It’s no secret that our nation’s economy is struggling, and the president’s health care law, enacted in 2010, is making things worse — raising health costs and making it harder for small businesses to hire workers. The only way to change this is by repealing ObamaCare in its entirety.
There has been much renewed media focus on the president’s health care law in recent months because the U.S. Supreme Court is expected to rule in June on the question of whether the law is constitutional. But the American people have never lost their focus on it. They didn’t like the law when it was rammed through Congress by President Obama and a Democratic majority in 2010, and according to most public opinion surveys, they like it even less now.
It’s not difficult to understand why most Americans remain opposed to ObamaCare. Many question its constitutionality; I’m certainly one of them. But the law’s negative impact on Americans’ daily lives is what I hear about the most.
Americans are dealing every day with the tough realities of life in the Obama economy. They’re facing rising prices for food, gas, college tuition and health care. Many are out of work. And among those fortunate enough to have jobs, many are struggling to keep them. Couple this with the ever-present specter of higher taxes — which are constantly being threatened by the president and his advisors — and the possibility of another downgrade in our nation’s credit rating as a consequence of the national debt that has exploded under the president’s spending policies, and it’s a pretty grim picture. If you’re reading this, you know exactly what I mean.
The Supreme Court’s decision on the constitutionality of the Affordable Care Act (ACA) will likely be handed down on the last day of this year’s term. If the Court finds that the ACA—either in whole or in part—violates the Constitution, the health care industry will be shaken to its core. And, no matter what legal justification the Court uses to invalidate the ACA, the structure of constitutional law will be severely undercut. The resulting medical and legal chaos will be expensive, divisive, and completely unnecessary. Nothing in the text, history or structure of the Constitution warrants the Court overturning Congress’s effort to address our national health care problems.
For the health care industry, a decision striking down the entire ACA would be an absolute disaster. Physicians, hospitals, and private companies have been shifting how they practice medicine in anticipation of the ACA’s implementation. They’ve been creating accountable care organizations, envisioning a significant reduction in uncompensated care, and enjoying increased Medicare and Medicaid reimbursement in primary care settings. That will all vanish if the ACA is struck down. Moreover, seniors will pay more for prescription drugs and young adults will be taken off their parents’ insurance. The private insurance industry, which has seen its market shrink significantly over the last decade, will see a real chance to reverse that trend disappear. According to one estimate, if the ACA is overturned, insurers may lose over $1 trillion in revenues between 2013 and 2020.
“How can the government make us buy health insurance? What gives them that right?”
Sitting on my left while our airplane raced above the clouds, Elizabeth was clearly upset about Obamacare. She wondered why the bill had to be so long, and why Obama would endorse a plan that doubled her health insurance costs. But nothing vexed her more than the individual mandate.
At least that’s what I though until I spoke with her at greater length, and she revealed a profound truth to me about people’s attitudes towards the mandate and towards Obamacare more generally: she showed me that deep down she liked the idea of the mandate, once she realized its important role in accomplishing goals people on all sides of the political spectrum care about deeply.
We were flying towards North Carolina the day before the Supreme Court held its oral arguments on Obama’s healthcare plan. Elizabeth had heard a great deal about the mandate. She read The Wall Street Journal regularly, in part because it was so relevant to her work in banking. And she enjoyed watching Bill O’Reilly on Fox News, but not Hannity, who she thought was “too extreme”. She was by no means a conservative extremist. She had major concerns about the banking industry for example, and as a Christian felt strongly that income inequality is a moral problem that neither party was addressing in an effective manner. But she was solidly Republican, no doubt about that, and she agreed with most people in that political party that Obamacare was hurting the economy. And above all she believed the health insurance mandate was “un-American.”
As the U.S. Supreme Court deliberates the Obama healthcare law, the court itself is on trial.
Obamacare supporters are attacking the justices as “hacks dressed up in black robes,” calling for limits on their life tenure, and claiming judicial review is undemocratic.
Worse, President Obama and his Secretary of Health and Human Services Kathleen Sebelius are shoveling money into implementing the law as fast as possible and refuse to discuss an alternative. That’s irresponsible. What’s needed now is not court bashing but contingency planning.
The Obama administration and allies in Congress have nine weeks to plan how to pick up the pieces on a vast array of health insurance issues. It’s the President’s duty to have a plan. It will signal his respect for the nation’s system of checks and balances — something he has utterly failed to show.
Before long the Supreme Court is expected to rule on the health care reform law, a decision that will have tremendous policy ramifications and could reshape the presidential election.
But even if the court overturns the Affordable Care Act, as some observers predict, that won’t change the reality that our country’s health care system is seriously broken. In short, regardless of what the court says, people will still be getting sick, costs will keep rising and too many people will be uninsured. And our federal budget will never be sustainable if we can’t bring health care costs under control.
The Democratic Party and progressives invested a huge amount of political capital in getting Congress to pass the ACA in 2010. The act was not perfect, but it did provide a start to the many years of work needed to create a sustainable health care system. In speeches, Republicans and conservatives acknowledge that our health care system is unsustainable and have spoken of a need to “replace”; however, in the two years since the ACA passed, they have failed to be clear about what they actually favor.
As we look to what we’re actually going to do about the problem, what’s clear is that progressives and conservatives both need to move beyond their familiar positions to find a new kind of deal. This seems politically impossible before November, but politicians on both sides would do themselves – and the country – a big favor if they quietly started devising a solution that everyone can live with, even if neither side gets everything it wants.
For progressives, universal coverage has always been the Holy Grail and dream deferred, not just of health policy, but of all social policy. I don’t think conservatives have a health policy interest that is so clear and heartfelt as universal coverage is for progressives, but if I had to take a stab, I think it is their belief that people don’t have enough “skin in the game” and are therefore wasteful of other people’s money.
Well, the future of American health care is now controlled by lawyers. That may not be news – doctors, drug makers, and medical-device makers have long complained about the cost of lawsuits. But this different: The future of PPACA is in the hands of the Supreme Court. Hundreds of lawyers billed thousands of hours analyzing and preparing briefs for the case. And that’s after countless hours spent by Congressional staff lawyers putting the bill together in 2009 and 2010. The result? A “law” so confusing that even the legislators – themselves mostly lawyers – could not bother to even try to read it.
It makes one think: If the lawyers are designing the health-care system, shouldn’t they be forced to operate under regulations similar to those they’re imposing? How, for example, do lawyers get paid? Today, they negotiate fees with clients. That hardly seems fair. In health care, doctors don’t negotiate fees with patients, they get paid according to an opaque schedule determined by health plans. Lawyers should do the same. The solution is “legal insurance”. After all, who amongst us knows when we’ll need a lawyer? It is often an unpredictable expense, and yet the “market” seems to have failed to provide such insurance. Government must intervene.
Last week, I wrote an article describing several purchase mandates adopted by the framers in early Congresses, including two medical insurance mandates imposed on shipowners and seamen. These examples rebut the claim by challengers to Obamacare that purchase mandates are wholly unprecedented in a way that allows us to infer they are unconstitutional, a claim on which they rely heavily because there is no text, history, or case law that affirmatively supports a ban on purchase mandates.
Not everyone agrees with me. Some comments to my article, here and elsewhere, have suggested that these early medical mandates are distinguishable from Obamacare because they reflect Congress’ power to enact maritime law, not its power to regulate commerce. But the Constitution’s list of congressional powers nowhere includes a maritime law clause. Early Supreme Court cases all held that the Commerce Clause was what gives Congress the power to enact maritime law. For example, in The Daniel Ball, a case decided in 1871, the Court stated that navigable waters form “a continued highway for commerce, both with other States and with foreign countries, and is thus brought under the direct control of Congress in the exercise of its commercial power. That power authorizes all appropriate legislation for the protection or advancement of either interstate or foreign commerce…” In The Lottawanna, the Court held that it was under this commerce clause power that Congress had enacted statutes that determined “the rights and duties of seamen” and “the limitations of the responsibility of shipowners.” These early medical mandates were thus enacted under the very Commerce Clause at issue in the Obamacare case.
Two weeks ago, the Supreme Court heard arguments on the constitutionality of the administration’s health law, aka ObamaCare. Opponents are giddy with the possibility that the law might be struck down.
But what then? Millions of uninsured, both those who choose not to purchase coverage and those who can’t due to pre-existing conditions, will still be with us. The rising costs and inefficient delivery of health care will still be with us.
The country can have a vibrant market for individual health insurance. Insurance proper is what pays for unplanned large expenses, not for regular, predictable expenses. Insurance policies should be “guaranteed renewable”: The policy should include a right to purchase insurance in the future, no matter if you get sick. And insurance should follow you from job to job, and if you move across state lines.
Why don’t we have such markets? Because the government has regulated them out of existence.
Most pathologies in the current system are creatures of previous laws and regulations. Solicitor General Donald Verrilli explained as much in his opening statement to the Supreme Court: “The individual market does not provide affordable health insurance,” he noted, “because the multibillion dollar subsidies that are available” for the “employer market are not available in the individual market.”
Start with the tax deduction employers can take for their contributions to group health-insurance policies—but which they cannot take for making contributions to employees for individual, portable insurance policies. This is why you have insurance only so long as you stay with one employer, and why you face pre-existing conditions exclusions if you change jobs.
As the Supreme Court debates the boundaries of government’s role in mandating the purchase of insurance, the discussion continues on whether the public or private sector is best positioned to drive market reforms necessary to meet our goals of lower costs and higher quality. As the son of a Phi Beta Kappa neo con who believes government should be the size of a sand gnat and as the husband to a British citizen who loves national healthcare and was born through a midwife, I often find myself lost in a political no man’s land with volleys being exchanged from the right and left. To complicate Thanksgiving dinner further, thirty years of healthcare consulting, including a three-year stint in Europe, hospitalization for pneumonia in the NHS and a tour of duty as a senior executive for a national insurer has left me with my own conflicted convictions about how we might fix our broken system.
On the eve of the Supreme Court determining the fate of PPACA, strong opinions are in full bloom like cherry blossoms along the Mall. In his particularly sharp remarks to government attorneys, Justice Kennedy, considered a swing vote by many, cautioned that Congressional intervention to mandate citizens the “duty ( to buy coverage) to act “ was a slippery slope that sets dangerous precedent and impinges on individual rights. Justice Roberts added, “And here the government is saying that the Federal Government has a duty to tell the individual citizen that it must act … That changes the relationship of the Federal Government to the individual in the very fundamental way.”
Justice Scalia was quick to wade in after Justice Roberts questioning, ” what would be next in the role of the government dictating to its citizens ( if the mandate were to be upheld). “I will tell you the next something else (we will next tell Americans to do) is exercise, because we know that lack exercise contributes to illness.” It seems that this debate is indeed creating odd bedfellows as civil liberties advocates are joining conservatives in warning that the next thing the government will be telling people is that they cannot drink sugary soft drinks or that they have to eat broccoli. It is hard to find a time when a conservative Justice and the ACLU share a common opinion about anything.
I have had to take some time off for the funeral of someone very near to me, so I have not had a chance to comment on the Supreme Court hearings. Nor do I have much time to do so now. But I would like to comment on Justice Alito’s line of questioning about burial insurance. His questioning was in response to one argument used to justify the purchase mandate, namely that sick individuals will receive medical care at someone else’s expense and therefore there is an economic justification for mandating the purchase of health insurance in order to prevent free riding. Alito noted that individuals who did not provide for their own burials will still be buried at taxpayer expense. This is another form of free riding. If the Supreme Court were to uphold mandatory purchase of health insurance, could Congress not also mandate purchase of burial insurance?
Solicitor General Donald Verrilli seemed surprised by Alito’s questions and did not provide a good answer. Yet these questions strike at the heart of the case and at deeper economic issues. There is a direct analogy between the market for burials and the market for healthcare. Just as some patients free ride off of the generosity of others, some deceased do the same thing. By extension, any time that a good is provided at a price below cost, whether by the government, a charity, or any other organization for that matter, we can expect a certain degree of moral hazard behavior. Some individuals who ought to purchase the good themselves will instead free ride on the generosity of others.