23 March 2010

The Conservative Health Care Reform Bill

I'm not sure I can add to what Chait wrote, so just go read it.

Key points:

The lack of Republican support for HCR is by many taken as proof that ObamaCare is somehow radical and partisan.  While the vote was partisan, this has more to do with the political calculations of the congressional GOP than about the actual bill. 

Key graf:
Obama's plan closely mirrors three proposals that have attracted the support of Republicans who reside within their party's mainstream: The first is the 1993 Senate Republican health plan, which is compared with Obama's plan here, with the similarity endorsed by former Republican Senator Dave Durenberger here. The second is the Bipartisan Policy Center plan, endorsed by Bob Dole, Howard baker, George Mitchell and Tom Daschle, which is compared to Obama's plan here. And the third, of course, is Mitt Romney's Massachusetts plan, which was crafted by the same economist who helped create Obama's plan, and which is rhetorically indistinguishable from Obama's.

Interesting nugget -- according to Hugh Hewitt's book praising RomneyCare, the idea of the individual mandate was first devised by .... the conservative Heritage Foundation!  I don't endorse this as true, since I don't know, but it's interesting to see the right oppose policies they endorsed when they were not proposed by Democrats.  (The conservatives now claim that the individual mandate is unconstitutional.)

It's also interesting to see criticism of the excise tax on high-cost employer-sponsored insurance plans, when John McCain ran for president on a pledge to tax all insurance plans.  From a policy perspective, though McCain's plan was more sweeping, both have the same effect of creating consumer incentive to reduce the growth in healthcare insurance costs. Which is a conservative policy concept.

Again, I hate to sound like a broken record, but this bill, while a political victory and a step forward for America, is very much a policy victory for the conservative movement.  There is no public option. There are no paths to single payer here. It's not truly universal.  The employer-based healthcare financing and the privately delivered healthcare system are left intact. Whether this reflects the shitty tactical positioning of progressives, the heterogenity of the democratic party, or the degree to which fanatic republicans have shifted the frame to the right remains for philosophers to debate. 

That this bill is excoriated by the right as the death of freedom says more about their radicalism than it does about this bill.


  1. On the contrary: by preventing insurers from charging different amounts to patients with different medical costs, the bill mandates adverse selection whereby only sick people get insurance, which raises the price and drives healthy people out of insurance. This may represent a backdoor to a public option or even more sweeping reform. See here: http://herebetigers.wordpress.com/2010/03/23/healthcare-bill-mandates-adverse-selection/

  2. I actually agree with you -- the individual mandate (and also the employer mandate) are too weak. When fully implemented -- they are phased in -- they will be better, but there will still be some people who will choose to pay the penalty rather than purchase insurance.

    Not too many -- would you rather pay a $2000 penalty and get nothing or a $5000 premium and get bronze-level coverage? So there is *some* incentive, but I agree that it's not strong enough.

    Hopefully it won't cause an adverse selection death spiral, but it is a very legitimate concern.

  3. While it seems that the individual mandate is too weak, Massachusetts has a similar mandate and only 1% choose to pay the fee. Most get the insurance. And insurance premiums dropped 40% as a result of the new influx of healthy young people into the system. Personally, I think we need stronger policy to get more primary care physicians into the system to care for these new patients. Massachusetts has shown that insuring so many people so quickly leads to PMC doctor shortages and increased use of the ER. Also, I heard rhetoric from obama about reforming Medicaid to make it useful for the millions more americans who will be receiving it. I haven't heard anything to address that though. It was not in this bill. Hopefully it will be reformed prior to this bill's full enactment.

  4. Dr B -- There are important Medicaid reforms in the bill. I blogged about them at length here. Could be better but still good.

  5. Thanks for your blog link. Good summary. I saw that they increased the medicaid payments, but didn't realize that they made steps to federalize it. Good that they did that, but unfortunately, many docs don't take medicare patients because of low reimbursement issues, so increasing it to medicare levels helps to a degree but won't fix the fact that medicaid (and medicare) is still a money-losing patient for doctors. Baby steps...I wish the bill were better, but I am glad something is finally getting done. BTW, I owe you a drink - no public option in bill...

  6. Dr. Brenner, Mass insurance premiums dropped 40%?

    I think your data is wrong.

    WSJ article here notes Mass premiums are $13788, the highest in the country. Are you asserting that they used to be 40% higher, and thus almost 2X that if NJ and NY??

    Please cite your source.


  7. i have seen this elsewhere, but this link gives sourcing information: http://voices.washingtonpost.com/ezra-klein/2009/11/massachusetts_provides_evidenc.html

  8. The link you cite is a 40% decline in non-group plans only. The non-group folks are generally higher risk, and the group folks are generally lower-risk.

    So, it is correct that the cost of higher-risk plans will drop.

    But it does so by increasing the cost of lower-risk plans.

    No surprise.

    But at the end of the day, the total cost spent on healthcare in Mass is now the highest in the nation and rising faster than the nation's cost as a whole.

    And that makes sense. But it seriously undermines the "reduce costs" mantra. Make no mistake, average costs are going higher and will rise faster than before. We need only look to Mass to know that.

  9. Anon -- you're half right. According to the CBO, the expected participant in a non-group plan is slightly healthier than in the large group market. But you are also right that regulation does add a lot of sicker folks to the non-group market -- but that is the point. Those were in many ways the uninsurable who are being brought into the system.

    MA is difficult to assess in regard to cost, though, since it was among the most expensive states before health reform was there, too.


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