Healthy Utah May Be Improved, But It’s Still a Bum Deal

Healthcare

The Utah Senate today passed SB64 S01, a modification of the Healthy Utah plan to more-or-less implement Medicaid expansion without calling it that. (Because: REASONS.) It makes a number of improvements to the original plan (including numerous automatic termination conditions), but it still maintains a fatal flaw: it doesn’t improve health care. In fact, it’s just a big expansion of subsidies to insurance companies and the medical industry with no expectation of improved quality of care or reduction in costs.

Most alarming is that even without the expansion of Healthy Utah, Utah’s Medicaid costs are expected to increase from 23 percent of the current general fund to 30 percent by 2020. When you consider how the state’s budget grows, you’re starting to look at nearly doubling the amount of money spent on Medicaid, not counting inflation, within a decade. This rate of growth is unsustainable, yet none of the conversation from proponents of expanding Medicaid wants to talk about it.

So why aren’t we having a costs conversation? Because there are a lot of people with financial interests in keeping us just sick enough to cash in. Done right, the medical system would lose about half of its jobs as medical outcomes drastically improve. That’s a strong disincentive to truly address why we’re paying so much money for the same or worse care.

We’re also seeing the exact same issues as have plagued housing crashes and the student loan crisis. In both cases government intervened to try to keep costs low, but the market responded by increasing prices as high as could be tolerated. Subsidies don’t reduce costs, but they do help industries with top-notch lobbyists convince you that paying them twice for the same product is to your benefit. Now we’re seeing the same thing in health insurance. The bill of goods being sold is that if we subsidize insurance for some, we’ll somehow end up with lower costs, but we’ve tried to kick that football before.

At the end of the day, any plan that doesn’t attempt to reduce medical costs is a loser. Period. Full stop. End of story. Any bandages proposed for that gunshot wound would only make the problem worse.

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