Is GOP Health Care Bill a Disaster? No

Peter Nelson, my colleague at Center of the American Experiment, is one of the country’s leading experts on health care policy. On the Center’s web site, he urges conservatives to take a deep breath and understand the constraints that Congressional Republicans are working under.

In particular, a full repeal of Obamacare must get through the Senate, which means it must get 60 votes. There are only 52 Republican senators. Therefore, the first bill that has been unveiled is intended to be passed under the reconciliation process, which requires only a bare majority. Only Obamacare provisions that have a budgetary impact can be repealed in the reconciliation bill. Other measures will have to follow afterward. Peter writes:

Critics do have reason to complain and demand change, but the current response recklessly sets up the expectation of a full repeal among those in the conservative base, an expectation that Congress cannot meet. Upon failing to meet this expectation, the base may become needlessly demoralized and distrustful.
Republicans can repeal a substantial portion of Obamacare with a simple majority through the budget reconciliation process, but this process only allows Republicans to repeal those portions with a budgetary impact.

Repealing just items with a budgetary impact leaves in place the insurance regulations that are presently driving up health care costs and spinning many state insurance markets into death spirals. Specifically, the reconciliation process can’t repeal Obamacare’s essential health benefit requirements that force people to buy very generous and, therefore, very expensive health plans. Most troublesome, reconciliation cannot repeal insurance regulations that force insurers to sell coverage to everybody, regardless of whether they responsibly maintained coverage. This allows people to wait until they are sick before gaining coverage.
A key problem is that repealing the individual mandate without repealing the requirement on insurers to guarantee coverage increases the incentive to wait to buy coverage until you need it. That’s why the House plan imposes a 30 percent penalty on people who buy coverage who failed to maintain continuous coverage. This penalty has been panned by critics, but anyone who studies health insurance markets will tell you something like this is necessary, so long as Obamacare regulations remain in place.

The good news is that the reform process is beginning, not ending. GOP leaders say there are two more bills yet to come, and we have a Republican president whose administration can reverse those portions of the Obamacare disaster that came into being through regulations. Which is many of them.

[A]nother point too often lost in the debate is the role the Trump administration will play in complementing Congress’s work. Though certain regulations cannot be immediately repealed, the Trump administration can modify regulations through the rule-making process. For instance, the Department of Health and Human Services (DHHS) can authorize a much more affordable set of essential health benefits. DHHS has already proposed important changes to stabilize individual insurance markets.

Peter thinks that the Medicaid provisions in the current bill represent a very important set of reforms, and will address that aspect of the legislation soon. In the meantime, conservatives shouldn’t be depressed over what we have seen so far:

Much of the rest of the bill is open for reasonable debate among conservatives—such as those refundable tax credits to buy health insurance—and critics are certainly entitled to their strong opinions and encouraged to share them.

But it’s dangerous if, to foment a public outcry to force changes to the bill, critics instill within the conservative base a sense that full repeal is possible if not for those weak-kneed Republicans elected to Congress. If conservative leaders set unattainable expectations, they will create a perception of failure in Congress that will deflate the conservative base.

Read the whole thing at the link.

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