When Republicans recently unveiled their first attempt to dismantle the Affordable Care Act, it became obvious the leadership was more focused on repackaging and rewriting than repealing and replacing.
Certainly, some changes were suggested that would have boded well for businesses and individuals. While the individual and business mandates would remain a part of the law, the penalty associated with the mandates would be removed — effectively declawing one of the core components of the ACA.
Such a change, however minor in the scheme of healthcare policy, would certainly be a boon to employers who have been hesitant to hire full-time employees in fear of the rising cost of benefits.
Yet, many of Obamacare’s original schemes remained present in the GOP leadership’s proposal, leading free-market proponents to worry that lawmakers were only willing to toy around the coercive system’s edges.
Obamacare’s takeover of the private health insurance market was basically perpetrated by nullifying individual liberty in three new areas. Price controls were imposed on insurance pools, an individual mandate was enforced by tax penalties, and health insurance subsidies for low-income individuals were offered as insurance premiums grew ever more expensive.
Rather than rejecting this heavy-handed approach, the initial Republican proposal actually preserved, and in some important cases even expanded, these three “features.”
The bill, for example, would effectively continue ACA “community ratings,” in order to contain the ACA-level premium costs resulting from the mandated exemptions for pre-existing conditions.
“Cost sharing” subsidies continue as well. And the refundable tax credits associated with the purchase of “adequate” health insurance look like a simple renamed tax penalty for non-compliance.
Moreover, the bill fails to actually address the politically important elephant in the room: high premium costs.
If the Congressional Budget Office’s (CBO) numbers hold up, the Republican leadership’s initial plan would increase premiums by 15 to 20 percent over their already inflated level — only worsening the damage done by the ACA. This would produce more uninsured Americans than a straightforward Obamacare repeal, says the CBO.
Critics who feared a mere fresh coat of paint for Obamacare have been affirmed. Similarities between the GOP’s plan and Obamacare didn’t stop with the philosophical foundation. Other aspects that Republicans criticized on the election trail would continue.
The Medicaid expansion so often derided by Republicans in the last several years remains in the initial proposal. The bill would tinker with the provision — switching it to per-capita block grants after 2019 — but let states continue expanding the program in the interim.
Moreover, regulations on types of coverage would largely remain — handicapping the industry’s ability to offer cheaper, more-basic policies. Thus, premiums would not become truly affordable for healthy individuals requiring little actual care.
For businesses in Nevada, this abandonment of free-market alternatives to Obamacare means little will change, should this scheme get through the Washington gauntlet it faces.
While some punitive aspects of Obamacare would lose their fangs under the Republican proposal, the concerns regarding insurance affordability would remain. The cost of providing benefits to employees would continue to rise, and Obamacare’s downward pressure on economic growth would largely continue to squeeze small and midsized businesses.
So why repackage Obamacare instead of repeal it?
On Fox News, shortly after Republicans unveiled their weak-kneed proposal, Charles Krauthammer identified capitol Republicans’ core fear — that “You simply cannot retract an entitlement once it has been granted. That is the genius of the left.”
Krauthammer’s answer would make more sense if Obamacare had enjoyed broad support and actually provided substantive benefit to most Americans and their economy. Given the program’s lack of popularity, however, it would seem lawmakers ought to be able to do better than repackaging the status quo with red trim rather than blue.
Of course, ample political considerations play into Republicans’ fear of fully repealing the law — Democrats are likely to use whatever process they find available in efforts to stop any substantive repeal. Policy, after all, frequently loses out to rank partisanship.
And yet, Republican leadership seems stuck in an Ancien Regime mode of thinking, where unsound entitlements remain always untouchable and voters won’t care if the dog’s breakfast called Obamacare gets a GOP brand.
However, for those of us who have to deal with the consequences of higher premiums, reduced care and compulsory coverage options, such branding isn’t nearly as important as Americans’ need for much better policy.