Domestic Policy

The GOP’s No-Care Health Care Plan

The Republican approach is more about a flawed concept of federalism than about health care.

The most recent Republican stab at health care legislation exposed more clearly than ever the competing values that separate Obamacare from Republican health care proposals.

Earlier this year, I wrote about a fundamental divide between Democrats, who believe that the power of government should be used to improve people’s lives, and Republicans, who believe that the primary job of government is to create an even playing field (“Ryancare Sparks Debate Over Core Values, Not Just Health Care Policy”).

Now, Republicans seem to have abandoned even that modest belief in favor of a process-oriented approach that has little to do with either values or health care.

The value judgment at the core of Obamacare is that comprehensive, affordable health care insurance should be available to everybody regardless of gender, age or medical condition.

The essential elements of Obamacare – the employer and individual mandates, the protections for people with pre-existing conditions, and the requirement that policies cover essential health benefits – are all aimed squarely at extending affordable coverage to as many people as possible.

To be sure, Obamacare has proven to be imperfect. While it extended coverage to millions of people who previously didn’t have it, some people that already had coverage saw their premiums and deductibles rise, or were left with few if any choices for coverage. No doubt, there’s work to be done to fix Obamacare.

But the imperfections of Obamacare don’t change its underlying values. It’s not the idea of Obamacare that has proven to be problematic, it’s the implementation.

The thinking behind the Republican health care proposals is different not only in degree, but in kind. Rather than focusing on health care results, the Republican plan is built around process and political ideology.

While Republicans say that their proposals will enhance affordable coverage, they are at best neutral, if not downright hostile, to the kinds of legislative action that would be necessary to achieve that goal.

Rather, the Republican approach to health insurance is grounded primarily in their view of federalism, not health care. The belief that animates the most recent Republican proposal is that decisions on who to cover, who to subsidize, whether insurance policies must cover essential benefits, and pretty much everything else are best left to the states, not the federal government.

Accordingly, the Republican plan champions nothing with regard to the substantive elements of health care, leaving it to the states to design whatever programs they see fit. Sure, their bill on its surface purports to protect people with pre-existing conditions. But look just below the surface and you’ll see that the Republicans really leave it to each state to decide whether to allow insurance companies to decline coverage or raise prices on people with pre-existing conditions.

The states can do, or not do, pretty much whatever they want. All that really counts is that the decision is made by the states, not the federal government.

The articulated justification for this process-oriented approach is that state governments are closer to the people than the federal government, are more directly accountable to voters, and know best what solutions will work for people in their states.

That sounds fine and noble in the abstract, but it’s nothing more than an excuse for passing the buck to the states, many of whom will predictably fail to enact solutions that serve the poor and sick.

We don’t have to do much guessing about how Republican states will handle problems like covering people with pre-existing conditions. We pretty much know.

We know that most Republicans are ideologically opposed to the idea of government mandates, in health care or anything else. They see that as Big Brother, unwanted governmental interference with the free market. That’s one of the things they hate about Obamacare.

We also know what they think about requiring insurance companies to provide coverage for essential health benefits. “People should be able to buy only the insurance they want” is a frequently heard justification for getting rid of the essential health benefits requirement. But that’s nonsense. Nobody “wants” to buy inadequate insurance that doesn’t cover the very illnesses for which they most need coverage. They buy junk not because they want inadequate coverage, but because they can’t afford anything else.

Allowing insurance companies to sell stripped-down policies simply allows insurers to sell a different, lower quality product at a lower price. That’s not cost reduction. That’s junk insurance.

We also know how the states will handle pre-existing conditions because there’s a proven track record. We know what they did before Obamacare.

Prior to Obamacare, it was up to the individual states to decide whether insurance companies had to cover pre-existing conditions. According to a study by the Kaiser Foundation, 45 states permitted “medical underwriting” in the individual insurance market (“Pre-existing Conditions and Medical Underwriting in the Individual Insurance Market Prior to the ACA”).

“Medical underwriting” means that insurance companies were permitted to obtain detailed health and risk information from applicants. Based on that information, they could decline coverage altogether, double (or more) premiums, increase deductibles, or sell a policy that excluded coverage for the pre-existing condition.

According to Kaiser, approximately 18% of applicants were denied coverage due to pre-existing conditions prior to Obamacare, but that underestimates the number of people affected because it doesn’t include the many people who never bothered to apply for coverage because they knew it would be declined.

Declinable conditions included a massive laundry list of things such as expected pregnancy, arthritis, alcohol abuse, mental disease, cancer, and dozens more. Denial rates in states like Kentucky, North Carolina and Ohio were as high as 33%.

It’s theoretically possible that the states are now more enlightened, caring, and willing to spend tax revenues on the neediest among them than they were prior to Obamacare.

But don’t bet on it.

At the end of the day, even if it were true that the states know best what their voters want, that wouldn’t necessarily mean that what they want is affordable health care for all. At least it’s probably not what they want most, and we know that in the real world there are some things people want more than others, especially when it comes to collecting and allocating tax dollars.

Who’s to say that people in red and purple states don’t want their local governments to give them tax relief far more than they want them to spend their hard-earned tax dollars on medical care for people they regard as morally undeserving parasites (“takers” in the Republican vocabulary), or just “not me.”

And even if all 50 states were inclined to establish truly humane health care systems, many of them can’t, or won’t. Some are close to bankruptcy. Others lack the infrastructure. Others lack the political will, know-how or tools to make it happen. And some are simply too small to establish insurance pools large enough to even out the disparate needs of diverse populations.

Too many Republicans seem to think that “federalism” always means “leave it to the states.”

It doesn’t. National problems require national solutions.

Health care is a national problem. Whether the answer is to fix Obamacare, establish a single payer system, or something else, it certainly isn’t the Republican plan to return the health care insurance market to its pre-Obamacare state of nature.

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