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June 18, 2015

House GOP Plan To Save ObamaCare

The Supreme Court is expected to release it's opinion in King vs. Burwell by the end of the month. At stake is the status of ObamaCare subsidies in the 36 states that did not elect to set up a state based exchange. If the Court rules for the plaintiffs it's likely millions of people would have to pay the actual cost of their ObamaCare policies.

You'd think the GOP reaction to people finding out that the lousy coverage, high deductible plans Obama has forced upon them would be, "Good. Now you see why government interference in the insurance market is a disaster. So, let's get rid of it, as Mitch McConnell promised "root and branch.""

You'd be wrong.

The plan, presented Wednesday by Rep. Paul Ryan (R-Wis.), would give block grants to states that want them, according to lawmakers who attended a briefing. States would get to choose how to spend the money to cover people in their state. The grants would last for two years, giving the next president a chance to enact an alternative to ObamaCare.

But if states decided not to accept the block grants, residents would be allowed to keep their ObamaCare subsidies. They would also be allowed to buy any plan approved by the state, on or off the federal exchange.

Emphasis mine.

The GOP's fixation with "block grants" is always amusing. It's still federal spending, it just assumes state bureaucrats are so much smarter than federal ones. Spoiler: the problem is the spending and government expansion, not simply who is doing it. But you don't want block grants? No problem, we'll just pretend we didn't win at the Supreme Court.

Are there some things here that are better than the current ObamaCare rules? Sure but that's not what the GOP has been selling for years, is it? The plan would repeal the employer and individual mandates but Obama won't sign that. And if the federal exchange subsidies are tossed, there is automatically no employer mandate in 37 states.

But the relative good of the plan is outweighed by a major downside. It will now be the official policy of the GOP that the federal government will subsidize the purchase of health insurance by individuals. They will just be arguing with Democrats over how best to deliver on this century old progressive goal.

Yes, this would be a bridge for two years and then the GOP will totes be doing away with ObamaCare. Except that it is now the considered wisdom of GOP health policy wonks and many candidates that universal access/coverage is something they will provide.

Just how important is it that everybody in the United States be able to get health insurance? Conservatives are ambivalent, at best, about that goal. Many of them think that it is more important to restrain the growth of health-care costs; many of them worry that putting insurance within reach for everyone would involve excessive government power. They are right to be concerned about costs and about big government. They should nevertheless overcome their ambivalence. There are good reasons to embrace a conservative health-care policy that enables coverage for all Americans who seek it — not the least being that in the present political context, that policy might be the best way to restrain both costs and government.

Yes, you see the best way to restrain costs and government is to expand spending and government guarantees. I'm sure that will work perfectly.

If this all sounds familiar, it's because it is. Avik Roy, former Romney and current Rick Perry adviser, made the same case a few months ago.

Proponents of this leftward march of conservatism will point out the government was providing subsidies before ObamaCare, mainly through tax deductions for employers who provided insurance plans to workers.

That's true and it should be corrected. The trick they are now pulling is to say, we're just doing the same for people on the individual market. That's nonsense. They are talking about creating tax CREDITS, which you get whether or not you have a tax bill. This is not the government letting people keep their own money, it's giving someone elses money to another person. What is conservative about that?

The idea that a "conservative" subsidy scheme will save money and lower costs flies in the face of all experience. When the government throws a pot of money at a sector of the economy the people in that sector find ways to raise prices to eat it all up and then voters demand more subsidies to meet the higher costs (think of what loans and grants have done for college costs).

And a question for these big government conservatives....when was the last time insulating people from the actual cost of a product lead to a decrease in the use or cost of that product?

If you want to lower costs of insurance and medical services the only way to do it is make sure there are no artificial government barriers to the provision of those things and make sure that the people using them pay the actual cost. That is the only way to ensure that people make informed decisions about what they are willing to pay for something and ensure they regulate their usage of it. Everything else is a political scheme that will end of with the Democrats offering "more and for free!"

Conservatives either stand up for these basic realities or we might as well just cut to the inevitable endgame, single payer, and save the posturing.

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posted by DrewM. at 10:23 AM

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