Sunday, April 11, 2010

Repeal and Replace, Not Just Repeal

By and large, the Republicans and conservatives are being smart about ObamaCare. ObamaCare is a disaster that needs to be undone. The public remains angry and, if anything, likes ObamaCare even less now than when it passed. This is because companies are already announcing benefits cuts and layoffs, premiums are going up, and ObamaCare supporters keep calling insurance carriers trying to get their free coverage, only to discover that they were lied to. But in the middle of this perfect storm, are a handful of conservatives who are advocating a huge mistake. I am speaking of the “repeal only” crowd.

1. Going From Angry To Unhappy.

The people hate ObamaCare. There is no doubt about that. But the public wasn’t too thrilled with the health care system either before ObamaCare was passed. So what does simple repeal get us? It takes us from a system that everyone fears to a system that no one really liked. How smart is that? Do we really want to be the side that is responsible for imposing a health care system that costs too much, delivers too little, covers too few, and is slowly collapsing under its own weight?

No, we don’t. And that bring us to point two: a blown opportunity.

2. A Blown Opportunity.

Right now, we have a golden opportunity. People are terrified of ObamaCare and they appear willing to accept a repeal. . . but they would be even happier if it was replaced with something that solves the problems of the pre-ObamaCare system.

Rather than just return to a system that no one likes, the Republicans should put together a plan that lifts senseless regulations, uses free market solutions, and provides the limited protections that most everyone agrees should exist. For example, we should:

• Allow national medical licenses to let physicians to move around the country to satisfy consumer demands.

• Allow doctors the freedom to organize in new business arrangements.

• Allow insurers to issue policies across state lines.

• Open the insurance market to new players.

• Prohibit denials based on pre-existing conditions and prohibit cancellation of policies after medical conditions arise.

• Divorce coverage from employment. The link between employment and health care is truly distorting to our economy. ObamaCare is unintentionally breaking that link. We should let Obama take the blame for that, but simultaneously encourage it by cutting all deductions for employer plans. In place of this system, we should (1) allow people to deduct the costs of catastrophic health insurance plans that they buy themselves, (2) expand HSA’s so that people can use pretax money for all of their health care costs, and (3) let consumers group together into buying clubs. Wouldn’t it make sense, for example, to let Wal-Mart start selling insurance policies? They have 300 million consumers. Your current “buyers club,” i.e. your employer, has how many consumers? Who has more power to get good deals?

• To encourage people to get catastrophic coverage, we should make medical debts non-dischargeable in bankruptcy. To encourage them to save for medical expenses, we should let HSA grow tax free like an IRA.
Each of these steps goes a long way toward letting free market mechanisms do their thing, which they can’t right now because of the web of regulations that strangle the industry. And right now, the public would accept this because the alternative is ObamaCare’s corporatist/socialist nightmare.

Repealing only misses this chance.

3. No Risk For The Left.

Repealing only also plays right into the hands of the left. For years, the left has pushed us further and further left. In response, “intellectuals” on the right argued that we need to undo what the left does whenever we get the chance. . . and that’s it. Do you see a problem with this? Well, let me provide an analogy.

You are standing on a football field. The other team keeps pushing the ball toward your endzone. You get the ball back. Suddenly, your brainiac coach tells you, “we’re only going to push the ball back to where the other team started their drive. Then we stop.” Is the problem getting clearer?

The left has nothing to lose under this strategy. They can push all they want in any area they want, and they know that the worst that will happen to them is some dumbass conservative will advocate “undoing” what they did. If we manage to achieve that goal entirely, then the left is right back where it started from -- no harm, no foul, and they get to try again. If we don’t succeed, then the left wins and soon starts pushing again. Either way, we lose.

If there isn’t a chance that the left will actually lose ground when they try these things, they will keep doing them because they have nothing to lose. And we will slowly find ourselves drifting left over time. That is a stupid strategy.

What we need to do is push back and impose free market reforms in place of this socialist crap. Push the ball toward their end of the field. Not only will this raise the risk for the left, but it actually pushes the ball in the right direction. The areas of our economy where the free market has the most influence are the areas that work the best -- and health care isn't one of those free areas.

Conservatives should take this opportunity Obama has given them to push health care into the free market category, not just to return it to its over-regulated, distorted pre-ObamaCare status.

Repeal and replace, not just repeal.


LawHawkSF said...

Andrew: "Repeal only" is a recipe for defeat at the polls for Republicans. I'm glad you wrote this post. I want Obamacare gone, gone, gone. But prior to the worst of the vicious debate and parliamentary dirty tricks, the public was in favor of health care reform. I was in favor of health care reform. The fact that the public is angry over Obamacare doesn't change the underlying issue.

Health care is in need of reform. It must be addressed carefully, thoughtfully, and coherently by the Republican Party. All the elements of your earlier plans need to be ready to go into place as soon as Obamacare starts suffering defeats. Barriers to interstate competition must be eliminated. Pools must be encouraged. Cancellation of policies because an insured actually used the plan must stop. Pre-existing illnesses must be addressed so that everybody can obtain some sort of private insurance. Insurance companies must be regulated so that premiums are based on legitimate forecasting, not solely on profit-margins. On the other hand, they must not be so strictly regulated as to eliminate profits from the formula.

Without those changes in place, Republicans become exactly what the Democrats have dishonestly claimed they are--the "party of no." Obamacare is a disastrous, unfair, hideously-expensive, non-goal accomplishing, government takeover of our lives and health care needs. Doing nothing to replace it is nearly as bad, and I can say with considerable confidence that repealing Obamacare without replacing it with a solid plan for health care reform that removes government ownership and enhances the ability of doctors to do their job and patients to afford insurance is a non-starter.

The people have spoken--to both political parties.

AndrewPrice said...

Lawhawk, Not surprisingly, I agree! LOL!

Seriously, I think this is a golden opportunity to do the right thing, to fix a system that has been messed up with 60 years of government tinkering, and to provide security for all Americans. The idea of just repealing ObamaCare without making those reforms is ridiculous. We will never have a better chance than now to fix this perennial problem!

Moreover, to just go on about "repeal only" does nothing to help our cause and only turns off voters and excites the left.

Smart politics is about recognizing the opportunities we've been handed. This is a big one.

LL said...

The healthcare insurance situation needed attention (of the sort you outline) - and really still does. The Repeal/Replace scenario both puts the public on the right path and explains precisely what the Dems SHOULD have pursued.

Well written.

AndrewPrice said...

Thanks LL! I think you're right -- this not only does the right thing, but it shows the public why the Democrats where wrong and why they should trust us instead.

LL said...

Anyone interested in healthcare also needs to tackle the Medicare problem. (nobody has the courage to) ObamaCare doesn't deal with it because it does NOT address funding. It only lies about funding sources.

Which means, if you WISH to receive Medicare, you should be expected to contribute adequately to that (ponzie scheme) program such that it is self-funded and is NEVER part of the general fund.

I can't imagine an entitlement based society such as ours has become that would embrace the PAIN and actual expense that would incur.

Likewise Social Security, which is an entitlement nightmare.

AndrewPrice said...

LL, You're right. Everyone likes to say "cut waste, fraud and abuse" but that's not really the problem. The real problem is that these programs pay too much and collect too little. It's that simple. And the longer people wait to fix this, the worst it will get.

I think that genuine medical reform will lower prices, which will help Medicaid a lot. But other changes still will be needed -- higher contributions, changing the way we treat people with long term conditions, cutting of some benefits, that sort of thing.

Unfortunately, when Ponzi schemes collapse, it's never pretty. And we are at that point where collapse is imminent. But no one in Washington is willing to take even the smallest steps toward fixing this.

LawHawkSF said...

There is no need for Medicare to collapse. As part of the health care reform bill, those already on Medicare should not have their coverage reduced (it's bad enough as it is). But future Medicare provisions must eventually eliminate the system entirely. It is simply wrong to remove benefits for those who have been forced involuntarily to pay into a system, only to have it taken away for the sake of fiscal expediency. Remember that "pay as you go" health insurance is all well and good for the future, but those who are no longer of an age to pay (or go, for that matter) should not be punished for the government's past profligacy.

Those who have paid into Medicare, but are not already using it should have their benefits rolled into a national health care plan. Some kind of sliding scale can be devised so that the Ponzi scheme fixes itself by the oldest recipients dying from old age (rather than lack of treatment), while those at various stages already paying in are given their proportional share, rolled over into a private plan (and if they choose not to participate, tough--it's their future and their choice, unlike the case of most Medicare recipients).

Insurance company actuaries and government accountants are going to have to figure out a way to create "fully paid-up" health insurance just as they have done for "fully paid-up" life insurance, so that those who have paid into their chosen plan will still be able to retire when they become too old or too sick to work any longer. Without that ability to work and earn, old people would lose their benefits at retirement because they wouldn't be able to afford the health insurance that Medicare was supposed to provide (but won't).

Medicare taxes will have to continue to be charged just to keep the whole thing afloat, but as the number of recipients decreases by attrition, the taxes can be lowered, and eventually eliminated entirely. By that time, a comprehensive system for those young enough and fortunate enough to be working and earning should be fully established under the comprehensive health care reform (not under Obamacare, which only perpetuates or exacerbates the problem).

Those who have paid into the Medicare system involuntarily their entire working lives (while having to pay for a separate, additional health care plan as well while they were ineligible for Medicare benefits) should not have their health care pulled out from under them simply because Medicare was a lousy concept in the first place.

Since we're discussing only health care for the moment, I'll leave Social Security out of it, but the remedy would have to be similar to that of Medicare.

LawHawkSF said...

Andrew: My previous comment to you disappeared, so if this ends up appearing as a duplicate, I apologize.

What is that NRA symbol doing on your newspaper headline? Are you a socialist? LOL

AndrewPrice said...

Lawhawk, re Medicare, I don't think your plan will work politically. You can't ask people to keep paying for something they won't get just because someone else decided to rely on it -- especially people who weren't alive when those decisions were made. I don't see young people buying that.

If they want to save the system, they will need to raise premiums significantly and cut benefits until the program gets closer to balancing, and then beg for tax increases to cover the rest.

LawHawkSF said...

Andrew: As if people haven't been paying into the system for something they're not going to get anyway? Remember who votes. It isn't the silly children who think they're going to live forever and never get sick. They just pay whatever the government tells them to pay. Most of them haven't even given a thought to how much Obamacare is going to cost them--in dollars or actual medical care.

There are millions upon millions of lifelong tax-paying people who are not about to watch their benefits dissolve into thin air. And they vote. The Obamists are already preparing their contingency plans for replacing the billions that Obamacare currently takes away from Medicare. They know what's coming if they don't. At least a draw-down and eventual elimination of Medicare is a coherent plan. As it is, they'll just keep "fixing" it, and taxes are not going to be reduced anyway (in fact, they'll go up as more people enter the Medicare eligibility bracket). The key is to eliminate people entering the Medicare system, not punishing those who are already stuck with it.

If the politicians think Social Security is the third rail they dare not touch, wait until they see what this will produce. People are already used to paying into Medicare, knowing they can't use it for decades. Now, they would just continue to pay for it, at a decreasing rate as the years go on while continuing to pay, as now, for their own health care plan. They won't be hit with anything new as the current users of Medicare begin to die off. They will actually see a tax decrease in their own lifetimes as Medicare disappears. Compared to what Obamacare will cost, financially and politically, a decreasing Medicare tax won't even seem like a drop in the bucket.

I used the word "involuntarily" multiple times referring to Medicare taxes for a good reason. Nobody "chose" to pay the Medicare taxes their entire lives, and nearly as many wouldn't "choose" to rely on Medicare if they had a viable alternative.

Older people who are now empty-nesters and young people who haven't married and have no children pay taxes to support schools in which they have no children of their own. Anti-war advocates pay taxes to support the military. I pay taxes for windmills and solar panels so that foreign dictators can enrich themselves and threaten our security by providing us with petroleum at extortionate prices.

It isn't that difficult to convince people to pay a tax they're already paying anyway in order to keep mom and dad or grampa and grandma from moving into their house because they can't afford to pay for their medical costs. As the pyramid in this Ponzi scheme reduces at the top but stays the same (or nearly so) at the bottom, they will see an actual, demonstrable decrease in their taxes until they are only paying for their own health care and not for those who have gone on to their final reward.

LawHawkSF said...

Most of the people who are now paying into Medicare weren't alive when the system was created, but they pay anyway. Some of them are even catching onto the idea that the system is bankrupt because it keeps expanding. Many rebelled when it appeared the age of eligibility would be lowered from sixty-five to fifty-five. I am firmly convinced that major cuts in Medicare coverage for those already in the eligibility category is a far more difficult political sell than continuing, for a finite period, to pay into a system that will keep the old folks out of bankruptcy and out of their guest rooms.

There's no need to "raise premiums" or "cut benefits" so long as old people continue to die off (I don't think they've invented a true longevity drug yet) and younger people continue to produce tax-payers. As the top of the pyramid decreases while the bottom increases, the individual tax burden decreases correspondingly. And that continues until everybody receiving Medicare benefits has died, along with Medicare itself. End of Medicare, end of Medicare taxes.

USS Ben USN (Ret) said...

Excellent post, Andrew!

Now if we can only find enough candidates to articulate this sound (and sane) plan to the voters.

BTW, I think Lawhawk raises a good point.
Much as I despise medicare, it's perhaps best for all if we phase it out as Lawhawk suggests.

Of course, if anyone can come up with a better way to deal with Medicare that doesn't throw millions of seniors under the bus I'm all ears.

StanH said...

And let Paul Ryan lead the charge!

Writer X said...

Couldn't agree with you more, Andrew. This is a golden opportunity and the Obama promises are already starting to unravel. When do I get my $2500 reduction in insurance premiums this year, as one example of a broken promise. There needs to be an orchestrated message for a revised plan. It needs to happen now.

AndrewPrice said...

Stan, I think Ryan would make an excellent spokesman on this point -- the man is very smart!

AndrewPrice said...

Ben, Thanks! To me, these are obvious steps to improve the system and I think we really miss a golden opportunity if we just ignore them.

On Medicare, that probably needs a separate post, but I certainly agree that something needs to be done. Cutting out a segment of the population is simply not possible politically. Any solution will require making Medicare less important to people -- something like making private insurance more attractive and less expensive while making Medicare people pay the full cost of the benefits they receive.

AndrewPrice said...

Writer X, I agree. There does need to be an orchestrated message and it does need to start now.

The voters need something to get behind, something they can vote for -- not just against. And if we put this plan out there now, they will support it after we win the election. If we just talk about repeal, then there is no clear path after the election.

Moreover, I think this plan just sounds like common sense and people can see the obvious benefits. That goes along way toward building up confidence. It will also assure people that we actually know what we're doing, and the Democrats don't.

patti said...

i have been out of the loop in the last few days and you beat me to this topic. what else can i do but LINK you?! well done, as usual.

AndrewPrice said...

Thanks Patti, and welcome back to the loop!

LawHawkSF said...

Andrew: One additional point that non-Medicare recipients may not be aware of. After paying involuntarily into the system they didn't actually believe in, those who are now using Medicare benefits still pay a substantial quarterly premium in order to maintain their benefits. They don't just get to sit back and get everything for "free." If they want "full coverage," they can also be required to pay large premiums for additional coverage under Medicare Advantage (which Obamacare essentially kills).

AndrewPrice said...

Lawhawk, They are not paying anywhere near the market cost however. People on private plans are paying several times what Medicare people are paying, even leaving aside the employee subsidy, which can be several hundred dollars a month -- and the people on the private plans still face huge deductibles and copays that are much higher than anything Medicare requires.

LawHawkSF said...

Andrew: I agree that this explains the larger costs for private insurance, but I think it also explains why Medicare must be ended at the earliest possible time. My point is not that Medicare needs to be fixed--it needs to end. But I am never going to agree that people who are stuck with the system they had no choice in joining and still have to pay premiums for should be punished for what the government did to them.

It's certainly not as if the oldsters can just go out and get a job to pay for their increased premiums and ongoing medical benefits. A seventy year old would have a tough time finding such a job even in the best of times, and in this economy, it's a near-impossibility, even if they were healthy enough to take such a job.

My whole concept is to end Medicare entirely for those who have not yet become eligible while preserving the benefits for those who are stuck with it. That's why I spoke of a sliding scale for those who have paid into Medicare but will now be part of the revised health care bill you are proposing, while continuing to support benefits for those already stuck in the system. As time progresses, the burden on those no longer in the Medicare system will decrease individually by the reduction of Medicare beneficiaries dying off while the base that pays for those still surviving becomes larger. That also means that as the current beneficiaries of Medicare die off, the need for private insurance to pay more to make up the difference will also ultimately be eliminated. Doctors will no longer have to accept lower fees for their services to Medicare patients because eventually there will be no Medicare patients. That means that the market can finally work without being skewed by a government program that should never have been started in the first place.

But we were also talking about the political effects. Any Republican who says "the old folks will just have to bite the bullet" is an immediate target for Democrat demagogues. And frankly, I haven't forgotten my old street ways, and at my advanced age, I'm still not so decrepit that I can't lead a major demonstration or two. I truly think that preserving current benefits (and the tax burden that goes with them) while killing the program for the future is a winning political stance, and far preferable to the Democrat schemes which simply wait for a government program to run out of funds, then "fix" it by raising taxes and kicking the problem down the road. At least this ultimately kills the Ponzi scheme that Medicare is without angering such a large portion of the voting public already stuck with it. It's not as if Medicare recipients are the same as the welfare people who were cut off from generous benefits that they did nothing to earn or pay for.

If the two parties are afraid of the Black Panthers, wait 'til they get a load of the Gray Panthers.

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