Having stumbled time and time again, Republicans need a new approach to health care.
IT MADE for high drama on the Senate floor when Arizona Senator John McCain derailed the Republican quest to “repeal and replace” the Affordable Care Act (A.C.A.) with one fateful thumbs down. With help from Senators Lisa Murkowski of Alaska and Susan Collins of Maine, Mr. McCain blocked Senate Republicans from passing their so-called “skinny repeal” bill—a questionable policy with a truly terrible name.
Senate Majority Leader Mitch McConnell, widely praised for his legislative dexterity, had concocted a master plan. After barely squeaking by to open debate on a health bill—with Mr. McCain being the decisive fiftieth vote no less—Mr. McConnell first put up his most comprehensive A.C.A. reform plan, the Better Care Reconciliation Act (B.C.R.A.), about which we have written extensively.
When the B.C.R.A. flopped with only 43 votes, Mr. McConnell veered to the right, opening up a new vote on “repeal and delay,” which would abrogate Obamacare (another name for the A.C.A.) with a two-year delay period. Ostensibly, this would motivate senators from across the aisle to join together in a kumbaya of bipartisan policy-making triumph—or else, at the end of the delay period millions of dispossessed voters might just find themselves without health insurance.
The repeal and delay strategy was irresponsibly risky from the get-go, and as such, many Republicans balked at the scheme; the bill failed.
Mr. McConnell’s third and final gambit was the aforementioned skinny repeal bill, officially called the Health Care Freedom Act. This eight-page bill was proposed in the evening and was scuttled by Mr. McCain by dusk. Republicans were left with no further bills to propose—and no legislative strategy to speak of.
Liberal publications cheered; conservative ones lamented the Republicans’ internecine squabbling. To some degree, both reactions are merited. All of the bills peddled so furiously by Mr. McConnell were poor policy and worse politics. The B.C.R.A., for instance, involved catastrophic trade-offs: swapping significant amounts of Medicaid funding and health-insurance subsidies for capital gains tax cuts. Yet Republican leadership’s desire to bolt ahead with health-care reform without abiding by conventional lawmaking procedure was born of intra-party disagreement and an ambitious legislative docket which relied far too much on procedural gimmicks.
Having faltered, Republicans must now balance a difficult tightrope. Should they give up on health care and move onto tax reform? Is it simply a matter of tweaking the skinny repeal provision and voting once more? Or perhaps must they succumb and negotiate with Democrats?
Vis-à-vis the third option, negotiating with Democrats, Republicans are understandably wary of the steep demands Minority Leader Chuck Schumer might make in order to garner support from his caucus for any Republican health-care measure. With that in mind, bipartisan compromise remains the best way to both salvage Republicans’ 2018 prospects and pass good health-care policy. Mr. McConnell should approach the negotiations with three objectives.
First, Mr. McConnell must insist the “individual mandate” is done away with—and replaced. Doing so is the only way to credibly claim political victory with Republican constituents; anything less would cause claims of “repeal and replace” to ring hollow. Mr. Schumer would likely require that the mandate be replaced with an equivalent measure. To explain, the individual mandate draws healthy people into the Obamacare health-insurance marketplaces, or “exchanges,” by levying a fine on any who lack health insurance. This keeps overall risk in the exchanges balanced, thus keeping prices down.
An auto-enroll provision, which places anyone over 26 into a low-cost health-insurance plan from which they may opt out, would have a similar effect. A large body of evidence has demonstrated the efficacy of auto-enrolling people into 401(k) plans, and many health policy experts have argued the same provision could be a successful substitute for the individual mandate, which conservatives decry as too coercive.
Second, Mr. McConnell must bend to Mr. Schumer’s highly probable demand that Medicaid cuts be taken off the table. Otherwise, there is no conceivable path for any sort of bipartisan agreement. This might result in defection from those on the hard-right of the Republican Party, like Kentucky Senator Rand Paul, who view thorough health-entitlement reform (e.g. cuts to Medicaid) as a prerequisite for voting on a health bill. Their votes, however, will prove too difficult to secure, and Mr. McConnell would do better focusing his efforts on building a robust left-right coalition.
Third, Mr. McConnell must codify “cost-sharing subsidies” to prevent the executive from undermining the exchanges. These subsidies are given by the federal government to health-insurance companies to keep out-of-pocket costs down for low-income Americans. A lawsuit by House Republicans against the Obama administration is awaiting appeal; until then, it is the prerogative of the mercurial Donald Trump to continually renew payments for the subsidies. In the face of such ambiguity, insurers have been perturbed and may be forced to hedge their risks and preemptively raise premiums for Obamacare plans starting in 2018. By writing the money for these subsidies into law, Mr. McConnell would take a huge, important step toward stabilizing the exchanges and stopping the capricious White House from wreaking havoc. It would also have the knock-on effect of pleasing Democrats, which could boost Mr. McConnell’s chances in any later negotiations.
The specifics of any health-care compromise would hinge on the particular demands of each side, which are as of yet unclear. But the outlined framework would allow Mr. McConnell to take a positive step toward reforming Obamacare on the margins in a bipartisan manner.
However, as much as the A.C.A. needs it, marginal tinkering alone is not enough. In the long run, the health-care system needs a full revamp, including streamlining Medicare and Medicaid and nixing the tax loophole for employer-sponsored health insurance. Conservatives have good ideas on health care. But since Republicans have proven themselves unable to dream up judicious conservative proposals, macroscopic health-care reform will have to wait.
