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The Leaflet: Choice and Competition will Cure America’s Health Care Crisis

December 7, 2018

This week, the Trump administration released a new report about the role rules and regulations have played in rising health care costs and limiting health care choices.

On December 3, the U.S. Department of Health and Human Services (HHS) released a 119-page report titled, “Reforming America’s Healthcare System Through Choice and Competition.” The report cites excessive mandates, licensing restrictions, and a general lack of competition as driving forces for sky-high premiums, limited coverage options, and out-of-control costs.

For years, numerous federal and state mandates have forced health insurance companies to only offer plans that cover a wide range of medical conditions and services while banning the sale of so-called “skinny” plans. As a result, these mandates have skewed the health care market, dramatically increased costs, and driven many young and healthy Americans to forgo health insurance.

In the report, HHS recommends that legislators repeal unnecessary mandates and allow for the sale of affordable, less-comprehensive insurance plans such as association health plans, short-term, limited-duration plans, or catastrophic plans.

Onerous regulations and runaway health care costs are also producing an ever-worsening provider shortage. Nearly 84 million Americans, a majority of whom reside in rural areas, have inadequate access to physicians. A lack of medical professionals and facilities only exacerbates the prohibitively high costs of health care, further reducing low- and middle-income Americans’ ability to receive health care services.

To counter the growing threat of doctor shortages, the report suggests states allow non-physicians (nurse practitioners and physician assistants) and non-dentist providers (hygienists and dental therapists) to independently treat patients. Furthermore, HHS promotes reforming scope-of-practice statutes and recommends increasing the use of telemedicine, which allows doctors to deliver health care via telecommunications. Telemedicine can revolutionize health care by replicating in-person care at a significantly lower cost than traditional in-person care.

HHS also identifies Certificate of Need (CON) laws as an obstacle to a robust free-market health care system. CON laws, which require new medical providers to prove to local government that additional medical facilities or services are needed, favor existing medical providers. CON laws significantly reduce competition, leaving consumers with fewer high-quality health care choices. HHS urges state legislators to either repeal or scale back CON laws.

The report comes a year after President Donald Trump issued an executive order to promote health care choice and competition. The Trump administration has already made significant progress at the federal level, including the elimination of the individual mandate, the extension of short-term, limited-duration health plans, and the expansion of association health plans. Additionally, the Trump administration has allowed HHS to grant Section 1115 and 1332 waivers that give states more flexibility to implement health care reforms.

State legislators should take full advantage of the administration’s willingness to allow more choice and competition in the health care system. For decades, The Heartland Institute has urged legislators to implement many of the same recommendations presented by HHS. When the new legislative session begins, legislators should consider reforms outlined in Heartland’s “Don’t Wait for Congress to ‘Fix’ Health CarePolicy Brief. Reforms include applying for Section 1115 and Section 1332 waivers, expanding scope of practice rules, repealing costly mandated benefits, and eliminating CON laws, among other free-market health care solutions.

Heartland has an array of publications and podcasts discussing the problems and solutions of the current health care crisis. Legislators needing additional research materials, policy expertise, and in-person testimony can always reach out to Heartland government relations at 312-377-4000 or governmentrelations@heartland.org.

 

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