Whatever happens in the November elections, the cost of health care will soon rise to the top of challenges facing the new president and Congress.
On the Affordable Care Act's (ACA) exchanges, the requested premium increases for average silver-tier plans for 2017 averaged 11 percent, a recent analysis of 14 states found. Looming price hikes do not appear to be limited to the states in the report. Illinois, for example, made headlines just last week over proposed jumps of up to 45 percent. Cheaper plans are being offered but come with sky-high deductibles.
A bipartisan approach to fixing the health care law's problems could start by offering refundable tax credits to all, instead of restricting subsidies to primarily low-income enrollees. Doing so would appease those calling for greater access and those seeking more competition. If the tax credits covered the cost of basic, low-priced plans, every consumer would have access to a proliferation of choices.
Moreover, consumers who preferred more coverage would have to pay the additional costs directly out of pocket, giving providers strong incentives to make prices more affordable for even the most expensive plans. Cost-saving innovations that providers may enact include back-office management improvements and shifting reimbursement models away from inflation-prone, fee-for-service medicine to a pay-for-performance model.