Healthcare will Never be the Same
Obamacare is the law of the land, and it’s wreaking havoc across the land. To prevent it from doing more harm, it must ultimately be repealed. However, repeal or partial repeal of a law that has been characterized as “a government takeover of healthcare” will cause dramatic, unavoidable calamities within the healthcare delivery and insurance markets of our country. Republicans need be clear-eyed and honest about this.
The incoming president has promised executive action to help address the problems presented by repeal of the law. Perhaps it would be wise to approach the existing healthcare regime in whack-a-mole fashion, lobbing a presidential edict every time a new problem arises. That is what President Obama was doing. In fact, whack-a-mole might be useful in either case - whether the Affordable Care Act (ACA) is immediately repealed or Republicans in Congress can’t manage that and are forced to accept it going forward.
No one can operate under the impression that there are easy answers available. A “stable transition” would surely guarantee existing tax credits for purchasing health insurance but even the initial first step of transferring those tax credits directly to individuals instead of the current model of subsidizing health insurance premiums through the exchanges would significantly disrupt the health insurance industry.
In fact, such efforts are likely to be challenged by health insurers. Health insurance lobbyists helped write the law, negotiated on it behind closed doors, and supported its passage. They were eager to usher in millions of new customers forced to purchase their product, even if they would be heavily regulated by government officials to the point of becoming public utilities. It is only because their assumptions were wrong - young, healthy people did not have enough incentive to purchase their product - that they are now raising their voice, demanding bailouts, and leaving the exchanges.
The Republicans plan to do away with the individual mandate and still insist on prohibiting discrimination based on preexisting conditions. As Avik Roy and Kevin Williamson warn, this is a classic double-bind. These regulations are helping drive the cost of health insurance upward while guaranteed coverage is driving the cost of insuring more people upward, and the “individual shared responsibility fee” was supposed to pay for it. This house of cards can’t be salvaged by keeping the parts people like. And since the most popular parts of the law are not related to the federal budget, and therefore were not passed via reconciliation, they can’t be repealed with 51 votes in the Senate.
Republicans are getting ahead of themselves imagining a post-Obamacare world and they’re especially delusional if they think a simple repeal is going to take us back to life before Obamacare. There’s nothing they can do that won’t “pull the rug out” somewhere. And if they do nothing, as they acknowledge, this law will continue to collapse and hurt people. They’ve been especially reticent to provide any fixes to the law but working on an alternative won’t let them off the hook for the damage done in the meantime. That is why Donald Trump, the political leader of the party, took to Twitter to convey to Republicans that they must continuously remind the country that this all the Democrats’ fault.
That is the easy way out, though, and there’s no guarantee the country will buy it. At least some Republicans should show a little backbone instead. Getting elected is never a mandate for taking the easy way out. Addressing Obamacare is a tremendous challenge but it’s what they were elected to do. Those convinced “repeal and replace” will suffice may rest on their laurels, but Congressional and White House leadership should not.
This could be a balancing act of enormous proportion. Good policy and popular policy don’t always go hand-in-hand. What the American public wants - guaranteed issue, continuous coverage, “universal health insurance” - is difficult to provide without direct subsidies and direct control, without exchanges and mandates.
Guaranteeing insurance for more than 30 million people is exorbitantly expensive and regulating insurance companies in this manner is disruptive. Congress can provide tax credits, letting people keep more of their own money in exchange for purchasing health insurance, but that is no guarantee that Americans with suitable health insurance today will be able to keep the plans they have now.
We should just admit that Republicans don’t agree with the mission of the Affordable Care Act. It shouldn’t be replaced at all. Democrats will cry, ‘They want to go back to the way things were!’ I wish. There’s no going back, and the damage this law has caused will take years to undo.
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