President Trump made some experts snicker when he explained the delay in unrolling the Republican replacement for Obamacare: “Who knew health care was so complicated?” Pundits who had spent years sweating the details of the many facets of health insurance policy came back at Trump with versions of “Er, hello? We’ve been saying that for years. Now if you’ll turn to page 723 of my proposal….” Indeed the policy details are enormously complex, and I won’t presume to wade in as an amateur to the debate over whether the current Republican proposal is the smartest or most politically viable plan for setting free one-sixth of the U.S. economy.

One thing conservatives have been right about all along: Obama’s plan was so complicated and unsustainable, it was tempting to believe that it was constructed that way on purpose. By building a Rube Goldberg machine that first entangled millions of Americans, before collapsing under its own weight (well after he’d left office), Obama would create the conditions where Americans would demand that the federal government “solve” the new healthcare crisis by creating a single-payer, British-style system of socialized medicine. In effect, the whole country would just slide onto Medicare.

Hard-working conservative policy wonks have been toiling for years to propose politically and fiscally workable alternatives to Obamacare. Most of these experts are sharply critical of the new plan Trump is backing, which seems to be a kind of Obamacare Lite, with tax incentives that slightly favor the better off, and a different kind of penalty for those who don’t buy insurance. I lack the expertise to wade into the details and try to clarify them, but the principles underlying them are clear. There’s a fundamental moral problem at the heart of the healthcare debate, which various plans — Obamacare as well as its conservative alternatives — have flailed around trying to solve.

It’s the problem that economists call the “free-rider.” I can explain it best with a personal anecdote. Last week one of my deranged rescue beagles yanked the leash so hard that it messed up my right wrist. (I’m a righty.) The pain was blinding, throbbing, debilitating. I couldn’t write my column. It hurt to use the mouse for any reason. In a perfect world, I would have gone to a hospital emergency room to get immediate care — since making the arrangements to get into an orthopedist would have taken days, during which I couldn’t work (or even brush my teeth very effectively).

Emergency Wards Full of Illegal Immigrants

Of course, since I live in the real world and my sister is a nurse, I knew better than to go anywhere near emergency rooms — which are chock-full of people without any health insurance, many of them without the legal right to reside in this country, lining up to get routine care which they won’t ever have to pay for. Who would have to pay for them? I would.  When insured, paying customers do turn up at the emergency room, they must be soaked to cover the costs, or else hospitals will close. The sheer number of free riders force the “fare” paid by regular customers to crippling heights — and that is why after a childbirth or short hospital stay, you will see on your bill itemized charges like $20 Q-tips.

I didn’t want to come home with a bill that socked me for the whole cost of my annual deductible for a single injury, so instead of going to the doctor, I found a massage therapist and relied on Advil and ice baths. Thankfully, I got better. But it struck me as ironic that because I have a job and insurance, I have effectively less access to emergency care than illegal immigrants willing to wait several hours to get routine care from an emergency room — which typically won’t turn anyone away, even if there is little evidence of any genuine emergency. The New England Health Care Institute (PDF) warned back in 2010:

• The overuse of U.S. emergency departments (EDs) is responsible for $38 billion in wasteful spending each year.
• ED overuse is on the rise across all patient populations, irrespective of age or insurance coverage.
• Drivers of ED overuse include lack of access to timely primary care services, referral to the ED by primary care physicians themselves, and financial and legal obligations by hospitals to treat all patients who arrive in the ED.

Turning Doctors and Nurses into Indentured Servants

The numbers are surely worse today. The combination of federal laws and liability risk makes it very difficult for staff at emergency wards to simply say “No” to someone who turns up with an ear infection or flu symptoms, and wants to be taken care of — though they are quite unable to pay, and don’t qualify for Medicaid (since they’re illegals).  

Food is just as crucial to life as health care, but we don’t let hungry people turn up at restaurants and ditch the tab.

Congressman Ron Paul, MD, had the right answer to resolving this free rider problem. He shocked people in the 2012 presidential campaign when he said that the government should remove any legal or regulatory requirement that doctors or hospitals treat people who won’t be able to pay them, apart from obvious, life-threatening emergencies.

Rep. Paul was right. Food is just as crucial to life as health care, but we don’t let hungry people turn up at restaurants and ditch the tab. There is no moral case for drafting health care professionals into indentured servitude for those unable to pay. The fact that emergency wards are available for this purpose surely discourages a certain percentage of people who could afford health insurance from spending the money to get it. And of course, we should not be providing free medical care — except for life-threatening emergencies — to illegal residents at all.

Americans Who Game the System

So that’s one kind of free rider. But here’s another, home grown specimen. Someone I knew, a working attorney, churchgoer and political conservative, told me that he really resented the Obamacare mandate that he sign up for health insurance. He was healthy, young, and physically active. He didn’t like being pressed into the insurance pool to effectively subsidize older, sedentary people who needed care. So far so good, I guess.

But then I asked him why he didn’t sign up for some form of catastrophic insurance. What if he got in a car accident, or was struck down with some rare cancer? He didn’t have savings or assets that could begin to cover the real costs of health care he’d need. How would he deal with the bills that would come from hospitals and surgeons?

How many Americans are counting on Chapter 11 as their “insurer” of last resort?

At that he shrugged and smiled. “Oh, that’s what bankruptcy laws are for.” He explained that a number of his clients were uninsured adults who had faced enormous medical debts. He got bankruptcy judgments that let them pay pennies on the dollar. Apparently he took these cases not as cautionary tales but as inspiration.

Leave aside Obamacare’s absurd restrictions (which must be repealed) that virtually killed off catastrophic insurance plans, like the kind I used to have. How many young, healthy Americans who normally would shell out a few hundred dollars a month for catastrophic insurance don’t do so, because they are counting on Chapter 11 as their “insurer” of last resort? Morally, such people are no better than illegal immigrants who expect free medical care at emergency wards. In fact, as well-educated Americans with better options, they’re actually worse. Obamacare’s individual mandate was a ham-handed, probably un-Constitutional attempt to address this very real issue. It’s young, healthy people like my friend who make an insurance pool viable. If they don’t fear that medical debt could ever do them serious harm, many will not buy insurance. So the system will totter and fail.

No reform of health care in America will really address the fundamental problem of “free riders” jacking up costs for the rest of us unless it removes the legal obligation of medical professionals to work unpaid in non-emergency cases — and reforms bankruptcy laws that allow those who are willfully uninsured to essentially cheat the doctors and nurses who cared for them.

And now I leave it to the wonks to sweat the details.