Progressive health reform in 2020

Progressives are readying the next era of health reform. Bernie Sanders has introduced a Medicare-for-all bill, with substantial support among prominent Senate Democrats. Other Democratic proposals include letting people buy into Medicare, or letting them buy into Medicaid, or creating a “Medicare X” plan that would let people buy into a new form of Medicare on Obamacare’s marketplaces. The left-of-center terrain is rife with ideas about what comes next in healthcare.

A new symposium hosted by the American Prospect and the Century Foundation adds to this terrain. All six contributions from healthcare experts are worth reading (1, 2, 3, 4, 5, and 6). I’d like to focus on two of these ideas, and what they mean for how health reform thinking is evolving on the left-of-center.

The first comes from Jacob Hacker, a political scientist at Yale. He is also the godfather of the public option—the Affordable Care Act-era proposal to create a government-run insurance plan to compete with private insurers.

In 2007, Hacker proposed a healthcare plan that paired a mandate on employers to provide insurance with a Medicare-like public plan to cover the uninsured. At the time, Hacker’s plan was out of step with mainstream Democratic priorities on healthcare. As I’ve written, Democrats felt burned about being tagged as overreaching statists during Bill Clinton’s 1993 health reform effort. When Barack Obama made another attempt at health reform, Democrats opted for a centrist approach built around government facilitation of competitive private insurance markets.

Within this framework, Hacker’s proposal was whittled down to a public option that would offer plans within Obamacare’s insurance marketplaces. This was the chief liberal imprint on the Affordable Care Act debate. But the public option ultimately proved too much for the Senate Democrats that held the decisive votes on health reform. Hacker’s public option was unceremoniously excised from the bill.

Obamacare went into effect with no alternative to private insurance for most people. The law has made tremendous gains in getting people covered. But most of these gains have come from the law’s expansion of public insurance under Medicaid. Obamacare’s private insurance marketplaces have been wobbly and in flux, constantly under attack by Republican opponents, and prone to price increases and exits by insurers.

Now Hacker is back with a new contribution to the liberal healthcare brainstorm session. He proposes a plan he has called “Medicare Part E”—Medicare for everyone who wants it. “All Americans should be guaranteed good coverage under Medicare if they don’t receive it from their employer or Medicaid,” Hacker writes.

The key features of Hacker’s plan include:

  • Automatic guaranteed coverage for all Americans under a new Medicare Part E.
  • You can opt out of this default Medicare coverage by enrolling in an employer-sponsored plan or other private insurance plan with benefits at least as good as those offered by Medicare.
  • A “pay or play” requirement on employers, who would be responsible for either providing good health insurance to their workers or contributing toward the cost of Medicare Part E.

Hacker’s plan has a lot going for it. It takes the best part of single-payer—guaranteed coverage—while leaving room for consumer choice. Medicare Part E wouldn’t jeopardize the employer-provided coverage that people have and like (as long as those plans meet quality standards). And the experience of Obamacare shows that employers are unlikely to ditch their insurance offerings in droves to dump workers on to a new public plan.

Medicare Part E builds on the public preference for voluntary, rather than coercive, government healthcare programs. The idea for a voluntary public option has been consistently popular, while Obamacare’s now-stricken individual mandate was consistently not. Rather than banning private insurance (as some single-payer plans would), Hacker would supplement private insurance with a Medicare fallback available to all Americans as a right of citizenship. Like the idea of making Medicare the default coverage for kids (which I’ve written about), those who prefer private coverage could still get it.

The second proposal comes from John Holahan and Linda Blumberg of the Urban Institute’s Health Policy Center. They argue that instead of creating a public option, we should cap the payment rates that hospitals and providers can charge to insurers.

The strongest version of a public option would help control healthcare costs by paying providers the same low rates that Medicare pays. But this public option would draw fierce industry opposition from both insurance companies and providers.

Blumberg and Holahan suggest that we can capture the same cost savings of a public option by simply applying the same payment caps to private insurers. Under their proposal, private insurers would pay providers at rates capped at what Medicare pays (or the Medicare rate plus a percentage more). This would achieve cost savings while defusing potential opposition among insurers.

This plan would essentially import the regulatory structure used in Medicare Advantage into the rest of the health insurance system. Medicare Advantage is the program that allows private insurers to compete with traditional single-payer Medicare. It currently enrolls about one-third of all Medicare beneficiaries. Under Medicare Advantage, out-of-network providers cannot charge private insurers more than Medicare rates, which also implicitly caps the rates paid by in-network providers, too.

Blumberg and Holahan would expand these rules beyond the Medicare Advantage market and into the broader health insurance market. In effect, the insurance industry would become more like a public utility—the broader market would functionally be a public option. “This approach would control costs in areas where premiums are high,” Blumberg and Holahan write, “and it would reduce barriers for insurers in markets where monopoly conditions currently exist.”

It’s not clear that this proposal would lure health insurers off the sidelines to sell in the nearly barren areas underserved by Obamacare’s marketplaces, like rural regions. And it wouldn’t provide an alternative to the administrative complexity of the private insurance system.

But Blumberg and Holahan are right that absurd costs are at the root of much of what ails our healthcare system. Rate-setting and price controls should be in the discussion for the next phase of health reform. Healthcare simply isn’t a market where we can let prices fluctuate with supply and demand. “Consumers” aren’t able to easily shop around or walk away from healthcare services that are just too essential to turn down. This removes the downward price pressure that exists in other true markets for goods and services. Government can step in and restore that price pressure by limiting the prices that doctors and hospitals can charge.

“Medicare-for-all” is a good campaign slogan for progressives to run on. But it’s also a bull-in-a-china-shop approach that would upend the existing system. There are other ideas on the table that more gingerly navigate the political headwinds that Health Reform Phase 2 will inevitably face. Coupling national price controls while making Medicare available to everyone may just be the way forward.

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Last night was about healthcare

The country sent Donald Trump and the Republican Party a clear brush back pitch on November 7, 2017.  Democrats enjoyed their best election night in a half decade, winning high-profile governor’s races in New Jersey and Virginia, and making massive statehouse gains in states across the country.  It was a rout — a veritable “ass-kicking,” in the words of Connecticut senator Chris Murphy.

And the common thread of the night was Americans sticking up for their healthcare.

In Maine, nearly 60 percent of voters approved a referendum to adopt Obamacare’s Medicaid expansion, extending health insurance to 89,000 low-income residents.  The state’s intransigent troglodytic governor Paul LePage had ardently opposed expansion, repeatedly slandering Maine’s would-be Medicaid recipients as lazy leeching “able-bodied adults who can work and contribute to their own health insurance costs.”  The people of Maine just put LePage in his place, going around him to overwhelmingly approve healthcare for their neighbors.

Medicaid’s rousing victory in Maine is expected to inspire similar ballot initiatives in more non-expansion states in 2018.  These could include Utah, Idaho, Kansas, and other states that have held out against expanding Medicaid.

In Virginia, a tight governor’s race turned into an easy win for Democrat Ralph Northam.  This has roundly been read through the lens of Northam’s Republican opponent, supper lobbyist Ed Gillespie, who remade himself in the image of Trump be running on racial fear-mongering in an attempt to gin up the conservative base.  Voters in Virginia roundly rejected Trumpism on Tuesday.

But the results were also driven by voters’ concerns about their healthcare.  Nearly 40 percent of Virginia voters surveyed in exit polls reported that healthcare was their most important issue, far outpacing any other concern.

Democrats also made historic gains in Virginia’s House of Delegates.  As of Wednesday morning, Democrats had picked up an incredible 14 seats in the hundred-seat statehouse, pulling to a 48-47 lead with five races still being tallied or too close to call.

Winning a statehouse majority would extend Medicaid to 400,000 low-income Virginians.  Current Democratic governor Terry McAuliffe tried for years to expand the program, but the Republican-controlled House of Delegates blocked him at every turn.  A Democratic-led statehouse would allow Virginia to finally expand the program.  But even a House of Delegates with a slim Republican majority will feel incredible pressure to expand Medicaid in light of Tuesday’s sweeping election results.

These were state elections, but they were driven by national politics.  Donald Trump and Republicans in Congress relentlessly attacked the health security of millions of Americans for the vast majority of 2017.  Their party paid for it up and down the ballot on Tuesday.  Voters fought back to protect their care.

Before Tuesday, Republicans in Congress were toying with using their tax reform bill to take another stab at secretly gutting Obamacare by repealing the law’s individual mandate.  If Congress balks, Trump is poised to continue his administrative campaign to sabotage the law by readying an executive order unraveling enforcement of the mandate.  Either would strike a massive blow against ensuring affordable healthcare access under Obamacare.

Republicans go after healthcare at their own risk.  Tuesday’s electoral sweep follows on the heels of a surge of early sign-ups on Obamacare’s health exchanges despite Trump’s best attempts to thwart them.  The anti-Trump resistance flexed its muscle last night.  If Republicans train their fire on healthcare yet again, they will only fuel the greater storm gathering for November 2018.

The parable of Donald Trump and the imaginary hospitalized senator

Congressional Republicans failed again to repeal Obamacare last week.  To rationalize yet another swing-and-a-miss, President Trump took a novel approach: he invented a hospitalized senator.  “We have the votes,” Trump falsely claimed to Fox and Friends, but “we don’t have enough time, because we have one senator who’s a ‘yes’ vote, he’s a great person, but he’s in the hospital.”

This appeared to be an odd spin on the plight of Sen. Thad Cochran, who was forced to publicly clarify that he was not actually hospitalized, but was home recuperating from a “urological issue.”  And of course, even with a healthy Cochran, the GOP still lacked 50 votes for its bill, with Sens. John McCain, Rand Paul, and Susan Collins all opposed.

Still, Trump’s fabrication of the hospitalized clinching vote is a fitting coda to the latest GOP healthcare failure.  After all, the entire battle against Obamacare has been founded on fantasy.

It was a fantasy that Obamacare was a tyrannical government takeover of the healthcare sector.  In reality, it was a modest step to patch up the holes in our ragtag mix of public and private coverage, meant to scoop up most of the people who fell through the cracks and were victimized by the old status quo.  Obamacare was such a centrist program that it left the GOP no room to maneuver rightward while still maintaining its popular coverage guarantee for people with pre-existing conditions.

It was a self-delusion that Obamacare was failing or caught in the throes of a death spiral, as Republican leaders like Speaker Paul Ryan like to claim.  Every indicator of insurer profitability showed that Obamacare’s marketplaces became a stable, safe place to sell insurance last year.  And every government study found that the marketplaces were on firm ground for the foreseeable future.  Even Trump’s own Health and Human Services department admitted that the marketplaces were in good shape–but that didn’t stop him from spreading the myth that Obamacare remains on the brink of collapse.

It was masochistic wishful thinking to believe that Obamacare was sowing ruin in the lives of American families.  For millions, the law was quite literally a lifesaver.  For the first time, people with preexisting conditions were guaranteed a right to affordable healthcare.  People who already had insurance could rest easy knowing that a costly illness or injury wouldn’t bankrupt them, thanks to the ban on caps on insurance coverage.  The repeal drive in particular revealed the immense popularity of Obamacare’s Medicaid expansion, and how much people had come to depend upon the law’s protections.

Certainly, Obamacare is not a perfect law.  But it was absurd to think that the GOP’s proposals would do anything to fix its flaws.  Mitch McConnell, Ryan, and other Republican leaders spent years ripping Obamacare for its high premiums and deductibles–and then turned around and embraced a series of bills that would make those problems much, much worse.

The conservative movement’s “alternative facts” problem well predates Trump.  But Trump undoubtedly made the problem worse, normalizing the acceptability of outright lies about policy proposals.  Trump’s shameless disregard for the truth made it okay for other Republicans to insist that their healthcare bills would cover everyone and lower premiums–when time after time, the exact opposite was true.  In the latest Republican run at Obamacare, it’s what made it okay for Bill Cassidy to lie that his bill guaranteed coverage for people with pre-existing conditions, even though it was clear that it left room for states to kick those very people off of their coverage.

It was this unbridgeable chasm between fact and fiction that ultimately doomed the repeal effort.  After being fed fantasies for seven years, average Fox News-ingesting conservatives–like Trump himself–came to believe that Obamacare really was a disaster and that their leaders had actual plans to do better.  But as Barack Obama warned Trump after the election, “Reality has a way of asserting itself.”  And the gap between healthcare reality and fantasy was massive, sucking the GOP’s repeal plans into the vortex in between.

It has long been clear that Republicans would be unable to produce effective healthcare legislation.  And it was predictable that this would all end with the GOP scampering away with a contrived excuse to preserve some dignity to fight another day.  That the best apparent excuse involved a non-decisive senator’s urological outlook speaks volumes about the shattered state of that dignity.

Republicans won’t soon give up the ghost of Obamacare repeal.  Fantasy or not, repeal has been the party’s central policy goal for seven years.  It’s much easier to keep taking potshots at universal healthcare and to fire off Hail Mary repeal bills than it is to rethink what it means to be a conservative in a governing party–particularly with a president void of core principles or long-term policy visions.  Right on cue, congressional Republicans are still leaving the door open to take yet another run at Obamacare in 2018, undeterred by their latest face-plant.

For the better part of a decade, Republicans have committed themselves to a policy mission premised on a series of fantasies. It’s no surprise that they’d conjure one more to excuse their failure—a way to cling to the illusion that they’ll grab the brass ring next time.

So they beat on, boats against the current, forever one healthy urinary tract away from the promised land.

How the Obamacare repeal fight could lead to bigger government

The Republican legislative charge against Obamacare appears to be dead for the time being.  But the GOP’s bedeviling ordeal to roll back the healthcare law may have already backfired. Progressives might come away from this fight seeing virtue in reaching for bigger government solutions for America’s social safety net.

Obamacare’s staying power is Exhibit A of how social insurance programs are inherently sticky.  Political scientist Paul Pierson has observed that conservatives perpetually fall well short of reversing the biggest expansions of the welfare state.  Ronald Reagan largely acquiesced to Medicare and Social Security—even though he had long opposed both programs as menaces to American freedom.  In the United Kingdom, Margaret Thatcher was stymied from unwinding Britain’s national healthcare system.

Pierson theorized that welfare state expansions last because they fundamentally reshape politics by creating strong interest groups of beneficiaries to defend these programs.  “[T]he emergence of powerful groups surrounding social programs may make the welfare state less dependent on the political parties, social movements, and labor organizations that expanded social programs in the first place,” Pierson argued.

That’s why the defense of Obamacare this year proved so potent.  The law’s Medicaid expansion created a new class of beneficiaries to advocate for the program, and who stood to become human carnage under any rollback.  And the law created a constituency of people who counted on government help to get affordable decent coverage, and others who depended on the law’s regulations to protect them from pre-existing conditions exclusions or lifetime caps on benefits.  Quite simply, Obamacare helped a lot of people—many of whom became passionate and highly credible advocates for the law in 2017.

So if Democrats can just heave a new social program over the finish line in Congress, that program can then generate its own defenders even if the political climate in Washington swings to the right.  In 2010, Democrats squeaked Obamacare into law, and then proceeded to lose both houses of Congress and the White House over the ensuing six years.  But by cultivating a new class of Obamacare beneficiaries, the law became remarkably resilient even as Democrats’ hold on power collapsed.

So what type of program should Democrats be trying to muster into law?  One that can withstand permanent conservative opposition.  One thing is clear from the Obamacare experience: Democrats will get no credit or Republican buy-in for adopting a moderate, market-centered approach for social insurance programs.  Obamacare’s health insurance marketplaces were designed as public-private partnerships, where the government relies on private insurers to help expand healthcare access.  Democrats famously poached this idea from former Republican presidential nominee Mitt Romney’s tenure as governor of Massachusetts.  Still, Republicans vehemently turned on their own idea simply because a Democratic president had embraced it.

But a moderate policy design without bipartisan support has turned out to be extremely vulnerable.  While Obamacare stands mostly intact in spite of fervent conservative opposition, the prospect of full or partial repeal of the law perpetually spooks insurance companies.  Insurers hike premiums or leave markets altogether, jeopardizing the ability of whole swaths of the country to meaningfully benefit from national health reform.  And of course, when a hostile administration is charged with running the program, there are countless levers it can pull to deliberately trigger an insurer stampede and to cause the program to fail.  Obamacare’s design leaves it at enormous risk under a saboteur-in-chief.

The solution is to bolster social programs with more robust government-run options.  Skittish Democrats built Obamacare around private insurers in order to avoid being tagged as executing a big government takeover of healthcare—but conservatives called it one anyway.  If Democrats are going to be branded as overreaching socialists either way, then they may as well come away with something stronger to show for it, rather than settling for a rickety structure dependent on the voluntary participation of bottom-line-driven private companies.

To be effective in the long run, most social insurance programs need public options.  For Obamacare, this might mean opening up Medicare, Medicaid, or other public insurance programs to scoop up those who are being underserved by the law’s private insurance expansion.  Or maybe it means transcending Obamacare altogether with a single-payer system.  Either way, buttressing Obamacare requires tilting the law’s center of gravity away from private insurance options and toward public ones.

After all, while the GOP may be licking its wounds for now, don’t count on its anti-Obamacare fever to ever truly break.  A few congressional Republicans may be ready to finally pursue pragmatic tweaks to make Obamacare work better.  But opposition to universal healthcare has been the central tenet of the Republican Party for nearly a decade.  It’s far more convenient for the GOP to continue launching salvo after salvo at the law than it is to rethink what it means to be a conservative.

Republicans were still coming after Social Security seventy years after its enactment, trying and failing to partially privatize the program in 2005.  Paul Ryan still dreams of dismantling Medicare fifty years after LBJ signed it into law—a dream built around the same public-private health insurance partnership that he and his party discredited under Obamacare.

If this history is any guide, there’s little use in hoping for a true truce over the pillars of the welfare state.  Instead, progressives must fortify them to withstand an interminable barrage.

The Senate healthcare bill might be unconstitutional

Senate Republicans just won’t let their healthcare bill die. But if the political process doesn’t kill it, the U.S. Constitution might. That’s because the Senate bill now imposes insurance market death spirals on any state that fails to step in to create its own positive health policy. That very well may be unconstitutional under the Tenth Amendment’s prohibition on coercing the states.

On Friday, the Senate’s Better Care Reconciliation Act (“BCRA”) took a Byrd Bath. That’s the process by which the Senate parliamentarian reviews a reconciliation bill to make sure each provision is related to the federal budget. Provisions that aren’t sufficiently related to spending get eliminated from the bill and cannot be passed by a bare majority reconciliation vote.

Unfortunately for the GOP’s already-floundering healthcare effort, the parliamentarian just knocked out some major provisions of BCRA. She ruled that a provision defunding Planned Parenthood requires sixty votes to succeed. And she ruled that a provision prohibiting federal tax credits from paying for abortion services requires sixty votes as well.

These are deep political blows to Republicans, making “passage almost impossible,” according to Rep. Mark Meadows. But perhaps the most devastating decision by the parliamentarian struck down the GOP’s six-month lockout proposal. This policy was meant to be a conservative replacement for Obamacare’s individual mandate. It would make anyone who failed to maintain continuous insurance coverage wait six months before signing up for insurance. This is meant to stabilize insurance markets by nudging healthy people to sign up or face a six-month penalty.

Without the six-month lockup provision, BCRA suddenly has no mechanism to stabilize insurance markets. This leaves Senate Republicans courting insurance market disaster. The GOP would leave in place Obamacare’s politically popular guaranteed issue and community rating requirements. Guaranteed issue means that insurers cannot deny coverage to people with preexisting conditions. Community rating requires insurers to offer coverage to sick people at the same price they offer to healthy people.

For insurance markets to remain stable under these regulations, they must have a broad risk pool with a substantial number of healthy people enrolled in coverage. That’s why the individual mandate to purchase coverage is so crucial, pulling healthy people into the market. Without any type of penalty for forgoing insurance, anyone can buy insurance at any time. This means that more healthy people will decide not to purchase insurance until they need it. With the healthiest people opting out of the market, costs go up for everyone else, leaving a sicker risk pool left over. The next healthiest group then drops coverage, making costs rise and the risk pool sicker still.

This is what’s known as an insurance market death spiral — a process that culminates in a moribund insurance market with few if any insurers willing to sell. And that’s exactly what would happen under either GOP healthcare bill. For Senate Republicans to press ahead with BCRA in its current form would be to deliberately inflict insurance market death spirals.

At the same time, the GOP bill loosens the requirements for states to obtain waivers from federal regulations. As Nicholas Bagley explained at Vox, “Under the Affordable Care Act, a state has to show that its alternative plan would allow it to cover as many people, with coverage as generous, without increasing federal spending. [. . .] [But] [u]nder the Senate bill, to get a waiver, a state doesn’t have to demonstrate anything about coverage. Instead, it just has to show that the plan won’t ‘increase the federal deficit.’”

This makes it significantly easier for states to obtain waivers from national healthcare rules. Indeed, as long as a state’s proposed plan doesn’t increase federal spending, the federal government is required to grant that state’s waiver request under BCRA.

So post-Byrd Bath, the Senate bill pairs disastrous, death-spiral inducing federal insurance market rules with a much more permissive process for states to obtain waivers from those very rules. From one vantage point, it appears that the Republican Congress could even be threatening a booby-trapped insurance market if states don’t take action to seek waivers to implement their own regulatory policies. That is, the GOP healthcare bill is so bad, it could only reasonably be meant to provoke state-based reform.

That’s where the Senate bill gets into constitutional trouble. The Supreme Court has read the Tenth Amendment to prohibit Congress from enacting legislation that coerces the states. The states are sovereign entities, and Congress cannot try to compel desired action from them through overly strong-arm tactics. For instance, when Obamacare threatened to cut off all pre-existing Medicaid funding from any state that declined to expand its program to cover the near poor, the Supreme Court held that this threat amounted to undue coercion. As Chief Justice John Roberts put it in NFIB v. Sebelius, this threat amounted to Congress pointing a “gun to the head” of the states. No reasonable state would have had any meaningful choice.

One could read BCRA as posing a similar threat to the states: adopt state-based health reform, or have your insurance markets destroyed by malicious federal regulation. Indeed, this promotes the conservative preference for federalism and state-level policymaking. Under BCRA, if state lawmakers want healthy insurance markets, they will need to take affirmative legislative action to enact market-stabilizing policies and to seek federal waivers to take steps to save their insurance markets.

This looks awfully coercive. If states don’t act, BCRA’s perverse regulatory regime destroys their insurance markets. BCRA thus becomes a way to compel state action.

But don’t take my word for it. There’s some indication that the Supreme Court considers the threat of insurance death spirals to be constitutionally problematic. In King v. Burwell, opponents of Obamacare argued that Congress had conditioned subsidies for individual insurance enrollees on each state’s decision to run an insurance marketplace. If so, that meant that Congress had threatened states with insurance market death spirals if they didn’t run their own exchanges: without subsidies, the individual mandate would be inoperative while guaranteed issue and community rating remain in effect (the same dynamic as under BCRA). Such a federal regulatory environment would have plunged insurance markets into death spirals in states that refused to comply with the wishes of Congress.

A coalition of law professors and non-profit organizations presented this problem to the Supreme Court in an amicus brief (on which I advised). And at oral arguments, multiple justices worried about the coercive effects of Congress imposing death spirals on the states. Justice Anthony Kennedy called it “a serious constitutional problem.” “The states are being told: Either create your own exchange, or we’ll send your insurance market into a death spiral,” he said.

Justice Sonia Sotomayor was similarly troubled by the coercive implications of the plaintiffs’ reading of the ACA. “If we read it the way you’re saying,” she said, “then we’re going to read the statute as intruding on the federal-state relationship, because then the states are going to be coerced into establishing their own exchanges.” (In its opinion, the court ultimately steered clear of any constitutional issues by locating an anti-death spiral constraint in the statute itself.)

Granted, these are the oral argument musings of just two of the Court’s nine justices. But one could imagine a state opposed to Obamacare repeal seizing on these hints from King v. Burwell to attack BCRA in court, pressing the Supreme Court to deal with the “serious constitutional problem.” For BCRA presents a unique perversion of the federal-state relationship: federal legislation so awful that it coerces any reasonable state into action.

The Senate’s healthcare bill was bad when it was introduced, and it got made worse after undergoing its Byrd Bath. The GOP’s healthcare effort is no longer just politically dire. It has now ventured into potentially unconstitutional territory. The same is true of the Senate’s alternative “repeal only” bill, which too would eliminate the individual mandate without bothering to supply any replacement.

The Senate is due to vote to begin debate on Obamacare repeal in a matter of hours. After the parliamentarian’s decision, the Senate’s bill currently lacks any meaningful way to protect insurance markets. If Senate Republicans press on with the bill in its current form, they will be assenting to inflicting grave harm on health insurance markets across the country. And they may be casting a bad vote for a bill that’s on the wrong side of the Constitution.

 

Note: This post is cross-posted at Medium.

Medicaid is once again a conservative piñata

Margot Sanger-Katz writes at the New York Times that the Republican healthcare bill is increasingly becoming a rollback of Medicaid:

“[T]he Medicaid caps have not drawn the same public outcry as other provisions of the law that would cut back on coverage more directly. Several Republican senators have expressed concerns about changes to Obamacare’s Medicaid expansion, which broadened the program to include more low-income adults in 31 states. [ ] Others worry about changes to private insurance subsidies that would make insurance less affordable to older, middle-class Americans. Fewer have spoken out about the cuts to Medicaid’s legacy beneficiaries. That means that, as the Senate works out final details, the forced diet for Medicaid is likely to stay in the bill.”

The GOP bill plans draconian cuts to the Medicaid program, both by unwinding Obamacare’s expansion of Medicaid coverage to people earning up to 138 percent of the poverty line, and by capping the amount that the federal government will chip in to cover people on “traditional” Medicaid.  These cuts jeopardize healthcare for people from all walks of life, including middle-class families with children with disabilities, or elderly people in nursing homes.  Nearly one hundred million Americans rely on Medicaid—our country’s largest health insurer.

But in the conservative war against Obamacare, Medicaid has always been a convenient target.  In the first hotly politicized court challenge to Obamacare in 2012, the Supreme Court upheld the law’s individual mandate, but weakened its Medicaid expansion by making it voluntary for the states.  Even liberal justices Stephen Breyer and Elena Kagan joined the Court’s conservatives in striking down the mandatory Medicaid expansion.  This preserved the individual insurance markets for the middle-class, while leaving public insurance coverage for the near-poor at the whims of state governments.

Conservative lawmakers seized on the “Red State Option” opened up by the Court to make their stand against Obamacare.  Nineteen states held out and refused free federal money to cover nearly all of the expansion.  Instead, conservative state leaders denied healthcare coverage to some 2.5 million people in order to claim a scalp from Obamacare.

Conservatives at the time trotted out half-hearted pretextual reasons for spurning the Medicaid expansion.  Some argued that they didn’t believe the federal government would maintain funding for Medicaid.  Others second-guessed Congress for running deficits and taking on new debts to extend healthcare to more people.

The irony, of course, is that until now, the federal government has never permanently reduced state funding for Medicaid—and has twice increased funding in the last twenty years.  (A small exception was in 1981, when President Reagan and Congress enacted a temporary Medicaid funding cut.)  It required a conservative takeover of Washington to bootstrap in the spurious fear of Medicaid cuts that their ideological brethren supposedly fretted over in the states.

What’s more, the concern-trolling of state conservatives over the federal debt is proving just as hollow.  Congressional Republicans are poised to slash Medicaid funding for the poor with one hand while doling out gargantuan tax cuts for the wealthy donor class with the other.  The net impact of squeezing Medicaid on the federal debt will be negligible at best.  Yet the silence from conservative fiscal hawks is deafening.

A second irony (really more of a tragedy) in the Republican healthcare ransacking is that Medicaid had been the most successful vehicle for Obamacare’s coverage expansion, helping cut the uninsured rate in the United States to never-before-seen lows.  The subsidized private insurance marketplaces have only reached half the size that the Congressional Budget Office expected when the law was enacted.  But Medicaid has outpaced expectations, signing up 40 percent more people than CBO expected—even though a couple million people have been blocked from signing up by conservative state governments.

Medicaid is an inherently institutionally vulnerable program because its traditionally thought of as a program principally for the poor.  Liberals like Bill Clinton have tried to refashion our perception of Medicaid over the years, pointing out (correctly) that it provides life-saving and valuable services for the middle-class, too.

Up until now, Medicaid’s protectors have been able to stave off the full conservative assault on the program.  But it’s not without its scars from the persistent attacks.  Seven years after Obamacare became law, conservatives are still hunting for enough scalps to claim a victorious repeal.  And now that they’re in power, Medicaid is their juiciest target.  Perhaps they really will live out the fantasies of Paul Ryan’s keg parties past.

TrumpCare dies another death

lucy-football

An action shot of the House’s latest attempt to repeal Obamacare

As if trapped in a time loop, Republicans yet again pulled their Obamacare repeal bill after—yet again—failing to come up with the votes to pass it out of the House:

“An 11th-hour White House push to give President Trump a major legislative victory in his first 100 days in office broke down late Thursday as House Republican leaders failed to round up enough votes for their bill to repeal the Affordable Care Act.”

There is no mystery here: no matter how much they try to tweak their bill, there is no congressional majority to eliminate Obamacare’s coverage gains.  There is no majority in the House, and certainly not in the Senate.

The relentless push to repeal Obamacare that became party dogma in opposition has deflated under the reckoning of governance.  The puritanical faction of Republican true-believers that would follow through on the bluster of opposition simply does not constitute the majority needed to pass laws.

That’s because the core question is whether government will backtrack from its commitment to ensuring decent, affordable healthcare for everyone.  Another way of putting it is whether government will abandon the principle that those with the misfortune of illness are not second-class citizens and are entitled to security in health and wellbeing just like everyone else.

Stripped of its wonkery (of which I am happy to indulge), that’s what this debate comes down to.  The House’s first repeal attempt fell apart because it would have buried the poor and sick with outrageous new costs and thrown them off their insurance.  Its newest attempt faltered because it would subject Obamacare’s protections for the sick to a veto by the states, segregating some people with costly illnesses into theoretically (but not really) separate-but-equal insurance pools.

Republicans have not yet mustered the blind political might to execute either act of cruelty.  Enough of their party has hesitated in the face of retreating from the government’s duty to protect the sick.  Indeed, reports suggest that as many as 50 House Republicans secretly do not want any part of Obamacare repeal.

Which is not to say that the so-called moderates are eager Obamacare supporters.  When Obama’s veto shielded them from political responsibility—that is, before the GOP was firing “live rounds”—House Republicans passed bill after bill repealing Obamacare.  This empty gesture amounted to a statement of the ideological preferences of the moderates—a philosophical opposition to the idea of government guaranteeing healthcare.

But reality has asserted itself now that Republicans are in the seat of power.  Obamacare’s endurance comes from its fundamental principle that healthcare is a right.  It shifted the baseline on how our healthcare system operates, and shifted political dynamics accordingly.  These new political dynamics are what the GOP willfully didn’t see coming—and what are now coming home to roost, eroding the legislative muscle behind rescinding Obama’s greatest achievement.

One must wonder what the whole point of this latest exercise in futility was.  Why go through the doomed charade of negotiations between the House Freedom Caucus and the Tuesday Group given the raw math facing repeal?  Was it to pin blame on the moderates?  On the Senate?  For Paul Ryan—who a month ago admitted that “Obamacare is the law of the land”— and the House leadership to pass the buck to the rest of their caucus?  To throw a Hail Mary attempt to give Donald Trump the semblance of an achievement within his first 100 days in office?

Probably some combination of the above.  But whatever it was, the bigger mystery is just how many times Republicans will fall on their face before coming to terms with their unthinkable: that Obamacare is here to stay.

Commonwealth Fund

I’ve been collaborating with the non-profit healthcare think tank The Commonwealth Fund to put together a series of brief explainers on various conservative health reform proposals.  These aim to provide the basics on the function, backstory, and impact of various health policy ideas.

The first of these explainers are available now; I’ll update this post as forthcoming explainers go live:

Obamacare’s veto problem—and how to fix it

Emboldened progressives have spent much of the last two weeks cheering Obamacare’s triumph over the Trumpcare repeal train-wreck. But meanwhile, a pair of developments have quietly highlighted the limitations of Obamacare as a framework for truly providing healthcare to everyone .

Obamacare has cut the ranks of the uninsured to historic lows on the strength of its private insurance marketplaces and its Medicaid expansion. But too many actors disinterested or outright hostile to the law’s goals have the power to get in the way of universal healthcare. Quite simply, Obamacare’s design has left it subject to too many vetoes.

First came the news that the major insurer Anthem is considering exiting Obamacare’s marketplaces.  Anthem’s exit, the latest in a string of high-profile departures, could be a particularly painful blow. In fourteen states, Anthem sells Blue Cross Blue Shield plans—historically the insurer of last resort on the individual market. Anthem is currently the sole insurer in nearly 300 counties, serving around 250,000 people. If Anthem quits Obamacare, people in parts of four states would be at risk of having no insurer willing to sell on the individual market.

Next came Kansas’s failed attempt to expand Medicaid. Kansas is one of nineteen states that have refused to take federal funding to expand Medicaid to people earning just above the poverty line. Last week, both houses of its state legislature voted to finally expand Medicaid. Yet arch-conservative governor Sam Brownback barely batted an eye before vetoing the bill on the spurious grounds that “The cost of expanding Medicaid under ObamaCare is irresponsible and unsustainable.”

The Kansas House of Representatives tried to override Brownback’s veto this week, but came up three votes short. As Vox’s Sarah Kliff observed, “65 percent of Kansas legislators support Medicaid expansion. But it failed because they needed two-thirds support to override Brownback[’s] veto.”

This leaves at least 56,000 Kansans ensnared in a coverage gap: too rich to qualify for Kansas’s Medicaid program, but too poor to qualify for subsidies on Obamacare’s marketplaces. And in Kansas, “too rich” means parents earning more than $7,760 per year—38 percent of the federal poverty line. (Forget about Medicaid if you’re a childless adult in Kansas—you don’t qualify, period.)

These two events—Anthem’s cold feet, and Brownback’s cold heart—get at the core vulnerabilities of Obamacare’s coverage expansion. Businesses get a veto over Obamacare if they don’t think they can make enough money participating in it. If too many insurers think that selling in a part of the country doesn’t make sense for their bottom lines, that region is written out of national health reform not by its democratically-elected representatives, but by private corporations.

On the other hand, states get a veto over Obamacare if their governors or legislatures have ideological misgivings about the law. Of course, Obamacare’s drafters never intended this—it was the Supreme Court that made Medicaid expansion optional. The Court’s decision made it easy for state-level conservatives to flex their hostility to Obamacare and to second-guess the budgeting decisions of Congress. So a determined conservative governor or legislature can blow a massive whole in Obamacare by turning down free federal money to provide insurance to the poor.

Neither veto is tenable for a durable system of universal healthcare. As I have written, a universal healthcare scheme cannot only depend on the business calculations of private corporations. Yet as presently constructed, healthcare officials have no way to guarantee offerings on the insurance marketplaces. The Obama administration routinely cajoled recalcitrant companies to sell in parts of the country in danger of too little competition—a last-ditch effort that the Trump administration will be in little rush to emulate while it waits for the law to “explode.”

Universal healthcare can’t just bet on insurers voluntarily selling plans in every part of the country. The number of counties with one or fewer insurers is projected to swell over the coming years. Insurers are eager to sell in states with high population densities like New York and California, but aren’t sure they can make money selling in rural states like Alaska. This has left health reform proponents marking their calendars for June 21. That’s the day by which insurers must decide whether they will sell plans on Obamacare’s marketplaces next year—and therefore the day we’ll find out how much of the country will be graced with universal healthcare.

That’s simply not sustainable. Instead of counting on private companies to provide universal healthcare, we should revive the public option as at least a fallback in states with too few insurance offerings. This was a good idea that embraced by both Democrats and moderate Republicans during Obamacare’s drafting, but was ultimately jettisoned. By the end of his presidency, Barack Obama himself was pushing for this reform. Obamacare needs a backstop—we cannot just settle for an insurance desert where companies refuse to sell. A public option would do the trick.

Then there’s Medicaid. Kansas’s inability to expand its program even in the face of supermajority political support is a sign that it’s time to harmonize and simplify control of Medicaid. Medicaid has long been a joint operation between the states and the federal government. The federal government provides much of the funding, but we have fifty different Medicaid programs across the country.

Instead of leaving healthcare for the poor at the mercy of state politics, we ought to simply let the federal government take the reins of the entire Medicaid program. This would guarantee coverage for all who qualify, regardless of the state they happen to live in. The states would be freed of a massive fiscal burden, and 50 different bureaucracies would be eliminated, letting the federal government better streamline cost control experiments.

And after federalizing Medicaid, we ought to expand it again to cover more people. Medicaid has been a tremendous success under Obamacare, and we should build on it further.

Though nonstarters in the current political environment, these steps are vitally necessary to strengthen universal affordable coverage in the United States over the long term. Obamacare has too many places where those driven by profit or ideology can hack away at the goal of universal healthcare. Eliminating these veto points is the next step in reaching the dream of healthcare for all.

The simple appeal of single-payer

Sarah Kliff reports at Vox on the surprising popularity of single-payer healthcare even among Trump voters. When she asked a group of Trump supporters in Harrisburg, Pennsylvania, whether they wished we had a single-payer system like Canada’s, “[h]alf of the hands shot up.”

In one sense, this shouldn’t be all that surprising. Though often written off as a fringe fantasy, single-payer healthcare consistently polls well, drawing support even among Republicans. There is an element of the idea that has universal appeal.

But yet, the popularity among conservative voters is curious.  Kliff says fairness and consistency are two key draws of single-payer.   “The voters I’ve interviewed like the idea of everybody getting equal treatment, no matter where they live or how much they earn,” she reports.

That’s undoubtedly part of it. But I suspect something even more basic and practical accounts for single-payer’s enduring appeal. And that, simply, is its simplicity. People want out of the exhausting bureaucracy and byzantine complexity that is the American healthcare system. Our system is a confounding ad hoc kludge-on-kludge concoction of a public-private partnership layered on top of public programs grafted on to a tax-preferred fringe benefit.

When it comes to reform, relief from uninsurance and rising costs is just the beginning. People also want deeper relief from the sheer taxing ordeal of American healthcare: the churn between fragmented programs, the stress of navigating provider networks, the uphill futility of doing battle with insurance companies. When people look to government to reform healthcare, they aren’t just looking for help financing it—they want government to take on the stress and headache of navigating the entire system. Government should be a healthcare agent, not just a benefactor.

We often think about the size of government as a philosophical and horizontal continuum: how much space is government occupying? How much private industry is it regulating or displacing? But the individual experience may be much different. Individual Americans experience big government in a much more practical, vertical sense: how deeply are government systems imposing on my life for the worse? What costs—through taxation of either my income or my time and mental bandwidth—are government programs assessing me?

For most people, single-payer healthcare doesn’t inherently offend these anti-big government sentiments. Government absorbing the insurance system would ultimately streamline the healthcare financing experience for patients. The administration of healthcare financing would be synergized down to a single point: the federal government. That makes things a whole lot simpler for patients.

And because everyone would draw benefits from single-payer, they wouldn’t necessarily resent government spending on healthcare as a giveaway to someone else. For instance, Medicare enrollees, having paid in to the system over their lifetimes, want to “keep your government hands off my Medicare.” Because they have paid taxes in exchange for clear and visible benefits, Medicare beneficiaries don’t experience government-run health insurance as “big government.” Neither would enrollees covered by a broader single-payer system.

Strangely enough, it’s possible for individuals to experience a centrist program like Obamacare as “big government” in a way that they might not experience a typically left-wing program like single-payer. Obamacare provided much-needed relief on the basics of health insurance by guaranteeing access to it and subsidizing the cost. But it has done little to ease broader stresses endemic to our healthcare system. Indeed, Obamacare adds more complexity, with means-tested benefits for private insurance for some, and expanded public insurance for others. Either way, it’s a government program that requires consumers to make complex choices, figure out their own eligibility, and weigh different networks, premiums, and deductibles against each other.

The appeal of single-payer as the next order of health reform is that it would lift this burden off the individual. Single-payer would certainly be highly disruptive (perhaps existentially) for industry stakeholders. But for the day-to-day lives of actual people, it would be liberating.

Of course, our politics is skewed to avoid “big government” as business and industry experience it. My own suspicion is that, regardless of the theoretical benefits of single-payer (of which there are many), we are too far down the road of our own ramshackle system to tear it up and start over wholesale. Those with a stake in the current system would undoubtedly mobilize to defeat single-payer—especially once it comes time to dole out the massive tax increases needed to pay for it.

Where single-payer becomes possible, however, is in a crisis. And Republicans are courting just such a disaster by working to sabotage Obamacare. As David Leonhardt of the New York Times puts it, “if voters like government-provided health care and Republicans are going to undermine private markets, what should Democrats do? When they are next in charge, they should expand government health care.”

But even if single-payer comes to naught in the United States, the source of its appeal should guide the future of our public policy. Twenty-first century life imposes too many burdens and complexities on people. Maybe they just want government to lift some off of their backs.