What Can the Opponents Do About ObamaCare?
We’re not partisan at the National Center for Policy Analysis. We like good laws and dislike bad ones — regardless of which party enacts them. I believe we have been as hard on the Bush administration’s expansion of Medicare as we have been on the Obama administration’s new health law. That said, the hot topic of the moment is: What, if anything, can the congressional opponents do about the new health law? Here is my take.
Everyone expects the new Republican-controlled House of Representatives will vote to repeal ObamaCare. This move will probably be blocked in the Democrat-controlled Senate, however; and failing that, the president will use his veto pen to save the Democrats’ crown-jewel policy achievement.
Then what? As I explained at National Review Online recently, if President Obama is willing to open up the health care issue and get a sensible reform, everyone should cooperate. But if that doesn’t happen, I expect guerrilla warfare. Now it seems that Orrin Hatch agrees with me.
Every move you make Every single day Every vow you break Every word you say Every smile you fake Every game you play
Remember, the really important features of the law (mandates for individuals, fines for employers, subsidies for people entering health insurance exchanges) don’t kick in for several more years (in 2014). In the meantime, opponents don’t really lose very much if the best argument for voting for them in the 2012 election remains in place.
The health care reform bill is an albatross hanging around necks of the supporters. I suspect there are very few of them who want to cast an up-or-down vote on it again. And as long as it’s there (especially if it’s never really implemented), it will cost the supporters many congressional seats. Imagine that the start date keeps getting pushed back. Along the way, ObamaCare will be a big issue in every election. That scenario would be a nightmare for the supporters of ObamaCare.
There is precedent for this. Under the Balanced Budget Act of 1997, Medicare growth was supposed to be slowed by the gradual ratcheting down of payments made to doctors. Yet Congress has delayed these cuts for the last seven years. The so-called “doc fix” is always temporary, never permanent. The issue returns for doctors and for the American Medical Association every time we have an election.
Ideally, one hopes the two parties will work together to reform health care in a way that’s good for doctors and patients. And I would say the ball is in President Obama’s court. If he wants to open up the issue again, I suspect we can have sensible reform with bipartisan support. If not, there is a lot the opponents can do without the president’s cooperation.
They could begin by voting to repeal the most politically unpopular features of health care reform. That means no individual mandates, no individual or employer fines, and no regulations of the type that might cause McDonald’s to drop coverage for 30,000 low-wage employees and the 3M Corporation to drop coverage for all its retirees. If there is a budgetary cost for these measures, it can be paid for by pushing back what I am going to call O-Day. That’s the day (Jan. 1, 2014) when all the subsidies and mandates are supposed to kick in.
The supporters of ObamaCare will probably be able to block these moves, by either Senate filibuster or presidential veto. If they do, that will frame the issue for voters in 2012.
Then opponents could come to the rescue of senior citizens. If nothing is done, Medicare will have to reduce its payments to doctors by 25 percent on Jan. 1, 2011. In the succeeding years, reduced payments get really brutal.
According to Medicare’s Office of the Actuary, Medicare payments to doctors and hospitals will fall below Medicaid rates by the end of the decade. Think about what that means. Right now, Medicaid’s low rates make it difficult for low-income families to find any private-practice doctor who will see them. As alternatives, they often turn to community health centers and safety-net hospitals. Now imagine seniors having to do the same thing, but being pushed to the rear of the waiting lines, as even poor people (with their Medicaid cards) pay the doctors more than what Medicare will pay for the elderly.
The short-term goal of those who favor “repeal and replace” will probably be to push back the dates of these rate cuts by an election cycle or two. To pay for that action, they can try to push back O-Day as well. Just as the doc-fix problem gets postponed year after year, O-Day could be postponed again and again. If the supporters of ObamaCare resist, in each election the central issue will be: Do we want to put seniors on the ice floe in order to provide health insurance for young people?
Let’s hope Republicans and Democrats agree on Medicare reforms that will really control runaway entitlement spending. In the meantime, though, the goal of the opponents of the ObamaCare approach can be to cancel cuts that are never going to be made anyway and pay for the cancellation by delaying the implementation of ObamaCare.
What has created such a rich opportunity for the opponents of the health reform law is that the supporters hugely miscalculated in putting the health care reform bill together.
The main beneficiaries of the new law are 32 million to 34 million people who otherwise would have been uninsured. Another group of potential winners are those with preexisting conditions. Let’s generously estimate the entire group of beneficiaries at about 50 million people. That leaves about 250 million who are on the other side — expecting to lose more than they gain. Think about that. There are five losers for every winner under health care reform!
Even more interesting, the gainers are largely dispersed and disorganized. In fact, most of them do not even know who they are. Do you know if you will be uninsured four years from now? Few people do. The reason? Uninsurance is like unemployment: It affects people unpredictably for short periods of time. The health care reform bill promises to spend billions of dollars four years from now on people we can’t even identify today.
People who are going to pay for the reform, by contrast, are organized, focused and aware that they are in the target zone. If you work for a tanning salon, if you make wheelchairs, if you are a health insurance agent, etc., you may not know your exact burden, but you know that the law was not written for you. And seniors are politically focused and potentially organized.
A smart GOP cannot be the “party of no.” It will not merely exploit the weaknesses of ObamaCare. It will get firmly behind an approach to health care reform that its members will seriously be prepared to enact if the Democrats are willing. This would include a commitment to making health insurance portable, affordable and fair, and a willingness to solve our most important health care problems by removing perverse incentives, empowering individuals, and letting competition in a free marketplace control costs and improve the quality of care.
We need the party of no so we, we hope, can avoid becoming the country of O.
I am a senior, or about to be. And I hold seniors responsible for this mess. Too many seniors for too long actively and politcally resisted reasonable reforms. They were ably assisted, of course, by the late Sen. Kennedy and too many GOPers. So now, we’re on the brink of being bureaucratized to death, literally. 1984 is only a few years tardy, and George Orwell surely spins in his tomb.
As with any law, the Affordable Care Act will create winners and losers. Those getting coverage for less money than they otherwise would have paid are (arguably) the winners. Those expected to pay more than they otherwise would have paid are the losers. The problem with these arrangements is that the losers often resent being the source of benefit for the winners and may take their toys and go home. That is, if those who are healthy refuse to enroll and pay inflated premiums until they become sick, the risk pool for insurance will become unstable and premiums skyrocket. No risk pool can survive only insuring people at high risk for health problems. The unintended consequence is that there could be more losers than winners when the market for risk becomes destabilized as people attempt to game the system and wait to enroll until they become sick.
Devon Herrick states, “No risk pool can survive only insuring people at high risk for health problems. The unintended consequence is that there could be more losers than winners when the market for risk becomes destabilized as people attempt to game the system and wait to enroll until they become sick.”
The history of health care financing in the United States confirms that this unintended consequence has been disastrous. So what is the solution?
The Obama administration and the private insurance industry say the the mandate to purchase private insurance is the answer, providing that it is insurance that effectively pools risk.
Because of the inefficiencies, waste, and inequities of our fragmented, dysfunctional system of financing health care, those of us at Physicians for a National Health Program say that we should improve Medicare and then expand it to cover everyone. Not only would we have a single, stable risk pool, we would achieve true universality and create a beneficent public monopsony that would finally slow excessive cost escalation.
So what is there about insurance that is “portable, affordable and fair” that could ever avoid the destabilization of risk pools, yet ensure that everyone has access to affordable health care? Or do we care about everyone? (Those of us at PNHP do.)
I have little faith in Republicans unless they are forced to commit themselves to the complete abolishment of ObamaCare. Among other things one has to remember, it was under a Republican Bush that Medicare Part D was passed which was a tremendous expansion of government into the health care sector and will have negative implications for the economy as a whole and for reducing the debt.
Additionally over the years we have faced the problem of government’s intrusion into the health care sector over and over. There have always been grandiose plans to stop that movement, but when one looks at the results of these plans one only sees failure as our freedom continues to erode away as compromise after compromise is made. I would note that even though for the past 7 years there has been a doc fix that overall today physicians are in a worse position than 7 years ago and I believe are now less willing than ever to fight for independence.
Insurers can insure people with health problems, and survive, provided they charge the expected value of future costs. Take a look at New Jersey’s premiums to see a working example.
We should probably keep in mind the impact of this operational “state of purgatory” now created by the Hudson ruling has on those in the business of providing medical services as well as those financing those services. It is no less of a problem than the (now commonplace) public understanding of the negative impact on business planning created by the still undecided federal tax reality for 2011.
While it may be a good long term strategy to let the proponents of Obamacare swing in the wind and politically bleed to death over time, every month this inability to plan business strategies related to the financing of health care services is damaging to economic recovery and public confidence.
No one, including employers, administrators and insurance carriers (other than those who have invested in the Obamacare travesty) are willing to spend the money to create and market consumer directed programs until such time they know what rules are going to be applicable. Plan sponsors don’t know whether to ignore some or all the new rules, or to invest the time and money to comply. This state of leaderless legislative flux should be considered when strategy for repeal and reform is considered.
Good strategy. Glad to see the Republicans are listening to you.
Devon writes:”if those who are healthy refuse to enroll and pay inflated premiums until they become sick, the risk pool for insurance will become unstable and premiums skyrocket.”
There will be a once a year enrollment period just like Medicare. If you don’t join during the open enrollment period you take the chance of a uninsured catastrophic event occuring and a possible fine.
So you can pay $6,000 per year for insurance or $100,000+ for a single year with a catostophic illness (plus posibble fine).
“Choose your poison,” as they say
Nice musical pairing. Not sure keeping watch on them will get the job done, however.