Baseball Crank
Covering the Front and Back Pages of the Newspaper
February 3, 2010
POLITICS: After Obamacare: What Do Conservatives And Republicans Want on Health Care?

Democrats trying to defend their flailing healthcare bills have tried, repeatedly, a two-pronged attack on the mostly united Republican opposition to the various plans floated by the Senate and House Democrats and the Obama White House. One is to suggest that Republicans are criticizing the proposed Democratic solutions without having any of their own - implying that there really is no other choice but to pass a Democratic bill and that Republican opposition is irresponsible. The other and related contention is to argue that Republicans have a responsibility to cooperate in bipartisan fashion on the bills currently under consideration, rather than seek those bills' defeat.

These arguments are useful as political spin, but they are wrong. Moreover, they ignore the fact that the GOP has opposed the healthcare bills with much the same strategy employed by the Democrats against George W. Bush's effort to reform Social Security - which almost certainly resulted in the destruction of any chance in the foreseeable future to fix Social Security's fiscal problems or even prevent them from getting worse - as well as by forces both Right and Left against the Bush-McCain-Kennedy comprehensive immigration bill.

For the uninitiated, here's a sampling of what conservatives and Republicans do think about health care. I can't speak for everybody, but I think I can explain in general what the majority of the Right thinks and wants on this isue, and why it precludes most if not all elected Republicans from supporting any comprehensive healthcare bill built along the lines of those floated over the past year:

1. The System Is Not That Bad: The fundamental disconnect starts at the beginning: by and large, most people on the Right think the United States has a great healthcare system, the best in the world. Pretty much nobody thinks the system is perfect: there are lots of skewed financial incentives, lawsuits are too expensive and prevalent, costs are excessive in some parts of the system, and there are, in fact, too many people who don't get care they need. The system is messy in much the same way that democracy and free markets are messy, and similarly in need of constant tweaking. But the general feeling among conservatives and Republicans is that while you might make fundamental changes in the structure of the system if you were starting it from scratch, when you're dealing with the system as it is, the best thing to do is work around the margins rather than launch a massive federal takeover of the whole shebang that rewrites every aspect of the system from Washington with no possible way to anticipate how all those changes will play out.

That very premise is the basis of the deep divisions over this issue, and helps explain why the further the process has advanced, the more public opinion has favored the opposition, despite the generalized initial public sentiment that "reforms" should be implemented. If the voters are leery of drastic, comprehensive systemic "reform" now that they have had time to see what it looks like, they will naturally prefer doing nothing at all. Maybe the opportunity won't come this way again soon to do a fundamental overhaul of the system, but there's always a next year to do smaller, more incremental bills that work around the margins. That's precisely why the GOP has suffered no political damage for not having its own comprehensive plan - GOP solutions like permitting insurance to be sold across state lines are piecemeal and can be enacted as such without having to get all the moving parts into the same bill.

This is the diametric opposite of President Obama's position. As the President put it in last week's State of the Union Address:

There's a reason why many doctors, nurses, and health care experts who know our system best consider this approach a vast improvement over the status quo. But if anyone from either party has a better approach that will bring down premiums, bring down the deficit, cover the uninsured, strengthen Medicare for seniors, and stop insurance company abuses, let me know. (Applause.) Let me know. Let me know. (Applause.) I'm eager to see it.

There you have it - he's only willing to consider an alternative proposal if, in his view, it reduces premiums and reduces the deficit and covers all the uninsured and "strengthens" Medicare, and clamps down on "abuses" by insurance companies - even a proposal guaranteed to do any one of those things is unacceptable.

That's a recipe for giving Republicans no choice but to simply say "no." But it doesn't mean the GOP, if it took control of Congress, would be unwilling or unable to present the Obama White House with bills that could address particular problems with the system.

2. What Matters Is Health Care, Not Health Insurance: The core concept behind comprehensive reform is that the federal government has a responsibility to eliminate with one fell swoop the estimate tens of millions of people (nobody knows the real number) who lack insurance. This is one reason why the Democratic plans all include a mandate that compels citizens to purchase insurance, and why they also include a battery of other interlocking provisions designed to control the allocation of risks, the imposition of costs, and the terms on which insurance can be offered or coverage denied. Despite all of that, it remains questionable whether the uninsured would truly be eliminated under any bill on the table - to pick two examples, illegal aliens may be hesitant to claim coverage (and could be barred from coverage, depdning how one reads the bills), and if the less onerous penalties for refusing to buy insurance are selected (the Senate bill won't criminalize refusing to participate in the mandate; the House would), some young, healthy people will just pay the fine and opt out of the system.

Is it worth disrupting the health insurance arrangements of the insured majority to extend coverage to the uninsured minority, and perhaps not even all of the uninsured minority? To answer that, you need to remember that what matters isn't insurance, it's care - the sole purpose of health insurance is to secure access to health care.

And people without insurance in this country still get health care, often from sources like clinics and emergency rooms. Not all the care they may want or in some cases need, nor the best or most cost-effective care. And of course, not everyone with insurance receives perfect care either. Many of the distinctions between the insured and the uninsured are differences of degree. Moreover, many of those who lack private sector insurance are covered under Medicaid or Medicare.

Conservatives don't argue that this is an optimal situation - but we do argue that in light of these realities, it's entirely acceptable to focus on solutions that improve access to both insurance and care, rather than guaranteeing insurance. If you can reduce genuinely unnecessary barriers to competition and low-cost insurance, if you can provide better ways for people to shield assets from taxation to spend on healthcare - these are goals that can reduce the number of people who lack insurance, without necessarily having to come up with a single magic bullet that claims to eliminate the lack of insurance overnight.

3. Let A Thousand Flowers Bloom: A fundamental objection to Obamacare in its various forms is that by enacting a vast new federal regulatory and entitlement structure, it freezes the entire industry in amber in ways that will choke off the possibility for future revisions. The political trauma of the efforts to enact this legialstion only underscores the extent to which politicians will be unwilling to revisit comprehensive changes in the future. If it passes and doesn't work out perfectly - and how many government programs do? - neither the states, nor the private sector, nor in all likelihood future Congresses will be able to fix it. Like Medicare, it will simply run on autopilot forever more.

This was one of the objections Scott Brown raised in the Massachusetts Senate race: Massachusetts has its own statewide system of "Romneycare," which had many similarities to the federal program. But the Massachusetts Legislature today remains free to alter or repeal or defund Romneycare, much the way that Tennessee's Democratic Governor Phil Bredesen has done with TennCare, the system originally modeled after Hillary Clinton's health care plan, when it grew too expensive for his state.

The states are, in Brandeis' term, the laboratories of democracy for at least two reasons. One, multiple states can try differing approaches, and learn from each others' experiences - whereas once the federal government acts, innovation is at an end. Two, states do not have the federal government's budgetary processes - many have balanced budget amendments or other constraints on deficit spending, they have to compete with rival states to keep taxes reasonable, some have line-item vetos, zero-based budgeting or other tools Washington lacks for revisiting budgetary decisions annually, and the partisan/ideological temperature is lower in many statehouses. When forced to make genuine choices among competing budgetary priorities, states can't just choose "all of the above."

The diversity of state and private-sector approaches is also evident in the debate over rationing of care and whether this will lead to government "death panels." It is true that rationing in one sense or another - that is, decisions to forego some care on cost/benefit grounds - will occur in any remotely fiscally responsible healthcare system. It is arguable, even, that not enough rationing is done today. Ideally, rationing should be done by the consumer, as happens in any field where consumers, rather than insurance intermediaries, make purchasing decisions; as Wisconsin Congressman Paul Ryan, the GOP's go-to guy on health care these days, explains:

Rationing happens today! The question is who will do it? The government? Or you, your doctor and your family?

... what I'm saying is that rather than having government ration care to manage decline, let's take those market signals that work in every sector of the economy to reduce cost and improve competition. I got Lasik in 2000. That's a cash surgery. It cost me $2,000 an eye. Since then, it's been revolutionized three times and now costs $800 an eye. This sector isn't immune from free-market principles.

What's particularly menacing about putting rationing power in the monpolistic hands of the vast, impersonal and bureaucratic federal government is, again, that it eliminates the possibility of competition or outside supervision putting any counterweight on the desire to control costs. It's possible, of course, that the federal government will respond to concerns about rationing by being profligate, but that presents the opposite problem of hemhorraging money. Either way, the system becomes much less fluid when a single actor with the coercive power of the state behind it is calling the shots.

Even where the GOP has more ambitious proposals for reform, they are not based on top-down diktats from Washington; Ryan argues for a broader, less incremental approach than many in the party, but his proposals would operate by gradual, voluntary reform of existing structures through the market, rather than an avalanche of new regulation driven from a single office in the capital:

We set up state-based exchanges. You don't have to participate in the exchange if you don't want to. You don't have to sell it in the exchange if you don't want to. I don't want a closed system that will gravitate towards more government control. I want it to be decentralized that has regulatory competition and market competition. You can be in or out of the exchange, which keeps everybody honest.

Note the emphasis on avoiding individual or employer mandates, thus avoiding the most freedom-encroaching aspects of Obamacare while also eliding the major Constitutional objections to compelling people to buy a private company's products, as well as the essentially corrupt nature of tethering individuals to a government-compelled relationship with large insurers.

4. This Is Still America: The final really core disagreement is that many Republicans and nearly all conservatives object on principle to making health care a fundamental entitlement guaranteed by the national government. Experience the world over shows that health care is one of the most critical tipping points in altering the relationship between the citizen and the government in cradle-to-grave social-welfare states on the European model (when people call Obama a "socialist," this - along with de facto direct government control of major industries - is what they are thinking of). Having health care systems run at the state level is bad enough, but having them uniformly dependent upon Washington for funding and regulatory favor simply takes too many of the most important things in life and puts them in a single pair of hands. That's not the American Way, and if that sets us apart from other nations, it should.

When all is said and done, when 2010 has - as it seems increasingly likely - come and gone without the passage of a sweeping comprehensive federalization of health care, Republicans in due course will offer, and will need to offer, constructive solutions of their own that can marshal support across the GOP and, hopefully, in some cases across party lines. But what will be clear is that those solutions will not be just mirror images of the Democrats' vision. They will instead reflect these core distinctions: incrementalism over one-bill-to-rule-them-all; a focus on increasing access and decreasing cost rather than making sweeping guarantees; avoidance of coercive government mandates; and diffusion of power among consumers, states and businesses rather than concentration in Washington.

After Obamacare, we can stop pretending that a handful of experts in Washington know better than the rest of the country. After Obamacare, we can return to debating solutions more in line with traditional American values and American ways of solving problems by the trials and errors of a free people. After Obamacare, the goals will be more modest, but more realistic. After Obamacare, health care reform will still be possible - but only if President Obama abandons his utopian schemes and looks at the kind of solutions that Americans have long regarded as common ground.

Posted by Baseball Crank at 6:28 PM | Politics 2010 | Comments (21) | TrackBack (0)
Comments

Crank:

Thought you might want to know that this entry isn't hitting the RSS feed in My Yahoo!

Good analysis.

Posted by: Joel in Seattle at February 4, 2010 7:44 PM

I agree that the health care system doesn't require a "public option" or an excessive amount of government intervention (and certainly not one costing $871 billion). I've been hoping, and continuing to hope, that would ultimately result from Congress would be a much watered-down and reasonable proposal. I won't hold my breath.

Nevertheless, the Republican party has never convinced me that it either knows enough about the health care problem or is willing to tackle the kind of issues that make some measure of government intervention necessary. This is probably because, as you note, the party doesn't think the health care system is all that bad in the first place.

They constantly beat the drum of tort reform when the best evidence is that the cost of health care is due in large part to the price of innovation. Moreover, they take doctors at their word when they say that they are practicing defensive medicine as opposed to ordering tests of dubious necessity for the sake of profit.

I don't reject Republican suggestions by any means - exchanges, open competition across state borders, tort reform - all fine, but don't pretend its any kind of significant fix.

All I want is a plan that spreads out the cost of all this innovation without killing it and without the government setting prices. And you have to solve the portability and pre-existing condition problems.

I would be happy to accept the government establishing some simple rules of the game, and let the market due the rest. I have no problem with the government making a *minimum* level of health insurance mandatory - limited to catastrophic care, since that's where the big costs are, and let the market take over. People paying even a minimum amount when they are young and healthy will go a long way to reduce costs. And in return, the insurance companies have to insure regardless of pre-existing conditions.


Posted by: MVH at February 5, 2010 12:37 PM

Correction - that should be "do the rest."

Posted by: MVH at February 5, 2010 12:40 PM

In general I agree with MVH's except I won't support mandatory health insurance in any form. No way, never. This is not a right we have given the federal government to lay on us. You can't throw someone in jail or fine them because they want to pay for their own health care by themselves. Yes, this means that the rest of us will get stuck (usually too often) with the bills of others. But I'd rather find a way to deal with that then state letting the feds start passing laws such as this.

However, we should keep in mind the real purpose of Obamacare is not really about health care but about extending his socialist agenda further into America lives. That is why if it isn't health care, it will be something else he will try to take over. Hence why I am hoping for change!

Posted by: lee at February 5, 2010 1:22 PM

"You can't throw someone in jail or fine them because they want to pay for their own health care by themselves."

It's not terribly different than requiring no-fault auto insurance at the state level. It it's truly restricted to catastrophic care, then the expense really shouldn't be that onerus.

Also, the problem is, for truly catastrophic care, the young *can't afford* to pay their own health care costs, and they just pass on the costs to the rest of us when they wind up in the hospital with some life-threatening condition. I don't think it's unfair at all.

Of course, if federalism and subsidiary is your real issue, then there is nothing that would change your mind.

Posted by: MVH at February 5, 2010 1:48 PM

MVH - the critical difference is, if I don't want to be forced to buy auto insurance, I have the option of not driving. If I never drive, I never need insurance. The same does not apply to health care - I can't opt out of injury and illness.

Posted by: Joel in Seattle at February 5, 2010 2:36 PM

Joel,

True, you can't opt out of injury or illness, but it's also true that hospitals can't opt out of treating you if you can't afford it. If we were going to make it really fair, hospitals would be able to deny care for those who can't afford to pay for their serious injuries. So if you were young with not much money and came in to the ER needing brain surgery from an accident, they hospital could let you die instead of treating you.

Since this will never happen, the young who choose to remain uninsured will free ride on the system when it comes to catastrophic injury. I woudn't call that the American way, either.

Posted by: MVH at February 5, 2010 2:47 PM

MVH,

You are missing my point. I am willing to look at ways to handle those who can't pay. What I am not willing is allowing the Federal government to start throwing people in jail for not doing something the consitution does not allow.

For example, until the 16th amendment to allow income tax, the congress could not impose one. Until the 18th amendment, congress could not outlaw liquors. So until we make an amendment to allow the government to force us to have health insurance, then I don't want any such law.

As for helping people pay for health care (not health insurance), I propose that we allow private charites to accept tax-free donations so that people who can't afford care, can get it paid for. Keep the government out of it! Let our already existing system of private charities step in.

The people who feel so strongly that they should help others have their health care paid for can contribute. Don't force me to pay for others care if I don't want to.

This idea that just because some people think "it is the right thing to do" and then have the government force the rest of us to go along with their beliefs in wrong. That is why I am so against government funded abortions! Other people's idea of right and wrong are being forced on me!

Posted by: Lee at February 5, 2010 5:38 PM

If you purchase health insurance you are already paying for the cost of other people's care. Part of your premium pays for the care given to those who are uninsured and cannot pay their own way. Just because it is not stated as such on your bill does nothing to lessen the truth of that matter.

Simply living here in this country requires everyone to deal with the fact that some of your, mine, his, her's, etc. taxes are going to programs, initiatives, ventures, operations and whatnot that one might find morally objectionable. I bet the government (in general) literally does hundreds if not thousands of things you detest. Those things are already being forced upon you. I'm against wars that kill thousands of innocent people but my check is cashed the same way your's is. It would be great if government were a la carte and you could just check off what you wanted your $ to go to. Not the way it works though.

Posted by: jim at February 5, 2010 6:26 PM

Lee,

"What I am not willing is allowing the Federal government to start throwing people in jail for not doing something the consitution does not allow."

By saying the Constitution "does not allow" it, I assume you mean that you don't want the federal government doing what the plain text of the Constitution does not state. Otherwise, under current jurisprudence, government regulation of health care, as proposed, wouldn't be declared unconstitutional by the Supreme Court.

As for the fines and jail, I wouldn't choose jail as a penalty, but perhaps a fine equal to the cost of that health care and also the denial of eligibility for other federal benefits while that person was uninsured.

Donations to *non-profit* hospitals are already tax-deductible, but I doubt those donations are even a fraction of what would be necessary to cover the treatment of the uninsured for catastrophic care.

Posted by: MVH at February 7, 2010 8:41 AM

MVH,

Ok, so they just get fined. How does this work? Let's say the person does not have the $s to pay for health Insurance, fining them is not going to help.

So now you setup a some levels like income taxes where people pay based on income. Now we get into the old "exemptions" and "loopholes" issues. Special interest groups (like Unions) get exempted from paying "luxury" health insurance tax. So we are back in the influence game again. That has worked real well for income taxes!

OK, so some how the ferderal government collects the $s, how do they dole it out? They offer health insurance (like medicare) to those who can't afford it. How do they decide who can't afford it? Again, the Congress sets up all kinds of rules.

So what is better? That is the crux of the question! That is why we need fair, open debate on how to make Health Care (not insurance) more affordable. Not the BS that is now going on.

Posted by: Lee at February 7, 2010 9:30 AM

"OK, so some how the ferderal government collects the $s, how do they dole it out? They offer health insurance (like medicare) to those who can't afford it. How do they decide who can't afford it? Again, the Congress sets up all kinds of rules."

My answer is this - if you don't qualify for Medicare, then you can afford the catastrophic insurance. Keep in mind, I'm not talking about requiring comprehensive medical insurance, just catastrophic insurance - which is far cheaper than what's being bandied about Congress. I'm not expecting the insurance premium to be that onerous.

You could also adjust that premium based on age. Let the insurance companies come up with a table - that way the young won't have to pay as much at the outset.

As for fines collected, ideally I'd have them used to pay off the debt, and structured that way from the beginning. I can understand the temptation for Congress to divert those funds at a later date, so maybe a denial of any kind of federal benefit would work in lieu of a fine.

Posted by: MVH at February 7, 2010 11:41 AM

"if you don't qualify for Medicare, then you can afford the catastrophic insurance."

So I looked to see how you become eligible for Medicare. There are basically2 ways: Be 65 or older or receive SS benefits. How do you receive SS benefits under age 65? Well it seems pretty complicated when I filled out the questiionaire but basically you need to be diabled or dying of End-Stage Renal Disease.

So who is the group of people the congress wants to force to have medical insurance? Is it really just the people who aren't on Medicare? So let's go check the house and Senate bills. Opps can't do that because they are not made public! Sorry!

Posted by: lee at February 7, 2010 5:23 PM

Lee,

I'm as skeptical as you are about the 871 billion question mark buried in Congress. Regardless of what Congress wants, I don't think it's unfair to require the young and healthy to make minimum contributions to catastrophic care. They shouldn't be allowed to free-ride off the system like that. Besides, it would go a long way to bring down the cost of health care.

Posted by: MVH at February 8, 2010 7:00 AM

Lee,

I'm as skeptical as you are about the 871 billion question mark buried in Congress. Regardless of what Congress wants, I don't think it's unfair to require the young and healthy to make minimum contributions to catastrophic care. They shouldn't be allowed to free-ride off the system like that. Besides, it would go a long way to bring down the cost of health care.

Posted by: MVH at February 8, 2010 7:02 AM

MVH,

I guess we will have to disagree on the "make".

As for it bringing down the cost of health care, I don't think so. Recall all the nice investigation you did a while back as to why the cost of health care/insurance is so high. It was not because of paying for free loaders. It was the cost of the new technology that has kept so much of us alive.

Posted by: Lee at February 8, 2010 7:44 AM

Don't get me wrong, I'm not saying that freeloading by the young is causing the increase in cost. I still maintain it is technology and innovation. The trick is to find a way to reduce premiums without killing the innovation, and that's what I think requiring catastrophic insurance does. It gives insurance companies a much larger stream of premium payments - from young, healthy people - that would allow the insurance companies to reduce premiums across the board.

I'm simply saying that it's not unfair to require people to pay for such insurance because in the event that they get seriously injured, they currently get that care free.

And yes, we probably agree to disagree on the "making" part.

Posted by: MVH at February 8, 2010 9:21 AM

MVH,

Where exactly do you get off accusing "the young" of free loading in the current system? You provide no evidence in this thread as far as I can tell, and frankly, it's a little offensive. Besides that, if there are some who are free loading, I wouldn't fix that by placing requirements on everyone. Try to be a little more imaginative and get at the actual problem.

Posted by: DKH at February 9, 2010 11:08 AM

DKH,

You are miscronstruing my argument. Read my response to Lee, which is directly above your post.

Also, to clarify - the term I used is "free riding," which does not have the same perjorative connotation as free loading. I'm not even suggesting that the young are AWARE that they are free riders, but that does not change the fact that they are.

Posted by: MVH at February 9, 2010 11:36 AM

Ok, so we can call it "free riding," but I'm still not seeing the evidence for it.

Second, insurance works by pooling similar, but independent, risks. So if young people were purchasing insurance, their risks would be pooled with each other to calculate rates. A 22-year-old just out of college is not going to be pooled with a 55-year-old, even if both are healthy. The 55-year-old is going to see negligible cost reduction, if at all.

Now, if you are correct that young people are somehow a net cost on the system, then sure, that group getting insurance and pooling their risk will save everyone else money. But where is the evidence?

Posted by: DKH at February 9, 2010 2:36 PM

"Ok, so we can call it "free riding," but I'm still not seeing the evidence for it."

Hospitals are obligated to treat catastrophic injuries regardless of their patient's ability to pay. The risk of anyone having a catastrophic injury is not zero. The cost of providing that care is well beyond the means of most who are uninsured.

Unless you dispute any of the above statements, there is no need for further evidence. The uninsured, by virtue of the above logic, are insured against catastrophic care, but they don't pay any premiums.


"Now, if you are correct that young people are somehow a net cost on the system, then sure, that group getting insurance and pooling their risk will save everyone else money. But where is the evidence"

The argument works for all the current uninsureds, young and old. The only reason I mentioned young people in particular is because that group is often mentioned as the group that has many uninsureds and can least afford it. But it works for all pool groups. If you require the uninsured, regardless of their age, to kick in for catastrophic care, then the premiums for all pool groups will go down, and it will be more affordable. That is the argument. It's not that controversial, and I'm hardly the first one to make it.

I am categorically NOT arguing that those who receive catastrophic care without paying are the cause of high health care costs. I am arguing that requiring them to pay for the *risk* of receiving a catastrophic injury -will- reduce premiums. The difference between last two sentences is critical.

Posted by: MVH at February 10, 2010 7:18 AM
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