This is so convoluted it’s going to be hard to work through. And the money involved, a mere $1.6 billion a year, is really pathetic and nearly 90 percent less of what experts say would be necessary to properly fund such a mechanism. But let’s break down what Republicans are doing. By allowing health-insurance companies to discriminate based on a pre-existing condition, the GOP would break the market for this subset of people. And then they would use government funds to fix this market failure. But they would funnel it directly to health-insurance companies, rather than eliminating the middleman.
This is single-payer for dummies. In a single-payer system, the government picks up the health-care costs for the population, paid for through progressive taxation. The market power of having one insurance payer can work to lower overall health care costs, making the system sustainable. In Trumpcare’s single-payer for dummies, the fragmented private-insurance middleman remains intact. But taxpayer dollars still pick up the health-care costs for those who cannot afford it. Instead of acquiring market power, they just give those taxpayer dollars to the private middlemen, which tells the private middlemen they can charge whatever they want and always get paid.