Hurray for Health Reforms by Paul Krugman

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The Affordable Care Act or Obamacare to some has its proponents and opponents. Those who support this bill cite better healthcare for the poor as their major point.

In my chosen article, Hurray for Health Reform, Paul Krugman presents several arguments for this bill (Krugman par. 2). Though they are good arguments, I do not entirely agree. There is a downside to this bill and the writer ignores this in his article.

In his first paragraph, the writer points out that the Affordable Care Act can be judged as good based on its opponents. He forgets that the law-making process is highly political; there must always be proponents and opponents. In this case, Democrats are the proponents and Republicans are the opponents.

Therefore, this is not a good criterion to judge whether this law is good or not. If Republicans had proposed the bill, obviously Democrats would have found political reasons to oppose it, no matter the content. This is because every political party is trying to create a good image in the eyes of voters.

Towards the end of the second paragraph, the author dismisses the arguments against the Healthcare Reforms as dishonest. This is a judgemental comment. Some of the opponents of the bill have very genuine reasons. He has not taken the time to understand why they do not support ACA.

I believe nobody would willingly want to deny other people healthcare. However, all the logistics must be considered before making such a decision.

The writer alleges that it is unfair when insurers are left free to decide who is covered or who is not. This is partly true, because businesses aim at making a profit and insurance is a business too. However, in the same breath, health insurers have to limit their risk to a certain extent or they will soon run into financial trouble.

When insurers run into financial trouble, everyone suffers. This was displayed clearly by the finance industry when AIG collapsed and had to be bailed out by the government. The writer also fails to recognize that young people who need the cheap cover more than the old do.

Many young people are unemployed or struggling in their first jobs. In contrast, many older people are financially stable with steady sources of income. Such people can afford to purchase any health insurance they need. Obviously, the health risk increases with age, therefore insurers charge higher premiums.

Nevertheless, the fact is that older citizens, having worked all their lives, can afford these premiums. Younger citizens need lower, affordable premiums. Insurance firms should not be criticized for creating products specifically for young adults. They are merely trying to serve the bulk of the countrys population currently.

In New York, insurance firms are required not to turn away people with pre-existing conditions. These are long-term or terminal diseases have already been diagnosed. The writer claims that this is not an effective policy.

I believe that this policy has helped many people with pre-existing conditions to purchase insurance. The premiums are high due to the expenses involved in treating such conditions. However, in the end, it is usually cheaper for such patients to pay for insurance than to cover their own medical bills.

This is another case of insurers trying to help but appearing as the villains. We must not forget that insurers have to make a profit too.

The compulsory requirement that everybody purchases insurance is not fitting for this age. The government cannot force people to buy products, and insurance is a product. In this article, the writer argues that this compulsory requirement and the subsidies provided by government will solve Americas health problems.

This is far from the truth. Actually, Americans will end up spending more on healthcare. The subsidies are obtained from taxes, which are collected from citizens. The same citizens are expected to pay compulsory premiums but obtain only basic healthcare.

If they need additional care, they need to purchase alternative cover and pay more premiums. This leaves them in a worse situation than before. Given the current harsh economy, this cannot be the best solution for American healthcare.

The author reminds us that this bill is meant to aid the Americans who fall through the cracks of the healthcare system. However, he fails to tell us that these are approximately 48-51 Million Americans. This number is quite huge. Trying to service all the health needs of everymen may turn out to be more difficult than the author portrays.

If all these people were to be put under compulsory cover, the profit margin for insurance firms would reduce to barely 15%. Many private insurers would have to close down. This industrys profitability would no longer be attractive.

If the government enacts legislation that makes the insurance industry unattractive to private investors, it may have to carry out the insurance functions itself. The government is not an efficient use of resources.

Neither is it an efficient provider of services. This is evident in public schools. If the government ends up as the sole or majority insurer, this industry would be in absolute chaos.

Finally, the author seeks to convince us to ignore the cost of this scheme (Krugman par. 6). He informs us that projections indicate that the actual cost of implementation has reduced slightly.

However, billions of dollars it will cost the government over the next decade is conveniently left out. The government is already operating on a deficit budget. An additional 900 billion will be hard to source.

Investors have also lost faith in the government with its reduced credit rating. The only alternative would be taxes. These will obviously make life harder for the citizens.

In conclusion, the writer does a good job of defending this legislation. He argues that the poor will benefit and everyone will have access to basic healthcare.

However, he ignores the important issues of the effect on the insurance industry and the cost of implementation. For these reasons, I do not agree entirely with the contents of this article.

Works Cited

Krugman, Paul. Hurray for Health Reforms. 18 March. 2012. Web.

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Hurray for Health Reforms by Paul Krugman

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