by John McClaughry As the Republican Congress struggles to “repeal and replace” Obamacare, the political landscape is steadily shifting. Since the Democratic Congress enacted Obamacare in 2010 (without a single Republican vote), Democrats have increasingly been on the defensive about their creation. The individual mandate that Obamacare relied upon to corral healthy young people into insurance pools has failed to do the job – partly because the tax penalty was not severe enough, and partly because the Obama administration felt compelled to create 14 different types of “hardship exemptions” that exempted millions of young people from the penalty.
Furthermore, Congress refused to fund the “cost sharing reduction” feature that paid insurance companies to give discounts to lower income purchasers. Obama’s desperate efforts to keep this revenue source flowing to the insurance companies ran afoul of the law, and is currently enjoined by a Federal court (on appeal).
The result has been soaring premiums to cover the expenses of older and sicker pools, and the exit of insurers from Obamacare exchanges where they can’t find a way to recoup their losses.
Until recently, the Left, determined to protect Obama’s handiwork , has urged only expanded appropriations for cost sharing reduction, which the Republicans – who sued Obama for spending unappropriated money for this purpose – are not likely to agree to. So the Left is now proactively moving away from the unlikely prospect of salvaging Obamacare, toward creating a groundswell for replacing it with their true “solution” – a universal single payer plan.
When Obamacare was debated in 2010, Obama bought the support of the big health insurance companies by ruling out the inclusion of a “public option” – a government insurance company that would compete with (and undercut) the private carriers. The Left regarded this as a sellout, but had little choice but to back Obama’s plan. The 2016 Democratic platform turned down the Left’s urgings for universal single payer, but did include advocacy of the public option as a concession to the Sanders forces.
Meanwhile Sanders has continued his lifelong campaign for “Medicare for All”, without noting that at the present rate of spending, Medicare will be unable to make currently promised benefit payments by 2028. One hundred and twelve of the 193 House Democrats have cosponsored a bill to create a national single payer system.
Last week the Wall Street Journal quoted Senate Leader Mitch McConnell as warning Republican Senators that if they failed to pass legislation unwinding the Affordable Care Act, Democrats could regain power and establish a single-payer healthcare system.
Republican strategist Ed Rogers, writing in the Washington Post, says “it looks as though there will probably be a consensus position among Democrats running [for President] in 2020 in support of a single payer system.”
Apparently those Democrats haven’t taken a close look at Vermont’s pioneering experience with single payer, which ended with Governor Shumlin’s embarrassing abandonment of the idea in late 2014.
But as Rogers put it, “On the surface, single payer universal health care will be hard to beat in the face of rising premiums and onerous deductibles [produced by Obamacare] that Republicans can’t seem to do anything about. A lot of voters will think that Democrats are trying to give them free health care and the Republicans are against it.”
It’s not that Republicans don’t have some very sound ideas about replacing Obamacare. They include income-tested support for catastrophic insurance that reduces the role of third party payments, tax equity for individual premium payers, expanded Health Savings Accounts to pay for ordinary medical expenses, preventive care and wellness programs, state-level innovation for Medicaid acute-care coverage, high risk pools to cover uninsurables, and improved price and outcome transparency to facilitate increased provider competition.
The Republicans’ problem is three fold. Their majorities in both houses can alter tax and spending laws, but they can’t enact a coherent reform package in the face of a Democratic filibuster in the Senate. Most Republicans ran vowing to repeal all of the Obamacare taxes, leaving no revenues to underwrite a reform program. And, distressingly, they have no slogan to compete with “[Free] Medicare for All.”
And there’s yet another wild card. In his 2000 book The America We Deserve, Donald J Trump, who appears to have few if any identifiable political principles, waxed enthusiastic about the Canadian single-payer system.
It’s easy to imagine that Trump, faced a year from now with a Republican Congress’s failure to pass a genuine reform program, polls showing growing support for the Sanders single payer solution, and polls showing his fortunes sinking to unelectable levels, will suddenly decide that Canadian single payer will make America great again.
John McClaughry is vice president of the Ethan Allen Institute (www.ethanallen.org).