The Rush to Repeal

REPUBLICANS ARE AFRAID HEALTH-CARE REFORM WILL WORK

Liberals may lament the administration’s failure to make progress on immigration and climate-change legislation in this congressional session, but it may be time to shift energies to protecting what has already been passed. 

The health-care reform bill—the Patient Protection and Affordable Care Act—for all its flaws, truly is a historic accomplishment, one that had eluded the country for three-quarters of a century, and passing it was brutally difficult. But that was not the end of the struggle, for Republicans are determined to repeal the law. While there is almost no possibility that they could pass repeal over an Obama veto, the law will be vulnerable until 2014 when it is fully phased in. Repeal will be a major plank in a Republican platform to regain the White House in 2012.

An early salvo in the repeal campaign has been fired by the Cato Institute, a Washington think tank dedicated to the belief that any problem can be solved by lower taxes and fewer regulations. Not surprisingly, Cato dislikes almost everything about the new law, and has compiled its complaints in a white paper, Bad Medicine (www.cato.org/bad-medicine). Cato has two distinct classes of dislikes. The first is the fear that the law will be effective, which I found quite heartening. The second relates to various cost concerns, many of which are valid.

Cato is worried the law will “fundamentally reorder” the health market and convert insurers “into something resembling public utilities, privately owned” but with profits and offerings heavily regulated. (No more dropping people who get sick.) And they warn that “insurance coverage will be extended to millions more Americans as government subsidies are expanded deep into the middle class.” Well, good.

Subsidies to individual purchasers will be through refundable tax credits, much like the current Earned Income Tax Credits, on a sliding scale that phases out at 400 percent of the official poverty line. To use Cato’s example: the out-of-pocket cost of insurance for a family of four with annual income of $30,000 would be limited to about 3 percent of its income, or under $1,000. For a family with a $65,000 income, the out-of-pocket cost would rise to about 9.5 percent of income. That seems fair and sensible.

A similar set of tax-credit subsidies applies to small employers, provided they pay at least half the cost of their employees’ insurance. The government will also reinsure small employers with workers over fifty-five to protect them against bad-claim experiences. 

The subsidy carrots also come with mandate sticks—financial penalties if either individuals or employers fail to comply with their obligations to purchase or provide insurance. Cato detests the idea of mandates and penalties, but also points out that the penalties may be too small to be effective. (They neglect to mention that the mandates and penalties were a Republican idea in the debates over “Hillarycare.”)

When the law is fully phased in, every state will provide an insurance “exchange” offering low-cost health insurance to anyone who can’t get a better deal at work. Cato worries that many employers will choose to offer the exchange option, which could result in “a far more extensive government intervention in the insurance market.”

What does Cato fear? Assuming most states take the exchange mandate seriously, a half-dozen or so highly successful experiments are likely to emerge—perhaps Kaiser-type combinations of good medical supervision, cost control, and adherence to best-treatment protocols. Successful programs would be replicated in other states—there is no mystery to how Kaiser achieves its results—and over a decade or so the bottom 60 to 70 percent of the population could migrate into such programs. Sounds awful, doesn’t it?

That’s the good news. But there are some big holes. The real poor, who can’t afford to pay for subsidized individual insurance, will be shunted into current Medicaid programs. I say “shunted,” for many Medicaid programs offer genuinely substandard care, mostly because fee schedules are so low that fewer and fewer doctors participate. But the law also provides for a large expansion of community health centers, which could pick up the slack, and save money besides. 

All other costs are probably seriously underestimated, as well, but as Princeton’s Uwe Reinhardt notes, the world record for cost underestimates is still owned by the Bush Medicare drug program. The truth is that reining in health-care cost growth will be a long process that will involve, among other things, limiting taxpayer support for unproven technologies.

The net of it is, for all the might-have-beens, the new health reform law is a watershed achievement. The law will be vulnerable for years to come, but repeal would be a tragedy.

 


Related: Read more of our health-care coverage here.

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So this is a libertarian organization that attacks policies of both Democrats and Republicans, and yet the subtitle indicates that this is an article about Republicans, and a comment like this: "They neglect to mention that the mandates and penalties were a Republican idea in the debates over “Hillarycare" is inserted as if to indicate hypocrisy. That's not hypocrisy for non-Republicans to attack a Democrat's policy without failing to acknowledge that the idea came from a Republican.

This is a ridiculously poorly edited piece and it's full of misleading attacks. Shame on you.

Family and I have  Been in Kaiser for 55 years.. could not have been better.. all are healthy .. in the 50s it was called socialized medicine... as if it had any Government money backing.. the lies about HMOs continue.

What if you were told today that Obamacare would cost over 2 trillion dollars? How about 3 trillion dollars?  Would you still be for it? Medicare is trillions in debt. Is spending money we don't have social justice?  Is there anything else you would like so we can add another trillion?  Would you like to do away with the Defense Department?  I see nothing the matter with your dreaming in this article, in fact, feel free, but not with my dime. Why don't we make it voluntary for those Americans like you who want to contribute to Obamacare to send money every year to the cause.  Guess how much would be contributed?  A dreamer with other people's money - that's what I see in this article.

I have been in the health benefits industry for more than 30 years, both as a senior partner in a world-wide consulting firm and as a senior vice president of a healthcare company.  It is true that the healthcare legislation passed by Congress and signed by President Obama was a watershed moment.  However, don't be mislead by the altruistic and financial argumentations.  The CBO has underestimated the cost and overestimated the savings.  Consider that the $300 billion Doctor Fix was not included in the numbers.  More importantly, there is nothing really new and effective in the bill that will control costs.  The Repulicans will reform the law, most likely with a graduated approach.  The new law is not perfect nor will any reformation of it.  If history is any indication, politics will see to that.  Hopefully, we will learn by pass mistakes and pass real reform.  The issue is complex but the solution is within reach.  The most important issue is one of affordability.  Clearly, the poor and near poor need assistance and access to health care coverage.  The industry is in need of responsible regulation.  Stop thinking Repulican and Democrat, its about practical common sense.

Ah, yes 'practical common sense.' Didn't see any of that coming from the health industry or their neocon naysayers. When the President convened the health summit just before passage, he was indeed seeking discussion and some common sense and purpose. He was terribly rebuffed. What are we about as a society when we cannot talk about providing a basic level of health care for all our people? Is $300 billion too much to spend when we easily give banks $800 billion and prosecute a senseless and useless war costing over $1 trillion? Maybe we could, after the election, sit down together and talk about cost containments, the price of a Mercedes for every doctor, fair billing, catastrophic illness and injury, basic preventative health care. Seems there might be a lot of fruitful possibilities. Repeal is not one of them.

We are not only talking about breaking a law with freedom of killing babkes (because that is murder even though the mother may plead  that there is no father and she lives in poverty) but GOD's laws of not killing the innocent or any human being.  God created us and each child is precious in His sight.

We will follow the laws of God before throughing ourselves under the sword that Obama is carrying.  He has completely mis-stated and mis-interpreted the Constitution and Scripture.  He wants to make it easier for teens to get abortions.  I pray that he is defeated in this.  I completely reject his idea of making religious Doctors (Catholic and non Catholic) do abortions when their faith tells them it is wrong.

Stand firm!!!!

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About the Author

Charles R. Morris, a Commonweal columnist, is the author of The Two Trillion Dollar Meltdown (Public Affairs), among other books, and is a fellow at the Century Foundation.