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Some Conservatives Still Pushing the Obamacare Repeal Rock Up the Mountain

Another Obamacare repeal effort...will this lead to anything but another Sisyphean result?

Obamacare repeal isn’t dead yet according to a report from the Hill:

Conservative groups are hoping to release a new ObamaCare replacement plan later this month as they try to keep alive the repeal effort.

The effort has been led by the Heritage Foundation, the Galen Institute and former Sen. Rick Santorum (R-Pa.), who have been meeting at Heritage’s offices, along with other groups, roughly once a week for months.

The plan has essentially no chance of moving in Congress this year. Republican congressional leadership has made clear that it has moved on from the ObamaCare repeal effort this year.

Not dead, but maybe we should view its chance of success with the same skepticism that a zombie from Walking Dead can run down the winner of the Boston Marathon.

Why?

The spectacular failure of anti-Obamacare efforts in 2017 was the result of a number of blunders in politics and policy, but two key elements stand out that any future effort to repeal or significantly amend Obamacare must address to succeed:

1) Provide universal access to coverage. What? Conservatives can’t support that you might say. Well, maybe many conservatives can’t, but the opinion of the country has shifted to supporting universal access to coverage — including without pre-existing conditions (note that universal “access” to coverage is quite different than actual universal coverage). Gallup and Pew have both covered the clear shift, and two conservative thinkers have made a similar point:

The country has reached a consensus that people who have elevated risks but have always paid their premiums and stayed insured should not be penalized for their health status with higher premiums. That being the case, there must be appropriate financial incentives for everyone who wants to enjoy this social protection to stay insured.

One of the reasons moderates blanched at actual “Repeal and Replace” proposals in Congress, dooming the initial attempt at passage in the House, and ultimately failing in the Senate, was this new political reality was never properly addressed. It wasn’t enough to get rid of the bad parts of Obamacare (which are many), the perceived good parts of Obamacare — near universal access to coverage — had to be protected in order to pass Congress. Will this new attempt at repeal led by Heritage, Santorum, and company address that?

2) Address the issue of health care prices. Critics of Obamacare rightly point out the regulatory regime forced upon the individual market led to a massive price increase for the cost of health insurance. Defenders of Obamacare like to claim federal subsidies offset much of the total premium cost for many individual market consumers … but that ignores the roughly 50% of the individual market who isn’t eligible for a subsidy. The pocketbooks of these mostly middle class Americans trying to buy unsubsidized coverage are the biggest collateral damage of Obamacare.

But, for all that, improving the regulatory regime of the ACA doesn’t solve the root problem of why all health insurance costs so much (not just in the individual market), and why costs keep rising: the cost of medical care and services. About 85 cents on the health insurance premium dollar goes to pay for medical care. And what’s the biggest factor in those 85 cents? The price of that medical care:

Why is U.S. health care by far the most expensive on the planet? At more than $10,000 a year per person, and nearly 18 percent of all goods and services, health care in America consumes roughly twice as much as it does in other well-off countries.

Fifteen years ago, the late Princeton economist Uwe Reinhardt authored a paper called “It’s the Prices, Stupid.” Now, using considerably better data that allow more meaningful comparison among health systems, Harvard researchers affirm that he was right.

They say the overriding reason for our out-of-whack costs is the exorbitant price tag attached to everything from doctors’ time to prostatectomies to brand-name drugs. Not extra or wasted care. Not red tape or a half-dozen other frequently blamed factors.

“All the evidence is that we haven’t paid enough attention to prices,” says Dr. Ashish Jha of the Harvard T.H. Chan School of Public Health. “And prices are where we are truly exceptional. We’re just higher for everything — drug prices, physician prices, nursing prices, hospital prices, MRI prices.”

Not a single proposal to repeal and replace Obamacare seriously addressed the issue of the cost of medical services that drives the cost of health care coverage. To be fair, neither did Obamacare itself. But, the truth remains that no effort at federal health care policy will address the issue of the rising cost of health insurance unless it addresses the issue of prices … and that likely requires picking a fight with two of the strongest (and at times most sympathetic) lobbies in Washington, DC: hospitals and doctors.

The issues of providing universal access to coverage and addressing the price of health care are admittedly incredibly challenging issues. But, that doesn’t mean they aren’t necessary for a serious effort to deal with Obamacare that can actually succeed on a policy basis. Threading the needle on the politics now is probably an entirely different — and perhaps intractable — challenge.

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