Saturday, May 9, 2009

Republicans Should Stand Up on Health Care Reform

The Weekly Standard has a new article on the upcoming health care reform. We know it's coming. What is almost as alarming as the reform itself is the seeming "fatalistic" response to ObamaCare from the GOP.

In sum, this is the short version of the proposed reform [emphasis mine]:

"The program's basic shape seems likely to follow the outlines of Obama's campaign proposal. Employers would be required to provide health coverage or pay a fine, proceeds from which would support the creation of a new government-run insurance option. There would be a national insurance exchange through which those without access to employer-provided coverage could enroll in the public plan or one of a range of private plans that agree to certain conditions (including covering all comers, regardless of health status). And those below a certain income threshold (likely around 300 percent of the poverty line) would receive subsidies to purchase such coverage.

"This is clearly intended to be transitory, rather than a final program. It would create incentives for employers to drop their health coverage plan (by making it cheaper to pay the fine than offer coverage) and would enable the new public insurance plan to undersell private insurers by imposing price controls similar to those employed in Medicare. A large number of workers finding themselves without their old employer-based coverage would "opt" for the public plan, creating, in effect, a massive new public health insurance program. "

There are lots of problems and flaws with this plan which is one point the WS article aims to bring out; the GOP has room to fight here and should drop the "oh well there's nothing we can do" attitude. Yes, it's true that the ObamaCare plan tweaks out the things that doomed HillaryCare in 1993 and 1994, but there are still flaws to be negotiated.

Americans, for the most part, don't want the regulation that is going to eventually come with ObamaCare. We don't want want to be told what kind of care we are entitled to have. Nobody wants to look at their grandmother and say, "Sorry, you can't have that cataract removal - you'll just have to go blind."

The cost of the plan is another sticking point where the GOP could negotiate. According to the WS article, the ten year price tag will exceed $1 trillion. There's no way that "fines" from employers refusing to provide coverage will pay for this. Increased taxes will be coming. Painful spending cuts, (probably in defense!), will be coming.

Amity Shales wrote about this last week on Bloomberg. She said, the administration has already said "it will cut, by $177 billion, payments to private insurance plans that serve senior citizens through Medicare. That by itself will make insurance costlier for the rest, because private companies will doubtless shift some of those costs to non-Medicare policies. The administration will also need to raise taxes, and almost all the increases under discussion are ones that affect employers."

The Stimulus bill has already provided the groundwork for some of this by creating the National Coordinator of Health Information Technology which will monitor treatments to be sure your doctor is not exceeding what the federal government deems necessary.

It's doubtful that all of this reform will be crammed through by the 2010 elections, so there is hope on that front as well. But if the Republicans don't stand up and fight the rough edges of this reform, the damage will be more difficult, if still possible, to undo.

Betsey McCaughey on Lou Dobbs (video)
National Coordinator of Health Information Technology
Larry Summers on ObamaCare

More links at Memeorandum

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