The incredibly weak case for repealing Obamacare

Unified conservative government in Washington has given Republicans an unobstructed path to repeal Obamacare. As Vice President-elect Mike Pence recently assured a group of Heritage Foundation donors at the Trump International Hotel, “We’re going to repeal Obamacare lock, stock and barrel,” calling repeal the incoming administration’s “number one priority.”

But as clear as the repeal path may be, it’s worth pausing to reflect on the actual merits supporting the unrelenting conservative attack on the law. As it turns out, the case against Obamacare is incredibly weak.

First and foremost, more than 20 million people have gained coverage under the law, driving the uninsured rate to historic lows. These gains would be reversed by repeal. Repeal could cost as many as 30 million people their health insurance, causing the uninsured rate to double. And without Obamacare’s protections, 52 million people with a preexisting condition may struggle to find affordable insurance.

Moreover, many of the controversies that conservatives ginned up while the law was being drafted never came to pass. The public option for health insurance was scrapped before the law was enacted. The Cadillac Tax on high-end health insurance plans has been perpetually delayed. The supposedly job-killing employer mandate took effect this year, yet private sector employment continued to rise, as it has every month since Obamacare became law. The cancellation of low-quality insurance plans, which affected a small fraction of the country in 2013, was a one-time product of the transition to Obamacare. “Death panels” were never a real thing. The real, much more innocuous idea—reimbursing doctors for counseling patients about end-of-life care options—was stripped from Obamacare, and then quietly adopted by regulation last year.

Still, conservatives are nonetheless forging full steam ahead with kneejerk Obamacare repeal. “This law, you have to remember, is hurting families in America,” Speaker Paul Ryan recently said with little regard for the millions of families insured under the law. “So we have to bring Obamacare relief as fast as we possibly can in 2017.”  He and other Republicans now cling to two chief objections to Obamacare: its effect on out-of-pocket payments, and its mandate to carry health insurance. Neither would be improved by repeal.

Republican complaints about premiums under Obamacare are a shameless exercise in bootstrapping. It’s true, premiums on most of Obamacare’s exchanges rose significantly this year. But Republicans themselves triggered part of these premium hikes by repealing Obamacare’s risk protections for insurers last year. Conservatives intentionally wounded the law, and then complained when insurers backed out and premiums rose because of it.

Moreover, premium hikes were surprisingly low over the previous two years, so some of this year’s increase came from insurers returning to expected premium levels. It’s also a product of insufficient competition. More insurers competing for business would produce better bargains for consumers.

There are sensible ways to fix these problems that are far less disruptive to our healthcare system than wholesale repeal. Young, healthy people have sat out of the marketplaces in greater numbers than expected. If more of these customers purchased insurance, more insurers would participate and consumer costs would be lower. To attract more healthy customers, the marketplaces need to offer more appealing coverage options. This could be accomplished by allowing the federal health exchange to actively negotiate better rates with insurers, like California’s exchange already does. The government could also offer more generous cost-sharing subsidies to help with out-of-pocket expenses. And we could allow those nearing retirement age—say, individuals 55 and above—to sign up for Medicare. This would pull some of the oldest and costliest patients out of the individual marketplaces, lowering premiums for everyone else, and making those marketplaces less risky for insurers.

Repeal, on the other hand, would only make matters worse. To the extent Republicans succeed in lowering premiums under an Obamacare replacement, they would likely do so only by weakening the quality of insurance. Young and healthy people may see lower-cost options, but older and sicker people could see substantial premium increases. And costs on the individual market could skyrocket if Republicans try to retain Obamacare’s ban on preexisting condition exclusions without implementing an adequate substitute for the individual mandate.

Which gets to the long-time conservative bogeyman of Obamacare: the individual mandate. The mandate is the lynchpin the holds the law together—you can’t guarantee private coverage to the sick at fair rates without also guaranteeing insurers a broad pool of healthy customers. The mandate offers everyone a choice: you can do your part to secure a more equitable healthcare system by either purchasing insurance or paying a tax.

Even though they invented the individual mandate, conservatives have spent years railing against it as an unconscionable intrusion on individual liberty. But if the mandate impairs freedom at all, it’s the freedom to suffer from health insecurity and vulnerability to illness, tax-free. That’s hardly a freedom worth preserving.

Instead of an individual mandate, most conservative repeal plans adopt a “continuous coverage” requirement. Like the mandate, this would require Americans to continuously carry insurance coverage. But rather than paying a tax to the government, those who go through a spell without insurance would get price-gouged by insurance companies. These individuals would be hit with higher premiums when they reenter the insurance market, and potentially really high premiums if they have a preexisting condition.

It’s hard to say whether this complex penalty will even work, given that the so-called “young invincibles” the individual market desperately needs are prone to lowballing the likelihood of future illness. But the conservative individual mandate replacement is, if anything, a more draconian penalty than Obamacare’s mandate. The conservative plan adds insult to injury for those who fall on hard times: If you lose your insurance, you get penalized with higher future premiums and inadvertently waive your right against discrimination on the basis of illness. What’s worse, the conservative plan makes it harder for those down on their luck to afford coverage in the first place. Because conservatives would abandon income-based subsidies, many people will be caught in an impossible situation: buy insurance you cannot afford now, or get hit with even higher premiums in the future.

Currently, Republicans are trying to devise a “repeal and delay” scheme to avoid upending the individual markets while they work out a replacement bill. But the difficulty of these efforts only underscores the fact that Obamacare is fundamentally a moderate reform. Ironically, repeal would be much easier for Republicans had Obamacare expanded insurance through a single-payer, Medicare-for-All scheme. In that alternative universe, Republicans could simply schedule Medicare-for-All to sunset on, say, December 31, 2018, and the to-be-determined right-wing reform would seamlessly kick in the next day, with minimal turmoil in the interim.

Instead, Obamacare opted for a more cautious approach dependent on the voluntary participation of private insurers. This has made it harder to expand coverage and guarantee insurance offerings across the country. But at the same time, the prospect of a painful zombie transition period on the exchanges also makes the law harder to repeal. Insurers could exit the marketplace in droves after a repeal vote, as if fleeing a sinking ship. This would cause real pain in the lives of the millions of Americans left uninsured, and political pain to the repeal-obsessed GOP.

Conservatives believed their own spin that Obamacare was a big government monstrosity. Now in a role of actual power and responsibility, they are grappling with the inconvenient truth that the law really is a carefully crafted, moderate reform bettering the lives of millions of Americans—all of which makes the unthinking march toward repeal deeply irresponsible.

The path to repeal is wide open for Republicans. And raw power politics means they can pretty much do as they please. But in a democracy, the party in power still owes the country a justification for its policy agenda. And when you really get down into it, the case for Obamacare repeal is spectacularly weak.

Note: This post is cross-posted at Medium.

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