The World of Tomorrow

by Yuval Levin
Monday’s New York Times had another classic entry in the annals of Obamacare. It seems that nursing homes are asking HHS for waivers from Obamacare’s requirement that employers provide health coverage to their workers. Nursing homes, even though they are in the health-care business, often don’t provide insurance to their employees. They can’t afford to. And why is that?
Mark Parkinson, president of the American Health Care Association, the largest trade group for nursing homes, says the problem is that reimbursement rates for Medicaid and Medicare, set by government agencies, do not pay them enough to offer their employees medical coverage. “We do not have much ability to increase prices because we are so dependent on Medicaid and Medicare” for revenue, he said.
Yes, that’s right. They can’t afford to give their own workers health insurance because they are dependent on government-provided health insurance programs for their own revenue, and the arbitrary price controls in those programs don’t allow them to make much of a profit. So what’s the solution? The Times doesn’t miss a beat:
Supporters of the law say several provisions will help low-wage workers who are uninsured or have bare-bones coverage. The law will expand Medicaid to cover people under 65 with income less than 133 percent of the federal poverty level, and it will offer subsidies to make insurance more affordable to those with incomes from 133 percent to 400 percent of the poverty level ($24,645 to $74,120 a year for a family of three). “This assistance could significantly increase coverage among direct-care workers because 80 percent of them have income less than 400 percent of the poverty level,” said Dorie K. Seavey, director of policy research at the Paraprofessional Healthcare Institute.
Of course! The solution is to put even more people on Medicaid and create another new entitlement. Maybe we can also tighten Medicare’s price controls even more, but without reforming either program to make it more efficient by making it more answerable to actual price signals and consumer preferences in the market. Of course.  The solution to the failures of central planning is more central planning. Maybe when all of our employers are put out of business, we can all go on Medicaid, and then the health-care problem will finally be solved.

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