Obamacare replacement gets lukewarm reception

on March 8 | in z300 | by | with No Comments

After seven years of passing legislation that repealed ObamaCare in total or in part (including a full repeal last year that passed the House and the Senate, only to be vetoed by Obama), on Monday the Republicans released the broad framework of an ObamaCare repeal-and-replace bill.

The result has been, shall we say…underwhelming, as evidenced by the hostile reception it has received by the House Freedom Caucus and conservative advocacy groups.

For years the Republicans have railed against ObamaCare and its pro-socialized medicine, anti-free market provisions, promising to replace ObamaCare at the first opportunity with a patient-centered bill that would take advantage of free market dynamics to lower costs and expand choice.

That is not what this bill does.

To be sure, there are some good provisions of the GOP bill. As outlined in an Investor’s Business daily editorial, the GOP plan “repeals ObamaCare’s multitude of largely hidden but no less destructive taxes on health insurance plans, medical devices, flexible spending accounts and so on. It gets rid of ObamaCare’s individual mandate and the job-killing employer mandate.

It expands the amount of money that can be contributed to Health Savings Accounts, the one health reform that has actually worked to lower costs. It’s age-based, refundable tax credit for individual insurance is an improvement over ObamaCare’s unpredictable, Rube Goldberg subsidy scheme.”

The problem, as IBD points out, is that it also “preserves the beating heart of ObamaCare — the “guaranteed issue” mandate. Under ObamaCare, insurance companies can’t deny coverage in the individual market to anyone who is sick, or charge them more. Premiums can only vary based on age.”

To be fair, we must acknowledge that as a practical matter, ObamaCare can’t be repealed and replaced in a single act. Certain provisions can be repealed through the procedure called reconciliation, which prevents a filibuster and requires only a simple majority to pass, but only provisions related to budgetary matters can be included in a bill under reconciliation. That means ObamaCare is like legislative kudzu; you can chop off the vine that is visible above-ground, but in order to truly eradicate it you have to dig up the roots, which have grown far and wide below the surface.

So while we should not be overly concerned that it may take some time to eradicate every vestige of ObamaCare, we should be very concerned over whether the Republican Congress has the political willpower to do what needs to be done in the face of a Democrat Party and a liberal media that will flood the airwaves with sob stories of every American who benefited from ObamaCare and opposes its repeal. Republicans need to be bold in their defense of free market reforms, and they need to trot out, one after another after another, people who were hurt by ObamaCare but who will benefit from a true free market health care system.

Upon announcement of the bill, President Trump tweeted, “Our wonderful new Healthcare Bill is now out for review and negotiation. ObamaCare is a complete and total disaster — is imploding fast!”

The most important phrase in that tweet is “out for review and negotiation”. This framework can’t be the final product. It is essentially ObamaCare Lite. As Philip Klein at the Washington Examiner pointed out, this bill, if kept in its current form, would be a signal that liberalism has “won the central philosophical argument, and Republicans are reduced to fighting over the mechanics”, noting that “it is not a free market plan. It still rests on the premise that the federal government should play a significant role in subsidizing and regulating insurance markets in an attempt to ensure broad coverage.”

The fact is that there are roughly eleven million Americans who have come to depend on ObamaCare, and it would be cruel to take away ObamaCare and throw them into the proverbial street. A transition period and temporary subsidies will be needed to make sure that they don’t fall through the cracks.

At the same time, the Republicans must be relentless in their pursuit of a free market system that uses market dynamics to reduce costs and expand access. You can’t get there by having the federal government being the biggest spender in the health care space, nor can you get there by continuing a policy that allows people to go without insurance until they get sick before buying a policy without penalty (ObamaCare) or a small, one-time penalty (GOP-care). At some point we have to tell Americans that they are responsible for their own health and health care, and the federal nanny state will no longer save them if they act irresponsibly.

Republicans have a rare opportunity. ObamaCare was passed exclusively by Democrats on a party-line vote, and it has been an unmitigated disaster by any and every measure. Republicans were able to use its failure as a sledge hammer to bludgeon Democrats in the mid-terms, making historic gains in 2010 and 2014. But if, after seven years of promising to repeal and replace ObamaCare, they replace the carpet and the drapes, slap a new coat of paint on it, while leaving the crumbling, dilapidated structure in place, then they will own it, and the American people will not forgive them.

One of the strategic errors that conservative Republicans consistently fall into is that we eat our own with an all-or-nothing approach where we usually end up with nothing. Or, as Congressman Barry Loudermilk (R-GA) has put it to me on more than one occasion, “We throw three Hail Marys and punt”.

Conservatives will have to be patient and realize that repealing and replacing ObamaCare will not be a quick process, and that we can’t eat our own as we go down this road. At the same time, elected Republicans need to understand that the American people have given the more elected seats at all levels of government than they’ve had in nearly a century, and that we expect to be rewarded with bold colors, no pale pastels. ObamaCare Lite is not bold.


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