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“Skeletal Descriptions Of Planlike Concepts”: How The Presidential Race Is Making The GOP’s Health Care Ideas Even Worse

Every major national Republican is sure that they want to repeal the Affordable Care Act. They are much less clear about what, if anything, they would do after stripping insurance from millions of people. Two plausible Republican nominees for president — Scott Walker and Marco Rubio — issued health care plans this week. And…let’s just say there’s a reason Republicans spend a lot more time on the “repeal” part of the “repeal and replace” equation.

Indeed, to call these positions “plans,” as opposed to gestures in the direction of having a policy alternative, is probably too generous. As Jon Chait of New York puts it, they are “not so much plans as skeletal descriptions of planlike concepts.” Still, even in larval form, Walker’s plan contains several elements that are common to most Republican health care proposals, and that if enacted would result in horribly unpopular policy disasters. Here are the main features:

End the individual mandate

Most individual components of the Affordable Care Act are popular; the requirement that people carry insurance or pay a tax penalty is not. And since the mandate was very nearly the lever that gave a conservative Supreme Court majority a pretext to declare the ACA unconstitutional, Republicans have also convinced themselves that it is one of the greatest threats to liberty ever seen. So it is inevitable that any Republican proposal will advocate eliminating it, as Walker’s does.

The problem is that the popular parts of the ACA can’t be divorced from the mandate. If people are permitted to free-ride, the health insurance market can’t work. Multiple states tried to initiate ACA-like reforms without a mandate, and it was a disaster — young and healthy people decline to buy insurance knowing they can get it if they fall sick, premiums increase, more people drop out, and the market collapses. This is why President Obama — who pandered during the 2008 primaries by putting forward a plan without a mandate — recanted as soon as he was in a position to actually try to get a law passed.

Make state regulations ineffective

Whenever conservatives have a policy they would prefer not to defend on the merits, the language of federalism comes in handy. In health care, virtually all Republican plans argue for permitting the purchase of insurance across state lines. Walker’s is no exception: “My plan would allow individuals to shop in any state to find health insurance that covers the services they need at a price that fits the family budget.”

In the abstract, a policy of permitting people to shop for insurance across state lines sounds attractive. In practice, it would be a regulatory race to the bottom. Insurance companies would gravitate to the states that place the fewest regulations on insurance industries. It would therefore become easier for insurance companies to deny claims, rescind insurance (or refuse to give it in the first place), and impose hidden costs. If you think credit card companies should be a model for health insurance companies, then Walker’s plan might sound like a good idea. If you’re thinking more clearly, it’s obviously a terrible one.

Make it easier to sell junk insurance

Walker’s plan would reduce federal regulations as well. The Affordable Care Act’s requirement that insurance actually cover things would be eliminated, as would other provisions such as the popular requirement that children be allowed to stay on their parents’ plan until age 26. Other provisions of the ACA, like the ban on discrimination based on pre-existing conditions, would be seriously weakened. So at the same time as Walker’s plan would effectively eliminate many state regulations, it would also leave the insurance companies mostly unsupervised by federal regulations as well.

Conservatives would defend this awful idea by posing a choice between “regulation” and “competition.” But the problem is that health care simply lacks the features of a competitive market. There’s a reason why other liberal democracies have more state intervention into health care than the United States, not less. And by the way, they all cover more people for significantly less money.

Attack the poor

Walker’s politics are not about small government. After all, he thinks that abortion should be illegal even when necessary to save a woman’s life, and he just approved a $250 million gift of taxpayer money to hedge fund billionaires to build a basketball stadium. Rather, his politics are about assisting the rich and powerful at the expense of the poorer and less powerful.

His health care plan is no exception. Like the ACA, Walker’s plan would offer tax credits to allow people to purchase insurance. But Walker’s tax credits would be distributed on the basis of age, not income. The result, as Jeffrey Young and Jon Cohn demonstrate, would be a disaster for the non-affluent, as insurance would become unaffordable for many people at any age. And in addition, Walker also advocates savage cuts to Medicaid. The callousness Walker showed in refusing the ACA’s Medicaid expansion in Wisconsin is reflected in his health care plans.

So Walker’s plan would be an utter disaster if implemented. But it’s not just about Walker. Amazingly, some conservative candidates and pundits attacked Walker’s plan from the right. A spokesman for also-ran candidate Bobby Jindal accused Walker of collaborating with Bernie Sanders to create a plan that would make health care far less accessible to the non-rich.

Essentially, Republicans look at the state of health care circa 2009 — in which more than 16 percent of Americans were uninsured, and in which insurance companies could abuse consumers in a number of ways — and argue that even fewer Americans should have insurance and the quality of the insurance should be much worse. This is one of the many reasons that the contemporary Republican Party is simply unfit to govern at the national level.

 

By: Scott Lemieux, The Week, August 21, 2015

August 23, 2015 Posted by | Affordable Care Act, GOP Presidential Candidates, Health Reform | , , , , , , , , | 2 Comments

“A Vague Hand-Waving Promise Is Not A Plan”: The Republican Plans To Replace Obamacare Have Been Tried, And They Failed

Before Obamacare, the individual insurance market for people who could not get health care through their job was a nightmare. The only way for insurers to make money was to avoid getting stuck with customers who would rack up high medical bills, forcing them to expend enormous time and expense to screen potential customers for preexisting conditions. Even people who could find plans with affordable premiums had to sign contracts loaded with fine-print exclusions leaving them responsible for unexpected costs. Obamacare overhauled that market, eliminating insurers’ ability to screen out healthy customers. In the new, regulated individual markets, people buy plans regardless of their prior health status. This has been a godsend to those unable to obtain coverage before.

Republicans would repeal all these new protections. But never fear, conservatives insist. In their place will be new protections. Ramesh Ponnuru, writing in National Review, points to two protections put in place by Scott Walker’s proposal, which is the prototypical Republican “see, we do too have a plan to replace Obamacare” plan.

Ponnuru mentions two protections. The first is a provision that would “bar insurers from charging higher prices to sicker customers provided they had maintained continuous coverage.” Republicans have taken to using this line a lot, because it sounds to the average person tuning in a lot like a promise to protect people with preexisting conditions, but the last six words are crucial. Maintaining continuous coverage is really hard. We know this because Congress passed a law in 1996 letting people who have employer-provided insurance keep their plan if they maintain continuous coverage. It has proven nearly useless. Maintaining continuous coverage is really hard for people who have financial distress, and it’s harder if the insurance company has every incentive for you to miss a payment or fail to dot one of your i’s or cross one of your t’s, so they can kick you out. And, of course, in a market where insurers can charge higher prices to sicker customers, “maintaining continuous coverage” means buying insurance that’s really expensive and can deny you coverage for lots of treatments you need.

The second provision is high-risk pools. This is a special market for the customers with the most expensive medical needs. Many states have tried high-risk pools. They also work really, really badly. There are all sorts of practical barriers that make it hard to operate a special insurance system for people with the most expensive conditions. For instance, how do you determine eligibility? Tens of millions of Americans have something in their medical history that makes them a less than perfect risk, from the insurance company’s standpoint. Where do you draw the cutoff for eligibility? And how do you keep insurance companies from skimming the high-risk pools, too — after all, they’ll want to cover the least costly people in the high-risk pool, not the most costly ones.

Even if it is possible to devise solutions to these problems, the biggest single impediment is that high-risk pools cost money. There’s no magic secret in a high-risk pool that makes insurers able to sell affordable insurance to people who need lots of medical care. And where would Republicans get the money to finance the high-risk pools? They don’t say. And they all have signed the Grover Norquist pledge that they will never raise taxes under any circumstances — even if aliens come to Earth and threaten to destroy humanity unless the president agrees to raise taxes by a single penny.

The funding problem is not ancillary. There’s an old joke in which a chemist, a physicist, and an economist are trapped on a desert island, and some cans of food wash up onshore. The physicist devises a plan to smash open the cans. The chemist comes up with a plan to heat them open. And the economist says “assume a can opener.” This is the problem not just with the high-risk pools, but the Republican health-care plans as a whole. They assume the availability of funding, but the party is theologically opposed to raising revenue of any kind. Like having a can opener, if the Republicans were able to overcome their fanatical opposition to revenue, the problem wouldn’t exist in the first place. Any reform that assumes Republicans will find a way to fund it is assuming a can opener. It’s premised on a fantastical assumption. That is why, in the absence of some concrete way around the no-taxes-ever problem, a vague hand-waving promise can’t be called a real plan.

Before Obamacare took effect, different measures were tried to reform America’s cruel and dysfunctional individual health-care marketplace. The continuous-coverage protection and high-risk pools both failed. One thing that succeeded was tried in Massachusetts, by Mitt Romney. The Obama administration decided to build that model out nationally, and it has worked very well — premiums have actually come in well under projections. But since it was Obama’s plan, Republicans oppose it. But since Obamacare is working, they need to have something they can say they’ll replace it with, and they’ve turned to the things that have already failed.

 

By: Jonathan Chait, Daily Intelligencer, New York Magazine, August 21, 2015

August 22, 2015 Posted by | Affordable Care Act, Health Care, Republicans | , , , , , , , | 1 Comment

“The Equivalent Of Thinking The Iraq War Would Be A Cakewalk”: Why The GOP Presidential Candidates Can’t Reform Health Care

In the last few days, Scott Walker and Marco Rubio released health care plans, and other Republican candidates are sure to follow soon. Most will probably be pretty similar, even if some are more fully fleshed out than others.

But they’ll all share one feature, the thing that tells you that they aren’t even remotely serious about this issue: they will take as their starting point that the entire Affordable Care Act should be repealed.

I say that that shows they aren’t serious not because I think the ACA has done a great deal of good, though I do think that. I say it because it shows that they’re completely unwilling to grapple with both the health care system as it exists today, and how incredibly disruptive the wholesale changes they’re proposing would be. Walker’s plan even says, “unlike the disruption caused by ObamaCare, my plan would allow for a smooth, easy transition into a better health care system.” This is the health care equivalent of thinking the Iraq War would be a cakewalk.

The reality is that repealing the ACA now that it has been implemented would mean a complete and utter transformation of American health care. Republicans have often lamented that the law was so terribly long and included many different rules and regulations — yet now they act as though the law amounts to just a couple of rules here and there that can therefore be tossed out without too much trouble. But they were right the first time: the law is indeed complex, and has brought hundreds of changes big and small to American health care, not just in how people get insurance but in how Medicare and Medicaid work, how doctors and hospitals are paid, and in all sorts of other areas.

The ACA established health care exchanges. It brought millions of people into Medicaid, it closed the Medicare prescription drug “doughnut hole.” It gave subsidies to small businesses. It funded pilot projects to explore new means of providing and paying for care, it imposed new regulations on insurance companies. It created new wellness and preventive care programs, it provided new funding for community health centers. It did all that, and much more. You can argue that each one of these was a good or a bad idea, but you can’t pretend that unwinding them all would be anything resembling a “smooth, easy transition.”

We know why every Republican health care plan has to start with repealing the ACA: politics. Republicans have spent the last five years telling their constituents that they’re going to repeal it any day now, and they’ve held over 50 repeal votes in Congress. They’ve refused to admit that a word of it has any merit, even as they try to incorporate some of its more popular reforms (like protections for people with pre-existing conditions) into their own plans. So they’ve backed themselves into a corner where whatever any Republican offers has to start with repeal.

Which is why all their plans, the ones that have been released and the ones yet to come, are absurdly unrealistic. They pretend that it will be no problem to completely transform the American health care system — and there will be no losers in such a transformation, only winners — which shows that they have no intention of actually doing so. In fact, I’d go so far as to say that if a Republican gets elected next November, he’ll be relieved when his health care plan dies in Congress.

Let’s contrast that with how Democrats acted in 2008, when there was a vigorous debate in the presidential primary over health care. The three leading candidates, Barack Obama, Hillary Clinton, and John Edwards, all had very similar plans, similar because they reflected the Democratic consensus on health care reform that had evolved in the decade and a half since Bill Clinton’s reform effort failed. One major disagreement was over whether there had to be an individual mandate — Clinton’s plan had one, and Obama’s didn’t — but when he took office, Obama accepted that the mandate was necessary to make the entire plan work. It wasn’t a fantasy plan that just pandered to liberal hopes, it was something that could actually pass and be implemented.

Whenever liberals told Obama that a single-payer health plan would be far superior to what he was proposing, he would respond that if we were starting from scratch, that would probably be true. But, he’d say, we aren’t starting from scratch, so the ACA has to accommodate itself to the health care system that already exists. The result was a gigantic kludge, new complexity layered on top of an already complex system in an attempt to solve its varied shortcomings. Like all kludges, it seemed like the realistic option given the situation we confronted, but it left us with something that was far from perfect.

A Republican who actually wanted to pass real health care reform would have to approach the problem the same way: by saying that for better or worse, the Affordable Care Act has already affected the system in profound ways, so any realistic plan has to understand what those changes are, and find the most efficient way to keep the ones that are working and change the ones that aren’t. That doesn’t mean that repeal is impossible, just that it would be a spectacular upheaval, one that I promise you Republicans have no genuine appetite for. Remember all the screaming and shouting they did over the people on the individual market whose previous plans didn’t qualify under the new regulations, and who had to shop for new plans? Multiply that by ten or twenty times, because that’s how many people would likely lose their existing coverage if you repealed the ACA in one fell swoop.

And that would be only the beginning. So when any Republican candidate says he or she has a plan to reform health care, take a close look. If it starts with repealing the ACA — and it will — then you’ll know it isn’t serious and it’s never going to happen.

 

By: Paul Waldman, Senior Writer, The American Prospect; Contributor, The PlumLine, The Washington Post, August 20, 2015

August 21, 2015 Posted by | GOP Presidential Candidates, Health Reform, Obamacare, Republicans | , , , , , , | 1 Comment

“They Show That They Still Have No Answer”: Scott Walker, Marco Rubio Propose ‘Plans’ To Replace Obamacare

Today, Scott Walker and Marco Rubio have published plans — really, not so much plans as skeletal descriptions of planlike concepts — to replace Obamacare. Their fundamental dilemma is that Obamacare provides a popular benefit to millions of voters. Appealing to the conservative base demands they eliminate the program that provides this benefit. Appealing to the general election requires them to promise something to compensate the victims of repeal. How will they fund that something? This is the basic problem that for decades has prevented Republicans from offering a health-care plan. Rubio and Walker show that they still have no answer.

The usual pattern in politics is for politicians to turn complex problems into simple ones. But covering the uninsured is a simple problem they want to make complex. The main reason people lacked insurance before Obamacare is that they did not have enough money to afford it. Some of those uninsured people had unusually high health costs. Some of them had unusually low incomes. Boiled down, Obamacare transferred resources from people who are rich and healthy to people who are poor and sick, so the poor and sick people can afford insurance.

It cuts funds, but not benefits, from Medicare. And it transfers resources to sick people through regulations. The individual insurance market is reorganized so that insurers can’t deny essential health services or jack up prices to people with preexisting conditions. This means people with expensive medical needs pay less, and people with cheap medical needs have to pay more. Repealing Obamacare means eliminating all these forms of redistribution from the rich and healthy to the poor and sick. And replacing them with … what?

Walker and Rubio are fairly clear about their plans for regulating the insurance market. They want to go back to the pre-Obamacare, deregulated system. They’d eliminate the requirements that insurance plans cover essential benefits, and let them charge higher prices to sicker customers. That’s good for people who have very limited medical needs (as long as they never obtain a serious medical condition, or have a family with somebody with a serious medical condition). It’s bad for people who have, or ever will have, higher medical needs.

Both Walker and Rubio promise to take care of people with preexisting conditions by creating separate “high-risk pools.” That is a special kind of insurance market for people with expensive medical conditions. As you may have guessed, insurance for people with expensive medical needs is, well, expensive. Making that insurance affordable therefore requires lots of subsidies from the government. Where would Walker and Rubio get the money for that? They don’t say.

Both the Rubio and Walker planlike concepts share a basic structure and an extreme lack of detail. Walker’s document is a few pages padded out with ample white space. Rubio’s op-ed, which repeats the talking points of another op-ed from a few months ago, contains even less information. And the lack of detail is not a matter of filling in the fine print. Both Walker and Rubio have signed the Grover Norquist pledge to never raise a single penny of tax revenue ever, under any circumstances.

Both Walker and Rubio propose to cut funding for Medicaid, but this doesn’t create much room to subsidize coverage, since Medicaid is already much cheaper than Medicare or private insurance. Indeed, the main conservative complaint about Medicaid is that it is so cheap that many doctors refuse to see its patients. Republicans are willing to cut Medicaid because they’re generally willing to cut programs that focus on the very poor, but there’s not much blood to be drawn from this stone.

It is tempting to treat the lack of specifics in the Republican health-care plans as a problem of details to be filled in. But it is not a side problem. It is the entire problem. They will not finance real insurance for the people who have gotten it under Obamacare, nor will they face up to the actual costs they’re willing to impose on people. The party is doctrinally opposed to every available method to make insurance available to people who can’t afford it. They have spent six years promising to come up with an alternative plan, and they haven’t done it, because they can’t.

 

By: Jonathan Chait, Daily Intelligencer, New York Magazine, August 18, 2015

August 21, 2015 Posted by | Affordable Care Act, Health Care, Marco Rubio, Scott Walker | , , , , , , , | 1 Comment

“The GOP’s Obamacare Alternative; Crickets”: Now Railing Against Obamacare Without Having To Come Up With A Replacement

Now that the Supreme Court has saved the Affordable Care Act for a second time, what do Republicans do? We already know they won’t tone down their rhetoric and will continue to call for repeal because that’s what Republican primary voters want to hear. The candidates will package together vague alternative proposals that they will pledge to pass and enact as the first act of their presidency.

But they don’t have even a remote chance of repealing the ACA, even if a Republican is elected president in 2016.

“The ruling is the last gasp,” says Chris Jennings, a health policy expert who worked in both the Clinton and Carter administrations. While the presidential contenders will keep alive the hope for their base that if elected they can sweep away Obamacare, Jennings says the issue will be dead and gone by fall 2016. The voters will have moved on.

Conservatives feel betrayed yet again by Chief Justice John Roberts joining with the liberals on the Court to uphold the constitutionality of the ACA, but they should thank Roberts. He saved the GOP from having to bail out 6½ million people, the majority of them in red states, who would have lost their health insurance if the Court had ruled the other way.

Now Republicans can continue to rail against Obamacare without the responsibility of actually coming up with a law to replace it. “This decision gives them a vast canvas on which to write,” says Jack Pitney, a government professor at Claremont McKenna College in California. “There’s no need for immediate replacement, so rhetoric will fill the vacuum of legislation.”

There will be proposals, enough to satisfy the GOP faithful that the presidential candidates are doing something to end the abomination of Obamacare. But these will not be serious efforts because it is not possible to write health-care legislation that leaves in all the goodies everybody supports, like no discrimination for preexisting conditions, and leaves out what people oppose, like the mandate.

A reading of the majority opinion written by Roberts reveals that he paid close attention to the argument put forth by the health insurance industry in an amicus brief. Without the subsidies, millions could not afford coverage and only those with significant medical expenses would apply, sending the ACA into a “death spiral.”

The Roberts Court handed another lifeline to President Obama, but the decision is also a huge victory for the health industry. Asked how difficult it is for the GOP to step in with their own plan to counter Obamacare, Ceci Connolly, a Health Research Institute Leader and a former Washington Post reporter covering politics and health care, countered with some hard numbers. “The 2.9 trillion dollar health sector is exceedingly complex and changing; it takes an enormous amount of time and work,” she said. “Not only has the ACA expanded coverage, it has pumped billions of dollars in revenue to the health industry, and going back would upset a very large and important market.”

If the subsidies were removed or denied, it would have cost the health industry $36 billion in premium revenue next year alone, Connolly told The Daily Beast. Hospitals would have seen their revenue fall about $9 billion. While still a fraction in a huge market, “that’s real money to the industry,” she says. “The legislative process is cumbersome to say the least, and it would be a steep climb to replace the ACA.”

If a Republican president is elected, and the GOP retains the Senate along with the House, “that’s a new ballgame,” Connolly said. “But by 2017 the law would have been implemented for seven years. It’s very hard to take away benefits and significantly restructure a market as big as the health care market.”

Connolly noted that the executives her research group talks to around the country anticipated the decision to come down the way it did. “They could not imagine the subsidies being taken away.”

The phrase that political scientists use is “past dependency.” Once a major policy is entrenched, it’s very difficult to change in a major way. We’ve seen that with social security and Medicare, programs that President Obama invoked in his remarks in the Rose Garden about the ACA’s rite of passage into “the fabric of America.”

 

By: Eleanor Clift, The Daily Beast, June 25, 2015

June 29, 2015 Posted by | Affordable Care Act, GOP, SCOTUS | , , , , , , , | 1 Comment

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