ACA Repeal and the Ethics of Belief

An elderly patient presents to a physician with symptoms of pneumonia. The physician ignores accepted medical standards of care and chooses to believe the patient suffers from a cold or flu. The patient dies of pneumonia. What evidence informs our beliefs, or how we arrive at our beliefs, is as important as what they are.

In 1877 a Cambridge mathematician and philosopher, William Kingdon Clifford, published an essay titled, “The Ethics of Belief.” 1 In it, Clifford imagined a ship owner “about to send to sea an emigrant ship” that he knew “was old, and not overwell built at the first.” Knowing the ship had possibly become unseaworthy, he realized he ought he to have “her thoroughly overhauled and refitted.” Despite this knowledge, the ship owner succeeds in convincing himself that since the ship had “gone safely through so many voyages and weathered so many storms” it would do so again. If the ship goes “down in mid-ocean and told no tales” what, Clifford asked, shall we say of the owner? “Surely this, that he was verily guilty of the death of those men.” Though the ship owner may have come to believe in the soundness of his ship, “the sincerity of his conviction can in no wise help him,” because the owner, “had no right to believe on such evidence was before him.” “He had acquired his belief not by honestly earning it in patient investigation,” but by “stifling his doubts.”

Suppose, however, the ship did prove to be seaworthy would that, Clifford asked, “diminish the guilt of the owner?” “Not one jot,” Clifford concluded. “When an action is once done it is right or wrong for ever.” “The man would not have been innocent, he would only have been not found out.” “The question of right or wrong has to do with the origin of his belief, not the matter of it, not what it was, but how he got it; not whether it turned out to be true of false, but whether he had a right to believe such evidence was before him.” Clifford sums up his argument by stating, “it is wrong always, everywhere, and for anyone, to believe anything upon insufficient evidence.”

Clifford’s essay became a seminal work in the field of ethics because he posed a central question in life. Is it ethically wrong to believe something based on insufficient evidence? Is it wrong to oppose or support repeal of the Affordable Care Act (ACA) absent “patient investigation” or based on “insufficient evidence”? Are those, like the ship owner, then responsible for any and all adverse consequences resulting from repeal?

Republican condemnation of the ACA is well documented. For President Trump the ACA represents an “incredible economic burden.” Senate Majority Leader Mitch McConnell termed it a “monstrosity,” a “disaster,” and a “huge mistake.” House Speaker Paul Ryan stated the ACA is “really hurting families.” Representative Tom Price, the Department of Health and Human Services Secretary nominee, said it’s “unsuccessful, unworkable and unaffordable” and Housing Secretary nominee, Dr. Ben Carson, infamously stated Obamacare is the worst thing that has happened in this country since slavery. Apart from the demagoguing or the “rhetoric of reaction,” to quote Albert Hirschman, what actual evidence informs Republican repeal beliefs?

First and foremost, Republicans do not believe in the individual mandate. Among at least nine Republican proposed alternative plans not one includes a mandate to purchase coverage. 2 Republicans as far back as Nixon, have supported an individual and employer mandate largely because it addresses the unavoidable free rider problem. The mandate’s purpose, and the reason for health or any other insurance program, is to pool risk. Health insurance only works when a significant percent of the those healthy buy the product. This is because the roughly 50 percent of those insured that consume five percent of health care resources make insurance affordable for the five percent that consume 50 percent. The primary reason why some state insurance marketplaces have been unstable to date is because an inadequate number of 18-to-30 year olds have purchased polices. Not surprisingly mandates are included in Romneycare. Recognizing this fact is why Republican alternatives, for example, Representative Tom Price’s plan, proposes a provision that’s indistinguishable from the individual mandate. 3 Termed “continuous coverage,” the provision similarly incents coverage. If an individual drops or has a gap in coverage, under Price’s plan an insurer could impose a preexisting condition exclusion for up to 18 months. Though Republicans say they prize individual autonomy, their problem with the mandate, particularly those that support auto enrollment, appears to be that it’s not coercive enough.

Republicans believe the ACA’s essential health benefits provision is overly burdensome and/or unnecessary since it requires insurers to provide 10 essential health benefits increases premiums. They argue insurers be given the flexibility to offer plans with less coverage or plans that have an actuarial value of some amount less than 60 percent, the actuarial value of marketplace bronze plans. Offering plans that questionably protect individuals or families from high-cost or catastrophic medical events is however why the Congressional Budget Office (CBO) in December stated that if “there were no clear definition of what type of insurance product people could use their tax credit to purchase,” because “some states might not impose any regulations that would govern the depth and extent of coverage,” then “CBO and JCT would not count those people with limited health benefits as having coverage.” 4

Republicans desire to repeal ACA subsidies or tax credits, up to 400 percent of the federal poverty level, to buy marketplace plans – as well as the taxes that fund these subsidies. Senator Hatch’s plan and Avik Roy’s would though provide subsidies up to 300 percent. The Republican Study Committee’s plan would allow for a standard income and payroll tax deduction of $7,500 for individuals and $20,000 for families and Representative Tom Price’s plan, that calls for total ACA repeal, even allows for between $1,200 and $3,000 in tax credits. All comparatively far less generous (or regressive) but not believed to be unnecessary. Republicans also have objected to insurer subsidizes, specifically the ACA’s risk corridor program that’s designed to both encourage and protect insurers covering newly insured lives with unknown risk profiles and utilization histories. Despite being modeled after Republican-led Medicare Part D legislation, Republicans termed this policy an insurance bailout and in 2014 prohibited CMS from paying out over $2 billion in risk corridor payments to insurers. 5 This single action likely did more than anything to destabilize insurer participation in 2014 and 2015. The limited number of insurer participation in some state marketplaces, due to undermining the risk corridor program and the consequential increases in premiums, has led Republicans to believe the marketplaces are in “death spiral.” This runs counter to the evidence that regardless of premium costs benchmark plan contributions are capped for the individual, enrollment has grown every year and the average enrollee is healthier, that is per-member-per-month spending fell between 2014 and 2015. 6

An individual mandate, essential benefits, guaranteed issue, insurer protections and subsidies are inter-related policies that create a functioning insurance market. With no mandate, premium increase requiring even greater subsidies. Absent these, market instability is a known fact. To no one’s surprise the CBO recently concluded that if signed into law the Republican’s 2015 reconciliation bill (HR 3762), vetoed by President Obama in January 2016, “would,” CBO stated, “increase the number of people without health insurance coverage—relative to current-law projections—by about 22 million people in most years after 2017.” 7 This is because, as the Urban Institute pointed out in a December report, based on pre-ACA efforts, implementing guarantee issue and community rating in non-group markets without also providing for an individual mandate or financial subsidies causes market failure. 8

Though 16 states with Republican governors have expanded Medicaid coverage under the ACA, many Congressional Republicans desire to repeal Medicaid’s expansion that has, to date, extended coverage to 13 million poor Americans even with non-participation by 19 states. This is because, according to Paul Ryan’s “A Better Way” document, the program suffers, in part, from significant fraud and abuse due to “state oversight failures.” 9 Republicans believe instead of expanding coverage, the federal government at least unwind expansion by either block granting moneys to the states or provide them with per capita caps. The justification for this is state states, per Ryan, “know better than Washington bureaucrats where there are unmet needs to cut down on waste, fraud and abuse.” Leaving aside how providing no-strings-attached block grants helps reduce state fraud, the Urban Institute estimates repealing Medicaid expansion would under a Republican reconciliation bill, completely unwind progress made under the ACA. 10 Though there’s general agreement the Medicaid program can be improved, that states need relief from federal oversight is largely a solution in search of a problem. States already have wide discretion in how they cover their low income population, for example, in how they establish financial eligibility criteria, how low-income pregnant women and children are covered, states can apply for 1115 waivers that allows for even more flexibility in extending coverage to other population groups including higher-income individuals and states can choose to cover the medically needy despite higher incomes. Somehow, Republicans believe dramatically reducing Medicaid funding is “a better way” to address, among other problems Ryan identifies, patient access and patient safety.

Instead of adequately subsidizing a guaranteed insurance product that meets minimum coverage criteria and is among other things without lifetime coverage caps and that can be purchased in an organized market, Republicans believe individuals and families would be better served by having them shop in an unorganized market aided by measurably less generous subsidies. That they be offered expanded Health Savings Accounts (HSAs), opportunity to participate in state high risk pools and that insurer’s be allowed to sell plans across state lines. These beliefs are also unfounded. The track record on high risk pools, even the ACA’s temporary Pre-Existing Condition Insurance Plan (PCIP), is poor. Risk pools are typically underfunded, as Representative Price’s proposal would be, and since coverage is both expensive and limited, under-enrollment is substantial. 11 HSAs are designed to help high income individuals which is why the vast majority of HSA accounts are held by households with income over $100,000. Stated another way, HSAs are meaningless to an individual or family that has no excess income. Allowing the sale of insurance across state lines in an effort to increase competition is already enabled by the ACA via state compacts. Plans are entirely indifferent to these because a plan in state A cannot adequately leverage providers in state B without a pent up consumer demand. 12 These alternatives are slogans, not policies.

Despite being unable to propose a comparable ACA alternative over the past seven years, Republicans appear fixed in their belief they’ve evidence to justify repealing a law that, beyond insuring more than 20 million more Americans, has slowed both health care price growth and spending growth, in part by reducing out of pocket Medicare Part D spending by $5 billion annually, and lowered premiums. National health expenditures for the first decade of the ACA have been projected to be $2.6 trillion lower than pre-ACA projections. That’s to say gains achieved under the ACA have been free. 13 Beyond improved individual and family financial security, the law has also reduced income inequality and health care disparities and has improved health care quality by, among other things, lowering hospital-acquired conditions and hospital readmissions.

The evidence for ACA’s repeal amounts to dissembling. It begs belief. What do we make of politicians seeking to overturn the ACA? “The existence of a belief not founded on fair inquiry, William Clifford argued, “unfits a man for the performance of . . . [his] duty.” “Every time we let ourselves believe for unworthy reasons” or “believe anything on insufficient evidence,” one is left, Clifford wrote, unable to avoid doing “great wrong towards Man.” “The danger to society is not merely that it should believe wrong things, . . . but that it should become credulous, and lose the habit of testing things and inquiring into them; for then it must sink back into savagery.”

1. William K. Clifford, “The Ethics of Belief,” was originally published in Contemporary Review. His work would become the locus classicus of the ethics of belief debate. See, for example, the Stanford Encyclopedia of Philosophy’s 23-page summary of the “ethics of belief” at: https://plato.stanford.edu/entries/ethics-belief/. Clifford’s essay is available at: http://www.davidjamesbar.net/wp-content/uploads/2016/03/Clifford-The-Ethics-of-Belief.pdf. For a review of Clifford’s work see, for example, Timothy J. Madigan, W. K. Clifford and “The Ethics of Belief,” Cambridge Scholars Publishing, 2009.
2. Among other Republican plans is Senator Hatch’s “Patient CARE Act,” Rep. Tom Price’s “Empowering Patients First Act,” Senator Cruz’s “Health Care Choice Act,” the American Enterprise Institute’s “Improving Health and Health Care: An Agenda for Reform,” President-elect Donald Trump’s “Government for People Again,” Avik Roy’s “Transcending Obamacare,” the Heritage Foundation’s “A Fresh Start for Health Care Reform,” and the Republican Study Committee’s “American Health Care Reform Act.”
3. A summary of Rep. Price’s plan is at: http://kff.org/health-reform/issue-brief/proposals-to-replace-the-affordable-care-act/?utm_campaign=KFF-2017-The-Latest&utm_source=hs_email&utm_medium=email&utm_content=40900997&_hsenc=p2ANqtz-8CFPowK7wF4mkfz3We0fhKd9TDgRHIWHqjeF9GPUr1xmfz82AwCcnyq_0xdX4ZBvmiJoiznHQB9MBG9FDKiuTuBBkJAg&_hsmi=40900997.
4. Susan Yeh Beyer and Jared Maeda, “Challenges in Estimating the Number of People With Nongroup Health Insurance Coverage Under Proposals for Refundable Tax Credits,” Congressional Budget Office Blog (December 20, 2016), at: https://www.cbo.gov/publication/52351.
5. See, for example, Nicholas Bagley, “Trouble on the Exchanges – Does the United States Owe Billions to Health Insurers?” The New England Journal of Medicine (November 24, 2016), at: http://www.nejm.org/doi/full/10.1056/NEJMp1612486?af=R&rss=currentIssue#t=article.
6. The White House, “The Economic Record of the Obama Administration, Reforming the Health Care System,” (December 2016), at: https://www.whitehouse.gov/sites/default/files/page/files/20161213_cea_record_healh_care_reform.pdf7. Congressional Budget Office, “How Repealing Portions of the Affordable Care Act Would Affect Health Insurance Coverage and Premiums,” (January 17, 2017), at: https://www.cbo.gov/publication/52371.
8. Linda J. Blumberg, et al., “Implications of Partial Repeal of the ACA Through Reconciliation,” Urban Institute (December 2016), at: http://www.urban.org/research/publication/implications-partial-repeal-aca-through-reconciliation.
9. “A Better Way, Our Vision for a Confident America,” (June 22, 2016), at: https://abetterway.speaker.gov/_assets/pdf/AbetterWay-HealthCare-PolicyPaper.pdf.
10. See note 8.
11. See note 3 and Jean P. Hall, “Why a National High-Risk Insurance Pool Is Not a Workable Alternative to the Marketplace,” The Commonwealth Fund (December 2014), at: http://www.commonwealthfund.org/publications/issue-briefs/2014/dec/national-high-risk-insurance-pool.
12. See, for example, Michael Hiltzik,”Selling Health Insurance Across State Lines is a Favorite GOP “Reform. Here’s Why It Makes No Sense,” The Los Angeles Times (November 14, 2016), at: http://www.latimes.com/business/hiltzik/la-fi-hiltzik-insurance-state-lines-20161114-story.html.
13. Sherry Glied, “The Costs and Benefits of Health Care Spending in 2015,” Health Affairs Blog (December 13, 2016), at: http://healthaffairs.org/blog/2016/12/13/the-costs-and-benefits-of-health-spending-in-2015/.

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4 replies »

  1. “ Health insurance only works when a significant percent of the those healthy buy the product.”

    That isn’t true. People buy insurance of all types voluntarily, but one of the problems with health insurance is that many people perceive it to be a bad investment and for the most part they are right.

    “The primary reason why some state insurance marketplaces have been unstable to date is because an inadequate number of 18-to-30 year olds have purchased polices.”

    The instability is due to the fact that some are buying insurance in part paid for by others in the pool. When those others find they are being ripped off they no longer want to be in the pool.

    Some of your complaints about Republicans who I do not wish to protect are precisely theflaws in the ACA and part of the reason the ACA failed. That failure was predicted long before the bill was passed and the reasons it would fail were also presented way before the bill was passed.

    I’ll stop here for I fear more of the same blame game rather than rational discussion of what actually happened and what needs to be done. The ethics discussion at the beginning was great, but didn’t really pertain to the discussion.

  2. Thanks for putting all of this together into one post. In particular, the Medicaid block grant thing has always puzzled me. There ensile much to stop states from experimenting now, or the last 30 years. They don’t. The idea that the states have less waste , fraud and abuse is nonsense. That said, I really have no problem of having a trial to see if some states could actually do things better.

  3. Many thanks for the thoughtful analysis, especially its ethical bias. I would add two other ethical measures. First, a theme of ‘beneficence’ should prevail along with its corollary, ‘do no harm.’ Second, a national proposal for the economic support of healthcare can lose track of the community driven conditions that drive the ultimate expression of each citizen’s ‘HEALTH’ for their ‘autonomy.’ A means to promote the attributes of ‘caring relationships’ for the healthcare of each citizen, as shaped by the ‘common good’ of each citizen’s community, must accompany our nation’s universal health insurance institutions. Ultimately, any over-all risk management structure for the distribution of economic responsibility must begin with a focus on the resiliency of its Primary Healthcare AND its locally applied ‘social capital’ for the ‘common good’ within each community for the ‘autonomy’ of each citizen.
    For example, the occurrence of disasters for a specific community are generally knowable. The timing of their occurrence and level of devastation are generally NOT specifically predictable. But, the ability to mitigate the impact of a disaster for a community’s citizens is knowable and can be arranged in advance. So, what is the community by community, nationally promoted basis for integrating each community’s needs with regional and national disaster preparedness? Well, its probably not very good. But, year after year, disasters occur. Most importantly, how does the lack of uniform preparedness interfere with out capacity to manage the disasters that are NOT predictable……….AND their cost? For each community, ‘beneficence’ and ‘autonomy’ apply. Healthcare Reform without a co-occurring strategy of decentralized governance will do very little to achieve equitably available, ecologically accessible, justly efficient and reliably effective healthcare for each citizen.

  4. I think we should minimize forcing people. We have to do enough of this with taxes and military service. I don’t have to list the forcings in the ACA. Even telling people what benefits they are to receive in their Plan is astonishing when you think a bit. How does this have anything to do with government?

    For some reason, you believe we have to run this like an insurance business. We don’t run the military like a business. We don’t run the border patrol like a business. We don’t run the Congress like a business.

    Health care can be a public good. And there need be no need to worry about adverse selection within insurance pools. The management of risk is accomplished by taxing the public. If you run it like this, you are happy that a few of the young and healthy invincibles do not want insurance–it saves you money.

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