Saturday, May 11, 2013

Market Rules 

Several of the provisions of the Affordable Care Act, a.k.a. Obamacare, are commonly referred to as benefits.  These include the higher age at which young people can be included in family health insurance policies, the prohibition against denying health insurance coverage on the basis of pre-existing conditions, and the abolition of ceilings on the dollar amount of health insurance benefits. 

Calling these provisions benefits is accurate, but they also serve another purpose.  They begin to provide a structure for a functioning market in the provision of health care.  

If and when such a market emerges, competition should be based on safety, outcomes, patient satisfaction and cost, with market success being determined by performance in these areas.  Insurance companies and providers should not be maneuvering for competitive advantage by lowering the age of children that can be covered under family policies, implementing a pre-existing condition exclusion, or setting dollar limits on benefits. 

Whether we will ever have real market competition among health care providers remains to be seen, but by establishing some rules Obamacare is a step in the direction or making it a practical possibility.



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