensed in any state they wish and set up shop to compete with other insurers to sell coverage at the best price.

When they enter a market, however, they must abide by the regulations in those states designed to protect the interests of patients and providers.

Advocates for allowing the sale of health insurance "across state lines" are really talking about allowing an insurer based in, say, Kansas, to sell plans to, say, Illinois residents that follow the regulatory guidelines in Kansas rather than the regulatory guidelines in Illinois.

The "competition in the insurance industry" Trump dreams of would actually be a competition among the states; competition to set the regulatory bar as low as possible in order to lure corporate headquarters and the jobs and taxes they generate.

The beloved market forces dictate that such competition would be a race to the bottom -- similar to the de-regulatory battle that saw nearly all major credit card companies end up located in Delaware, Nevada and South Dakota, where the credit-banking laws are the most lax.

Essentially, then, under this idea, states would cede their authority to license and regulate health insurance to whichever small, ideologically conservative state would give insurers the most latitude in which conditions and patient groups they have to cover, when they can withdraw coverage, how solvent they have to be, how they settle disputes and so on.

Would some customers get a better deal that way? Sure. Younger, healthier people would probably pay dramatically lower premiums for bare-bones policies adequate for their demographic group. Middle-aged and less healthy people would probably pay dramatically higher premiums if they could find coverage at all, thus making worse the coverage gaps and disparities that the 2010 Patient Protection and Affordable Care Act (Obamacare) attempted to address.

Strangely enough, the issue page about health care at Trump's campaign website seems to anticipate the potentially dystopian result of such an interstate regulatory competition and says, "As long as the plan purchased complies with state requirements, any vendor ought to be able to offer insurance in any state."

But that's exactly what we have now!

And the reason we don't see dozens of health insurance companies flooding into every state to compete on price alone -- and the reason we didn't see this before Obamacare -- is that setting up provider networks and signing up a critical mass of business and individual customers is hard.

Trump's idea -- "When we get rid of those lines, you will have competition, and we will be able to keep (providing affordable coverage to people with) pre-existing (medical conditions)" -- assumes, crazily, that it's merely burdensome regulations that now discourage carriers from offering low-cost health care policies to cancer patients, diabetics and others living with chronic, expensive conditions.

It also assumes, also crazily, that state legislatures will go along with any proposal that takes from them the power to enact and enforce regulations designed to protect their constituents and in effect gives that power to the legislature in the most lenient state in the union.

Given what a nonstarter that idea is, the other "across state lines" option is to have the federal government create a comprehensive set of national health insurance regulations to prevent a race to the bottom and allow insurance companies to engage in price competition on a level playing field from coast to coast.

Three things about that, however.

One, taking power from the states and giving it to the federal government goes against the Republican brand.

Two, nothing suggests it will save much money or allow more people to buy coverage.

And three, the creation of a set of national health insurance regulations is key to the Affordable Care Act that the Republican nominee deems a "disaster."

Once again Trump is incoherently spouting bad ideas.

Once again, no one who has been paying attention is surprised.

Re: Tweets

The winner of this week's reader poll for best tweet is @68Cly29: "Not to brag, but it is only October and I already have my winter body." To read the 19 runners-up and sign up to get an alert when the next poll is posted, go to www.chicagotribune.com/zorn.

Listening to this week's Mincing Rascals podcast at chicagotribune.com/mincingrascals.

___

(c)2016 the Chicago Tribune

Visit the Chicago Tribune at www.chicagotribune.com

Distributed by Tribune Content Agency, LLC.