08 November 2010

Repealing Obamacare

So a rallying cry for conservatives has been "repeal Obamacare!" Here's a pretty typical bit from Speaker-Elect Boehner:

I believe that the healthcare bill that was enacted by the current Congress will kill jobs in America, ruin the best healthcare system in the world and bankrupt our country. That means that we have to do everything we can to try to repeal this bill, and replace it with commonsense reforms that will bring down the cost of health insurance.
Now, everyone who follows politics knows that the Republicans could never actually just roll back Obamacare - no simple "repeal" could ever go through. It's just way too toxic to try to tell people that young adults can't be on their parents' policies, that companies can discriminate against pre-existing conditions, and that you can't buy insurance over state lines. Fixing those issues were wildly popular provisions that everyone supports, and it would be absurd to try to eliminate them.  Such a move would be ready-made for deadly attack ads by a hungry Democrat:

"Senator Cantor voted to keep people with cancer from getting health insurance.  Senator Cantor: no friend to the sick."
So leaders like Boehner have instead advocated we "repeal and replace" Obamacare.  This means getting rid of all of the unpopular aspects of the law, like the mandate that forces you to get insurance and the price controls that limit insurers' abilities to vary their rates.  Those are bogeyman "big government" parts of the bill that are easily attacked and that no one really likes.  "No government should be telling you what insurance to buy!" goes the pitch, and it's easy to sympathize with the notion.

The problem is that it is a crazy fantasy to think you can get rid of these unpopular parts and only keep the popular parts.  It just wouldn't work.  Here's why.

If you had a pre-existing condition before the reform, often you could only get hellaciously expensive insurance. If I had lung cancer, the insurance company would either reject me outright or charge me extremely high premiums with very high co-pays, because I'd be a lousy bet. Insurance, after all, is akin to a gamble by the agency (and by yourself): they're hoping you'll pay for it for a long time and never need it, and you're hoping you can pay as little as possible without needing more than you pay for in the future. If I had lung cancer, I'd almost certainly pay them less than I'd get back in benefits, so the insurance company essentially would have to turn me away so they can stay in business. They only want to make good bets.

Reform means that they can no longer turn me away, and can't vary their rates by however much they would like to do so. If I get lung cancer, I can still get affordable insurance. If companies could vary their rates, they'd raise them sky-high. So they can't, and no matter how sick you are, you can still get affordable insurance (in theory, at least).

But the problem is that this means that no one would get health insurance until they get sick. Why would I pay for insurance when I'm healthy, when I know I can still get it for a good price when I'm sick?

So the bill also included a mandate. Everyone has to get insurance. I can't wait until I'm sick. Essentially, all the healthy people in the country help pay into the system to offset the benefits that go to the sick. It's a lot like Social Security, where all the young people help pay into the system to offset the benefits that go to the old.

You may not think society has a responsibility to the sick or the old, but that's a whole 'nother kettle of fish, and few others agree with you.

This mandate also means that a plan that's insurance in name only (like McDonald's plan for almost all employees, which will pay a maximum of $2,000 yearly in benefits) doesn't count as real insurance. Otherwise everyone could get fake "insurance" that cost almost nothing and covered almost nothing, and it would be about the same as having no insurance for all intents and purposes.

So things like the mandate and cost controls may be unpopular, but they are necessary. You can't pay for the popular things without them.  If you try, you send the whole system into a crazy spiral of death in very short order.

But sure enough, we're getting "leaders" in the GOP who are vowing to try to send us into that very death spiral. Rep. Joe "We're sorry, BP" Barton (R-TX) is about as explicit on the matter as anyone could be:

Delivering the goods should start with oversight hearings into exactly what went so wrong and the repeal of everything after the enacting clause of the law that set ObamaCare in place. The individual mandate, employee mandate, abortion funding, the tangle of outsider/insider councils like the comparative effectiveness board, and the effective nationalization of health care under grants of authority to the Department of Health and Human Services: All of those have to go. I hope we can move a repeal bill through the House in the first 90 days.

Next, we need the thoughtful creation and passage of healthcare reforms that make sense. I particularly want to ban insurers from rescinding coverage when their policyholders get sick and need to use their insurance. ... Purchasing health insurance across state lines is another reform that’s overdue.
There's a little more, calling for restoring the cuts to Medicare Advantage, higher payments for doctors, and so on. But what you won't find are any real solutions to pay for all these things Barton's demanding. And that's not too surprising, because neither Barton nor any other GOP leader actually intends to do these things. They can't pay for them, because there really aren't any possible ways to pay that haven't already been denounced as socialism by GOP leaders. Things like a single-payer program or a public option are good ideas. But when the Stupak group of Senators met and the healthcare summit met, those ideas had to be unacceptable: the Republican party had decided they were just going to stonewall and try to run the clock out like in the Clinton administration. They failed spectacularly, but are trapped by their rhetoric (some of them even believe it).

So they can't repeal the unpopular bits like the mandate and keep the popular bits like no discrimination, because it isn't plausible on its very face.

Mark my words: the GOP will back some obvious and small reforms, like easing the 1099 requirements for small businesses, and probably also try to ram through a tax cut that is at least distantly related to healthcare. But Obamacare won't be meaningfully replaced and certainly won't be repealed. The Republicans just don't have any feasible ideas to do so, even in their wildest op-ed dreams.

No comments:

Post a Comment