The Takeaway: The Republican Health Care Bait and Switch
The classic “bait and switch” in the world of retail sales is to entice people with an offer of something good and then switch them to something of either inferior quality, higher price or both. This is a perfect description of the health policy changes the incoming Trump administration and Republican congressional leadership are trying to foist on the American people. The setup for this strategy is to point to a real problem – in this case, deductibles and out-of-pocket costs, which are indeed too high for many households. High out-of-pocket costs impose a hardship on moderate income families, especially for people with chronic conditions, and also undermine the perceived value proposition of purchasing health insurance. Healthy people are less likely to buy insurance if deductibles are too high to make their anticipated health care needs more affordable overall.
To deal with that problem, Republicans are promising something better than the ACA – “something “terrific” (i.e., the “bait”), but they have remained opaque with respect to what that “something” might be or when it will appear. The reason may be that the plans they have floated so far would make out-of-pocket costs higher, not lower (i.e., “the switch”). But many Republicans, especially in the Senate, are starting to worry that people are not falling for the scam. This is leading to further obfuscation about the timing and content of a replacement plan and has even led some commentators to assert that the original “repeal and delay” strategy is dead.
Unfortunately, reports of the demise of repeal and delay – or “repeal and run” as Sen. Elizabeth Warren termed it at a health care rally in Boston over the weekend – are premature. The Senate and House have both set repeal in motion with their votes last week, but replace is nowhere on the horizon.
Is Replace Even Possible?
It’s not at all clear that Republicans will ever be able to coalesce around a plan among themselves, let alone one that can attract enough Democrats to put it over the top in the Senate with the required 60 votes. New York Times columnist Paul Krugman offers a metaphorical policy explanation for why replace remains so elusive. He suggests that the “three legs” of the ACA “stool” – elimination of pre-existing conditions, the individual mandate and tax credits – are indivisible. If you take away any of the three, the stool will collapse. While there is something to this framing, all three of these “legs” could, in theory, be tinkered with rather than lopped off, and the stool relabeled “Trumpcare.” (For example, the individual mandate could be converted to a late-enrollment penalty like the one used in Medicare.)
The heart of the Republicans’ problem is even more fundamental and is laid out clearly by Jonathan Chait in New York Magazine. It’s worth quoting directly: “Giving people the better coverage they promised, or even minimally acceptable coverage, requires providing resources and there’s no way that’s ideologically acceptable to conjure those resources, which is why the unified Republican plan has been stuck in the almost-there stage since 2009.”
In other words, Republicans can’t have both their tax cuts for the rich and their “terrific” health plan, too. This fact was acknowledged by Sen. Bob Corker last week, but does not seem to have broken through to President elect Trump, who made a surprise “announcement” over the weekend that his health plan covering everybody and with much lower deductibles than the ACA, was almost ready (an announcement that couldn’t possibly have had anything to do with wanting to divert some attention in the news cycle on a day when tens of thousands of people in communities across the country were rallying to protect health care coverage.) Of course, there were no details provided.
It will be interesting to see what Trump’s new plan is (cross-state sale of health insurance?), if it ever actually materializes. But unless there is adequate funding, the mirage of an acceptable replacement plan will promptly dissolve. And juxtaposed against mammoth tax cuts for the wealthiest households, like the ones in the 2015 repeal bill passed by Congress and vetoed by President Obama, skimpy subsidies and even skimpier coverage will look miserly indeed. It’s hard to say at this point whether there are a few Republican senators with both the good sense and the political will to resist the looming disaster of ACA repeal – a disaster that will fall heavily on the many rural communities that voted for Donald Trump. But if not, there is every reason to expect that “Trumpcare” will become the new “Hooverville” – a lasting symbol of government indifference and malfeasance, as well as an enormous political liability for the GOP.
Honoring Dr. King
Martin Luther King Jr. said, “Of all the forms of inequality, injustice in health care is the most shocking and inhumane.” It’s therefore more than a shame that instead of press coverage of a major new report on how communities can attack health disparities, released by the National Academies of Medicine Science and Engineering, the major news outlets were focused on attacks on a hero of the civil rights movement by the president-elect. Tackling the persistent health disparities that plague our country would be a truly fitting tribute to Dr. King. Instead we are faced with the threat of policies that would make disparities far worse, including not only the rollback of the ACA, but threats to the core Medicaid program that covers millions of low-income children, seniors and people with disabilities. We can honor Dr. King and the thousands of activists of the civil rights movement by drawing inspiration from their activism and resistance as we confront an existential threat to the health and economic security of millions of people in our country.