Speaker Ryan vastly overstates his case

Speaker Paul Ryan says his proposal to repeal and replace Obamacare is “what good conservative healthcare reform looks like.” He adds:

It repeals Obamacare’s taxes; it repeals Obamacare’s spending; it repeals Obamacare’s mandates. It creates a vibrant market where insurance companies compete for your business. Where you have lower costs, more choices, and greater control over your healthcare. And it returns power—this is most important—this returns power from Washington back to doctors and patients, back to states.

There is some truth to these claims. Ryan’s proposal repeals Obamacare’s mandates, most its taxes, and some of its spending.

However, as Philip Klein of the Washington Examiner shows, the rest of Ryan’s pitch does not withstand scrutiny. Indeed, “as a result of the spending and regulations that are retained by the bill, the rest of Ryan’s comments cannot possibly be true.”

Klein explains:

If the federal government is dictating the design of insurance policies and imposing regulations that naturally drive up the price of insurance [as it will continue to do under Ryan’s plan], then the market won’t be vibrant, consumers won’t have more choices, and they won’t experience lower costs.

Only by getting rid of the Obamacare regulations can Republicans achieve the kind of vibrant market Ryan touts:

If Republicans were to have pushed a true free market plan, it would have removed the regulations and mandates on the type of insurance that must be sold and drastically reduced spending through Obamacare. By reforming the tax code, it could have used money from changing the bias in favor of employer-based coverage to help individuals purchase coverage in an open market.

To be sure, under this scenario, Republicans would still be fighting off attacks that their plan covers fewer individuals than Obamacare. But they’d also be able to credibly argue that their plan reduces premiums, increases choices, reduces spending, and cuts deficits. This would all fit into the narrative that they’ve been trying to push for months: Obamacare was an unsustainable promise, they inherited a mess, and they had to act responsibly to clean it up.

Klein emphasizes that even under the Ryan plan, Republicans will still be subject to attack for covering fewer individuals than Obamacare does. Why? Because its subsidies are less generous.

I would add that with the Ryan plan the GOP risks more than just somewhat smaller enrollment due to less generous subsidies. The biggest risk is that the Ryan plan will hasten the “death spiral” that Obamacare has induced. I discussed that problem here.

I agree with Klein’s conclusion:

If Ryan wants to limit his argument to insisting that this is the best Republicans can come up with given the fragile Senate majority and the complicated parliamentary maneuvering required to secure passage, it would still be a faulty argument, but at least it would be within the realm of debatable.

But calling this federal healthcare scheme “conservative” just because Republicans were the ones to concoct it is a farce.