- The American Conservative - http://www.theamericanconservative.com -

Obamacare: A Toxic Remedy

When the Affordable Care Act survived a slow and painful congressional debate to become law, Democrats knew they would have a rocky few years. But they reasoned that as the benefits started to kick in, Obamacare would become more popular.

In other words, people would learn to like the bill once they knew what was in it.

So far, however, it hasn’t panned out that way. Politico has reported [1] that Democrats are actually fearful of the health care reform law as the 2014 elections approach. Certainly, Democrats who must appeal to reddish voters are keeping their distance.

Elizabeth Colbert Busch, the Democratic candidate in the South Carolina special congressional election, called Obamacare “extremely problematic” in her one debate with Republican romantic Mark Sanford. Sen. Max Baucus has called the law’s implementation a “train wreck” and decided to retire rather than face Montana’s voters as one of Obamacare’s main architects.

change_me

Part of the problem is that the costs are becoming as apparent as the benefits. Companies are shedding full-time employees, cutting workers’ hours, and turning to temps in anticipation of the new law. Other employers are dropping or reducing [2] health coverage to avoid Obamacare’s strictures, a development the Congressional Budget Office now believes [3] will impact 7 million people. These trends have been particularly pronounced [4] in the restaurant industry.

Companies are even beginning to trim overall employee benefits. “Employer spending on benefits rose at the slowest pace on record in the first quarter, as companies began bracing for higher health costs with next year’s launch of ObamaCare,” reports [5] Jed Graham in Investor’s Business Daily, concluding, “Total employee benefits provided outside of government jobs declined outright.”

Low-wage workers are among the hardest hit. Graham reports, “Total benefits in service occupations shrank 0.3% in Q1, the first decline in data going back to 2002.” There was a drop in benefits per employee.

Meanwhile, Republicans have continued to hold votes in the House on repealing Obamacare. Conservative senators sought to block funding for Obamacare implementation. Republican governors have balked at the state health insurance exchanges. Even when GOP governors have accepted [6] the Medicaid expansion, Republican state legislators have resisted it. The party is no longer saddled with a presidential nominee with an Obamacare-like health care record.

A Kaiser Family Foundation poll found that Obamacare has just a 35 percent favorability rating, while a Fox News survey suggested 54 percent [7] still want to repeal the law—right as the White House is rolling it out.

This isn’t altogether unprecedented. The Medicare Catastrophic Care Act of 1988 offered popular benefits for seniors: expanded coverage of hospital stays, more at-home care, and prescription drugs. Unlike Obamacare, it had genuinely bipartisan support.

But the costs proved deeply unpopular with the very people the law was intended to help. When then House Ways and Means Chairman Dan Rostenkowski held a meeting in his deep-blue district to inform elderly constituents of their new benefits, the oldsters ran him out of the room chanting “coward,” “recall,” and “impeach.” A woman threw herself on the hood of Rostenkowki’s car to prevent him from being whisked away, forcing the powerful Democrat to try to flee on foot.

The Medicare expansion was repealed three months later, by a Democratic-controlled Congress. The program had been signed into law by a Republican president—Ronald Reagan, no less—and George H.W. Bush signed its repeal.

Obamacare is a much more partisan issue, something that both helps and works against its ultimate reversal. But at least in the early stages, unintended consequences have hurt its public support. So too has the law’s complexity.

Washington Post policy blogger Sarah Kliff observed [8] that ordinary people don’t even always notice Obamacare’s benefits. Even the dent the law will put in the number of uninsured Americans is small relative to the country’s population.

There is a strong case that Democrats should simply be patient, bank on Republican timidity, inertia, and bureaucratic fixes to Obamacare. And problems with the health care law’s implementation don’t have to lead to a less government-directed system. They could be blamed on the private sector, leading inexorably to something closer to single payer.

Just don’t expect that case to be persuasive to Democrats running in swing states or competitive congressional districts during next year’s midterm elections.

W. James Antle III is editor of the Daily Caller News Foundation and author of the newly released Devouring Freedom: Can Big Government Ever Be Stopped? [9]

61 Comments (Open | Close)

61 Comments To "Obamacare: A Toxic Remedy"

#1 Comment By Rob in CT On May 6, 2013 @ 3:43 pm

The status quo ante involved healthcare costs rising faster than inflation and a lot of people who simply could not get insurance (either due to lack of money or pre-existing conditions).

The ACA reform tinkers with the existing system, which was (and therefore still is) a mess. It’s neither free market nor socialized. It’s a mixture of each.

I see the single-payer (Medicare for all) route as the tried & true superior choice, based on the experiences of the other developed nations. The alternative, far riskier IMO, would be to essentially tear down the system that exists (remove tax preference for employer-provided insurance, repeal medicare & medicaid, and so on), right down to the studs, and go the full free market approach. This would require, at a bare minimum, enforcing some sort of price transparency by law. You can’t expect someone to shop around for healthcare if they have no way of figuring out how much something is going to cost (obviously, in the case of treating serious illnesses, it’s hard to estimate. But 1-off proceedures, diagnostics, etc – that should be priced out clearly). I’d like to see that sort of thing done now, actually.

It would be helpful if Republicans actually wanted to work the problem. It’s crystal clear that they do not.

#2 Comment By sal magundi On May 6, 2013 @ 4:32 pm

“at some point in the future this country will adopt some variant of a single-payer system, thus bringing into fruition what socialists and neo-socialists in this country (starting with Hubert Humphrey) have long dreamed for.”

also dreamed for by people of mere decency who understand that one’s health and life are things that cannot be morally subject to market horsetrading.

#3 Comment By steven On May 6, 2013 @ 5:00 pm

Part time hiring is “starting” in the services sector/restaurant industry as a result of the ACA? Service sector employess will lose their “benefits”? Even megan mcardle admits that, to the extent there are any benefits in this sector, they are generally scams:

[10]

“Now, it occurred to me that Sebelius might be thinking about the scam insurance that is all too often sold to naive, mostly lower-middle-class folks who labor in the service industry. That stuff isn’t insurance at all; it’s a fraud, and the people who sell it will richly deserve any justice that is meted out to them in either this life or the next. But that stuff doesn’t protect your mortgage, either; they’re almost-worthless discount plans or very-limited-coverage insurance sold by fly-by-night operations who tend to evaporate as soon as claims have to be paid. So I don’t think that’s what she’s talking about; I think she’s talking about catastrophic plans.”

Here are some examples of the “benefits” that are under threat at places like macdonalds:
[11]

“The least expensive health insurance coverage costs workers around $700.00 a year. This gives the worker up to $2,000 of medical coverage.”

“The more expensive plan costs workers around $1,700 per year, and gives that worker up to $10,000 in benefits. However, this plan stops paying for outpatient treatment after $2,000 of costs have been accrued and only after the worker has paid all deductables.”

The medicaid study probably has implications far beyond medicaid. If medicaid is not leading to significantly better outcomes(and actually the study only concludes this for a limited set of chronic conditions), then why should we believe that insurance for the more affluent is leading to better outcomes? Are the affluent going to drop their insurance coverage as a result of this study? And given mcardles argument that insurance should protect only against catastrophic risk and financial ruin why do the wealthy have the most robust and generous medical insurance packages? In fact why should the very wealthy, who could perfectly well afford to pay the costs of any medical problem out of pocket, have any insurance at all? Surely mcardle should be chastising all the affluent to drop all their insurance coverages, of any kind?
I agree with mcardle that people have come to view insurance as a way of avoiding any out of pocket expense and that this isn’t the point of insurance but the definition of catastrophic is heavily dependent upon your financial situation. If we can get conservatives to the point where they would support “picking up the tab for any medical expenses above 15-20% of income” we would have made enormous progress. This is just a pointless “option” that people acting in bad faith throw up because they know it will never happen.

The market for health insurance doesn’t work like many other markets. Forcing people to pay for health care out of pocket will not cause them to shop based on price and quality. People have no ability to assess the legitimacy of their doctors advice, especially when they are afraid and in pain and getting a second opinion isn’t going to dig us out of our problem of rapidly escalating health care costs. If one really believes all of this then surely the primary objective shouldn’t be to deregulate the private insurance industry but to do away with insurance and risk pooling entirely?

Why have lasik prices gone down? The answer is that lasik is an unnecessary, elective procedure, done mainly for cosmetic reasons(such as to avoid wearing glasses). Trying to extrapolate from this to the market for people who are dying of cancer, who have bone jutting out of their arm, etc. is frivolous.

So we are supposed to conclude that the poor and middle class don’t really need insurance. We move to a free market in which the wealthy get limitless and pointless health care while everyone else with broken arms, cancers, etc. can left to suffer.

Why do the rich choose to do something so counterproductive and stupid as buying insurance if these theories are correct? Or perhaps it isn’t stupid at all and this is just an argument to justify having many others do without?

#4 Comment By Marc On May 6, 2013 @ 5:12 pm

JonF says:
May 5, 2013 at 3:16 pm

Re: Just because some poor person wants or needs healthcare doesn’t give you or anyone else the right to force me to pay for it.

As long as it is done legally the right to do so is there. If that weren’t true we could not levy taxes in anyone for anything they don’t like and civilization would be impossible– but that is not how the world works, it never did and never will. Deal with– or leave. Otherwise if you are going to live in this world as part of the human species and its civilization you are obliged to live with its rules, from natural laws like gravity to human realities like taxes and laws. No one here is a sovereign god, you’re just a human being and you owe this world for your place in it and the civilization which you were gifted with from your first breath though you did nothing to earn it.

I think you are confusing powers with rights. Yes, through the magic of democracy you can give government the power to compel members of society to do just about anything. Just because government has the power to enforce laws doesn’t mean that the laws themselves are just. Remember, slavery was legal and the Federal government enforced fugitive slave laws. No matter what laws were on the books, no one had the right to take ownership of other people. Thankfully, there were brave folks who risked Federal prosecution and ignored those laws.

For most of the Progressive here, they have to qualm with government using threats of aggression to compel people to do what they want. Let’s understand something about government. Government is not compassion; government is force. Whenever government performs an action it acts not compassion but with force. When you advocate for any government program, what you are advocating is for government threaten aggressive violence towards people. If people don’t comply with your laws, they will have what wealth they have plundered through penalties and interest and they may be thrown into prison. If they resist these enforcement actions, they will likely be aggressively subdued or even killed. The only legitimate use of violence is to repel illegitimate violence. For whatever government programs you advocate for, you threaten violence against people who committed no acts of violence towards others or did not take or injure the property of others if they fail to comply with your demands. So no matter what powers you give to government to implement whatever program you wish for it to enact, you do not possess the right to threaten aggressive violence towards peaceful people noncompliance.

Regarding civilized society, there existed civilized for in the US for over 130 years without an income tax, various New Deal programs (including Social Security), Great Society programs (including Medicare and Social Security), or the plethora of other Federal and state agencies. In fact, I would go as far to say that society was far more civilized in the past than it is today. The idea that a massive central government (like the US Federal government) is a prerequisite for a civilized society to exist doesn’t hold a shot glass full of water. Regarding what is owed to civilized society, all that is owed is a) commit no acts of violence towards others b)don’t steal from others and c) honor all contracts that I voluntarily enter into. I don’t owe civilized society all or significant portions of my income. Like I mentioned before, for over 130 years in the US there was no direct taxation of citizens by the Federal government and somehow civilized society managed to exist.

#5 Comment By Marc On May 6, 2013 @ 5:33 pm

Rob in CT says:
May 6, 2013 at 3:43 pm

The status quo ante involved healthcare costs rising faster than inflation and a lot of people who simply could not get insurance (either due to lack of money or pre-existing conditions).

The ACA reform tinkers with the existing system, which was (and therefore still is) a mess. It’s neither free market nor socialized. It’s a mixture of each.

I see the single-payer (Medicare for all) route as the tried & true superior choice, based on the experiences of the other developed nations. The alternative, far riskier IMO, would be to essentially tear down the system that exists (remove tax preference for employer-provided insurance, repeal medicare & medicaid, and so on), right down to the studs, and go the full free market approach. This would require, at a bare minimum, enforcing some sort of price transparency by law. You can’t expect someone to shop around for healthcare if they have no way of figuring out how much something is going to cost (obviously, in the case of treating serious illnesses, it’s hard to estimate. But 1-off proceedures, diagnostics, etc – that should be priced out clearly). I’d like to see that sort of thing done now, actually.

It would be helpful if Republicans actually wanted to work the problem. It’s crystal clear that they do not.

I agree with you that the status quo stinks and tinkering around the edges of the ACA won’t solve anything. But I don’t see why I should be forced to participate in a single payer healthcare system. If you believe that a centrally planned healthcare system can provide a better service and a superior value then you should voluntarily join and I should be free not to join. You should agree to have your taxes raised to pay for it all and I should be free to be left alone. If government can provide superior services as compared to the private sector, let them compete with it. If government is super efficient they should demonstrate to the public that their healthcare system is efficient just like they did with AmTrak or the USPS. McDonald’s has served billions and billions of customers and not one was forced to buy their product under the threat of fines and imprisonment. Apple has been able to sell millions of iPods, iPhones, iPads without having to threaten anyone with fines or imprisonment for non-participation. What would life be like if government were granted a monopoly to produce all goods and services. How enjoyable would life be if we only got the opportunity to choose one kind of car, house, computer, refrigerator, or TV. It would be pretty bad. Why should we have only one healthcare system?

#6 Comment By Marc On May 6, 2013 @ 5:55 pm

Dylan says:
May 5, 2013 at 12:24 pm

Marc, as much as I appreciate your arguments, I have to agree with public defender. True libertarians (as opposed to those obnoxious people who slogged through “Atlas Shrugged” and now feel justified celebrating the virtue of their selfishness) have many good theoretical points. A true free market for any good is a nice idea, and there’s plenty of room for that approach in a lot of areas policywise. But I think health care at this point is beyond “let’s let the market take care of things”. Government is inextricably involved in it, and it’s a good that any halfway moral person wants every person to have access to, so some sort of collective action is necessary. I’m skeptical about PPACA being the correct action, but the Republicans really haven’t offered anything better. I have a libertarian disposition. I don’t like arbitrary authority or the violence that’s inherent in government, and I’d like those things to be decentralized as much as possible. But we’ve got a centralized mess, and we have to fix that centralized mess, because meanwhile people are living and need to be able to go to the doctor.

Yes, I would like to see poor people have access to good healthcare. The only institution that’s standing in the way of people getting good, affordable healthcare is government. It’s licensing laws prevent many potentially qualified people from entering the healthcare profession. Think how much cheaper healthcare would be if there were more healthcare professionals and hospitals competing for business. It wouldn’t surprise me if there are thousands if not tens of thousands of medical professionals across the globe who would love to come here and open up a hospital or clinic if it weren’t for licensing and permitting laws. The American Medical Association may not like competition but I say YES to eliminating government’s involvement in healthcare so that the poor will have access to good affordable healthcare. Government regulations prevent many lifesaving drugs from entering the market. Also, regulatory compliance significantly raises the cost for new drugs. So I say YES, lets improve access to healthcare for the poor by eliminating the FDA. Something that should be noted is that under a single payer healthcare system healthcare will be rationed by the government. Instead of the poor having real choices in healthcare, their healthcare will be dispensed by a central planning committee. The poor will not be able to get the care that they want when they need it. Instead, they will receive healthcare in accordance with the central planning committee’s cue, which will take months. So I say NO to a single payer healthcare system.

#7 Comment By steven On May 7, 2013 @ 12:00 am

It is wrong to say that progressives have no qualms about using the force and compulsion of the state.
Nor are progressives ignorant of the fact that the state always rests upon having a monopoly on violence and murder.

But progressives also understand that neoliberal economic ideology and corporate capitalism are not natural facts, like gravity, but are the result of powerful people using the very same state and its coercive power to evolve a particular kind of social order. That social order is no more necessary or eternal than any other and progressives aren’t prepared to give the extremely powerful and wealthy few who rule that order unlimited and unconstrained power to do as they please in the name of liberty because history teaches us that they, like any others with immense power, will abuse that power and use it to harm and control others.

“It’s licensing laws prevent many potentially qualified people from entering the healthcare profession. Think how much cheaper healthcare would be if there were more healthcare professionals and hospitals competing for business. It wouldn’t surprise me if there are thousands if not tens of thousands of medical professionals across the globe who would love to come here and open up a hospital or clinic if it weren’t for licensing and permitting laws. The American Medical Association may not like competition but I say YES to eliminating government’s involvement in healthcare so that the poor will have access to good affordable healthcare. ”

Health care professional implies a licensing system that distinguishes what is required to be a health care professional from the average citizen who is not a health care professional. There is no “professional” without the licensing that you want to do away with. What you mean is that anyone should be free to hang up a sign saying they can heal people. If we simply let anyone from around the world come here with the dream of making money being a healing practitioner in america it might be a market in something but it wouldn’t be a market in “good affordable health care”.

” Also, regulatory compliance significantly raises the cost for new drugs.”

The primary cause of high drug costs is the monopoly granted by the state(and its coercive violent power) through patent law, not the FDA.

“Something that should be noted is that under a single payer healthcare system healthcare will be rationed by the government.”

As opposed to rationing by wealth. Medicare is an extremely popular single payer system, even among many tea party people, and I don’t see a massive uprising against its horrific rationing of care. Most elderly americans understand that they would be far worse off if they had to pay for private insurance in the market. In fact most of them would be uninsurable or the cost of insurance would be so high that only the wealthy would be able to afford it. It would also drastically increase the cost of insurance for the rest of us if we dumped a lot of sick elderly people onto the private market. They represent the overwhelming majority of health service consumption. Libertarians might find it philosphically satisfying to save x dollars in taxes at the cost of paying multiple times x to a private insurance company but most people understand that they will have less money, not more, at the end and that, not how much they pay in tax, is, and should be, the primary concern for anyone looking after their financial interests. Costs under medicare are lower and are rising, but more slowly, than the private insurance market.

“Instead of the poor having real choices in healthcare, their healthcare will be dispensed by a central planning committee. ”

No, their health care would be dispensed by the same private providers that dispense health care today. We are talking about the payment system, not the provider system.

#8 Comment By public defender On May 7, 2013 @ 4:52 am

I’m going to keep repeating this right? I cannot undertake to lay my finger on that article of the Constitution which granted a right to Congress of expending, on objects of benevolence, the money of their constituents.

The 16th Amendment expressly authorizes an income tax, and yes, that was not part of the Madisonian view of the federal government–that’s why we needed an amendment. Madison might not approve of the current view of interstate commerce doctrine, but the extent of interstate commerce that we have today would have been inconceivable in the days of travel by horse between very rural colonies. Today, it’s hard to do anything with engaging in commerce with other states. Not so in the Eighteenth Century.

And the anti-ACA arguments here just prove that the anti-ACA side has nothing to replace Obamacare that could actually be enacted. To repeal a complex law, you need words on paper to and the votes to enact those words. ACA critics can’t do that and have no plan to do that.

#9 Comment By EliteCommInc. On May 8, 2013 @ 12:36 am

“And the anti-ACA arguments here just prove that the anti-ACA side has nothing to replace Obamacare that could actually be enacted.”

uhhhh. That is accurate, I’d like it crumble . . . as for replacing it. Maybe the market should be given a shot — the real market.

The market that actually places a customer in the drivers seat in which he or she decides what hospital, surgeon and what they are willing to pay.

#10 Comment By Rob in CT On May 8, 2013 @ 1:09 pm

I agree with you that the status quo stinks and tinkering around the edges of the ACA won’t solve anything. But I don’t see why I should be forced to participate in a single payer healthcare system

It basically comes down to bargaining power and critical mass.

This is why I’m of the opinion that we have to go full-on socialist (single payer) or full-on free market (tear it all down and use the government as referee only). Trying to split the difference has been a disaster.

Here’s what I mean about bargaining power & critical mass: pre-ACA, if you were an individual seeking care w/o insurance or an individual seeking insurance (not a group plan via an employer), you were basically shafted. It’s pretty clear how this happens. So the solution to this is either to get everyone in a group plan with real leverage (Medicare for all) *or* have everyone fend for themselves (and consequently have a lot of people yelling at their doctors about how they can’t figure out what the price is going to be). There are decent reasons why the liberal side doesn’t think the second option would work (these reasons are strongest with regard to emergencies, and weakest with regard to routine care/diagnostics).

I favor single payer because it’s a widely-used, proven model. This is the cautious choice, and I admit that freely. The “bold” option is to pull the (ugly, bug-infested) carpet out from everyone and start anew. This, for fairly obvious reasons, is a *really* tough sell. There were Democrats (and a couple of Republicans, until push came to shove) who favored moving in this direction – those who supported the Wyden-Bennet bill (Healthy Americans Act, I think it was called). The central idea there was to sever the link between employment and health insurance. Theoretically, this is a good idea. The connection exists because of dubious government policy during WWII. It’s essentially a historical accident, and not a good one.

But there was never any real political support for that. When people started talking about it, GOP support vanished like a fart in the wind. Most Dems were scared enough by the (fairly timid, IMO) ACA reform. Something like Wyden-Bennet would reduce them to pants-pissing terror.

#11 Comment By Sud1 On May 30, 2013 @ 1:33 am

hoist with their own petard. The irony is as thick as the average Obama voter.