A White Flag on Health Care

Democrats denouncing the new House GOP health-care bill should actually be dancing in the streets. Perhaps, in the privacy of their own homes, the savvier ones are popping the champagne corks. The true meaning of the proposed legislation is that, after eight years of all-out political and ideological struggle against Obamacare, Republicans have surrendered - pretty much on all fronts.

House Speaker Paul Ryan, R-Wis., should have written the bill on a large white tablecloth and run it up the nearest flagpole.

Yes, yes, the plan is labeled “repeal and replace.” And, true, it does away with many of the Obamacare provisions that conservatives most reviled, including the individual mandate to buy insurance and a bevy of taxes. If enacted and fully implemented, the plan probably would insure fewer people and shift more of the cost down the income distribution scale, in part by restricting the flow of Medicaid funds to the states.

Democrats and their allies in the liberal policy community are not wrong to fret about that. However, when they look up from their spreadsheets, what they’ll notice is that much of Obamacare’s architecture remains: The GOP bill relies on regulated and subsidized individual insurance, plus a Medicaid program that would be smaller than it has been since Obamacare began, but still larger than it was before, to fill coverage gaps left by the mainstays of U.S. health care: Medicare and employer-paid plans.

After vilifying that set of interlocking policy compromises as a budget-busting, freedom-destroying ticket to second-rate medical care, the leaders of the GOP House have now declared, in writing, that they don’t have a fundamentally different idea, much less a better one. Even the individual mandate, and the “tax penalty” that enforced it, isn’t really gone. It is recast as a requirement to maintain continous coverage, enforced by a surcharge payable to insurance companies.

Heretofore, the health-care debate was a contest between Republicans, who were bent on repealing “every word of Obamacare,” and Democrats, who defended it.

Now it’s an argument about whose subsidized-regulated-individual-market-plus-some-Medicaid thingy works better.

And it’s far from clear that the Republican mousetrap would win this contest. What would it do to the federal deficit? The bill didn’t come with the usual Congressional Budget Office fiscal projection, but it’s hard to believe there’s a fiscally responsible way to maintain so many of Obamacare’s popular benefits, such as coverage for preexisting conditions, as the bill does, while abolishing or postponing the taxes that would help pay for them, as the bill also does.

Who knows if this bill would actually stabilize individual insurance markets, as the GOP claims? Again, by purporting to fix them, the Republicans have assumed the burden of showing that their incentives are better calibrated to draw young, healthy people into the risk pool than President Barack Obama’s were. One conservative health-care expert, Avik Roy, has crunched the numbers and calls the plan “a recipe for . . . death spirals” in the individual market.

To be sure, the bill attempts to evade, or postpone, political fallout by waiting until after the 2018 elections for its most controversial provisions to take effect: Medicaid expansion, for example, wouldn’t end until 2020 - plenty of time for a state or two that balked under Obama to change their minds! - after which skimpier federal funding kicks in. Maybe this gambit will work. Or maybe it just hands the Democrats a campaign issue: Vote for us and we’ll stop the GOP cuts.

Conservative true believers certainly aren’t impressed. “Many Americans seeking health insurance on the individual market will notice no significant difference between the Affordable Care Act (i.e., Obamacare) and the American Health Care Act,” wrote Michael Needham of Heritage Action for America. “That is bad politics and, more importantly, bad policy.”

Needham has a point. However, there’s little evidence that Americans are clamoring for the free-market alternatives that Heritage Action and other Obamacare critics have been pushing - and which the House leadership accordingly eschewed.

Donald Trump got elected president by promising to repeal Obamacare - except for all the good stuff such as preexisting-condition coverage and up-to-26-year-olds staying on their parents’ plans - as well as to protect Medicare.

A not-unfair summary of the typical American voter’s view on health care might go like this: “Give me a plan with abundant covered services and choice, and shift as much of the cost as possible onto someone else, while protecting the poor, but for heaven’s sake don’t make it ‘government-run.’ “

That inconsistent set of demands pretty much defined public opinion back in 2009, too, which is partly why Obamacare came out as it did. It represented the maximum politically feasible distance Democrats could move toward their top goal, universal coverage.

The GOP bill conversely - and revealingly - represents the maximum progress House Republicans think they can make toward free-market health care without committing political suicide. They sure didn’t get very far.

Charles Lane is a Post editorial writer specializing in economic and fiscal policy, a weekly columnist, and a contributor to the PostPartisan blog.