In the next few weeks, the Supreme Court will hand down its decision on the constitutionality of Obamacare and its individual mandate. Via Meadia and the public have both expressed our dissatisfaction with this boondoggle of a reform and its operating mechanisms, but if the law is struck down, what will replace it?The Economist offers one possibility: the “Utah Health Exchange”, which is experiencing early success and being rolled out to the entire state. So how does it work?
The Utah Health Exchange is decidedly not Romneycare or Obamacare. But what is it? At first glimpse, it is a snazzy web portal where four of Utah’s five largest health insurance companies offer about 140 plans to about 6,600 employees of 285 small businesses. Each employer determines in advance how much he will contribute to an employee’s insurance, as in a defined-contribution pension plan. The employee then filters the plans and selects his favourite—again, as he might choose mutual funds in his defined-contribution pension plan.As Patty Conner, the exchange’s director, explains, this has advantages over traditional corporate health insurance. In the old system employers had no certainty about premiums, which often rise abruptly. And employees, offered little if any choice, often got stuck with inappropriate plans. Small businesses, specifically, offered no insurance in Utah. Their employees and families account for many of the state’s 300,000 uninsured, more than 10% of the population.
Look for more such ruminations in the press as the decision date for Obamacare approaches. For while that law is not the solution to our nation’s significant healthcare problems, a solution must be found.