In a core plank of the “Pledge to America” unveiled earlier this month, the GOP leadership of the House of Representatives promised to repeal Obamacare and put in place “real” health care reform. Insofar as Obamacare represents a massive transfer of wealth and gums up the health care industry with over-regulation, it does need to be scrapped, shredded and incinerated.
But the Pledge’s idea of what constitutes reform inspires little confidence that Republicans have a credible alternative to runaway costs and shrinking access to health care. Indeed, the vacuous verbiage of the Pledge suggests that its authors have only the most superficial understanding of what ails America’s health care system and will fail miserably to fix the problem when they take charge of the House next year, as they seem poised to do.
The Pledge’s critique of what’s wrong with Obamacare was mostly on target. The new law will raise taxes and increase costs. Because it will barely pay for itself, if at all, the law does not seriously address the nation’s long-term fiscal crisis. While expanding benefits for some working Americans, Obamacare strips Medicare Advantage benefits for millions of seniors. (The GOP could have broadened its indictment by noting that the “reform” also will discourage innovation and competition by driving many small insurers and physician-owned hospitals out of the marketplace.)
But the Pledge omits any mention whatsoever of a revolution in thinking that has emerged from the health care industry: The way to contain escalating medical spending over the long run is not through traditional cost-containment measures but by bringing productivity and quality up to private-sector standards. It’s as if the Republicans had been put in charge of building the world’s most powerful bomb during World War II and they tried to tackle the job without alluding to nuclear fission.
Let’s cover some of the Pledge’s concrete ideas:
Enact medical liability reform. Congress has largely missed the boat. While Congress dithered, many states have already reformed their laws, with the consequence that the worst abuses have been curtailed. Tort reform might help on the margins, but it will not create the massive savings that congressional Republicans think it will.
Purchase insurance across state lines. Republicans contend that opening up health care insurance to competition across state lines will allow consumers to buy lower-cost plans with fewer state-mandated requirements from insurers in other states. State mandates are a very real problem. But if this reform were enacted, the medical lobbies would simply shift their attention from state governments to Washington, D.C. Over time, mandates would become national in scope, obliterating the pockets of lighter regulation that now exist.
Expand Health Savings Accounts. HSAs do encourage enrollees to exercise more care as consumers: buying generic drugs, using urgent care centers instead of emergency rooms, shopping for the best deals on labor and delivery, and the like. But those savings apply only to the simplest and most routine of encounters with the health care system. Americans lack the information to make intelligent consumer choices based on price and quality of care for cancer, heart bypass surgery or even the treatment of chronic disease like diabetes or kidney failure, which account for the bulk of health care spending.
These ideas may do modestly more good than harm, but they will fall far short of transforming the healthcare industry on the sweeping scale that the country needs to avert fiscal calamity. Congressional Republicans have failed to articulate a vision for entrepreneurial, market-driven change as an alternative to Democrats’ vision of bureaucratic, top-down reform.
One last point: Obamacare has enacted a component that is essential to evolving a market-driven health care system: a mechanism for collecting and publishing medical outcomes data. Patients cannot exercise informed consumer choices without knowing how hospitals and doctors compare in the quality of the care they deliver. It will take years to put this mechanism into place. It would be insanely self-defeating for Republicans to scrap this and other productivity/quality initiatives in their zeal to repeal Obamacare. But the hatred of Obamacare burns so fiercely that congressional Republicans appear likely to indiscriminately jettison the good with the bad.
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