The fate of Obamacare will go a long way toward determining the ideological trajectory of our nation. Either Obamacare will be repealed and replaced with a conservative alternative (a huge win for restoring America’s founding principles of limited government and liberty) — or Obamacare will not be repealed or replaced, which would be a watershed win for liberals in their quest to transform our government from one of dispersed power and limited reach to one of centralized power and largely unlimited reach. The stakes are high.
It is not too surprising, therefore, that people are trying to read the tea leaves to determine where this battle is heading. Every word from a prominent Republican politician is being publicized and parsed, as Americans understandably look for clues about future actions.
The latest example comes from Super Bowl Sunday, when Fox News’ Bill O’Reilly interviewed President Donald Trump and asked him, “Can Americans in 2017 expect a new health care plan rolled out by the Trump administration, this year?”
“In the process, and maybe it’ll take ’til sometime into next year, but we are certainly gonna be in the process. Very complicated. Obamacare is a disaster. You have to remember, Obamacare doesn’t work. So we are putting in a wonderful plan. It statutorily takes a while to get. We’re gonna be putting it in fairly soon. I think that, yes, I would like to say, by the end of the year, at least the rudiments, but we should have something within the year and the following year.”
This seemed to conflict at least slightly with House Speaker Paul Ryan’s comments made three days earlier, in which he replied to a question about the timeline on Obamacare by saying that “we want to move our Obamacare legislation by the end of the first quarter” — so, by the end of March. Meanwhile, various Republicans, especially in the Senate, have started talking about “repairing” Obamacare rather than “repealing” it.
So, is all of this cause for alarm? Are Republicans losing their political courage to repeal and replace Obamacare in a timely manner?
The short answer is: No, not really.
Getting this matter right is a lot more important than moving with tremendous speed. Republicans should proceed strategically and briskly, not foolishly or recklessly. As the great UCLA basketball coach John Wooden liked to say, "Be quick, but don't hurry."
That would be a wise motto for the GOP to follow on Obamacare.
It is probably good, therefore, that Republicans appear to be slowing down a bit, letting Rep. Tom Price (R-Ga.) get confirmed to head the Department of Health and Human Services, and deliberating over their options. The battle ahead will not be easily won, and Republicans need to adopt a winning strategy. For example, they cannot afford to pass partial repeal legislation that undermines their coalition for a replacement.
At the same time, however, there is nothing productive about Republicans talking about "repairing" Obamacare. Former President Obama's namesake cannot be fixed; it must be repealed and replaced — and Republicans owe it to voters to fulfill the promise they have made across three victorious elections to repeal and replace it. Bobby Jindal put it well, tweeting, "Republicans who want to retreat from repeal to repair should be replaced."
With Democrats showing no signs of being willing to play ball, Republicans will likely have to move on repeal and replacement with little or no bipartisan support. That means they will have to use the budget reconciliation process, which avoids the 60-vote threshold for overcoming a filibuster and allows passage with a majority vote.
The downside to using reconciliation is that it will only allow Obamacare to be partially repealed, and partially replaced. For example, the worst cost-driver in Obamacare, in terms of raising premiums, is its "community rating" mandate.
That mandate effectively bans the centuries-old understanding of insurance — that it must be bought before the thing happens that one is insuring against — and turns it into something more akin to letting people buy homeowners insurance, at no higher cost, when their house is already on fire. Predictably, such federal hubris has led to a 40-percent premium spike, on average, in the individual market over the past two years alone.
It is not at all certain that this "community rating" mandate could be repealed via reconciliation, a process mostly limited to taxing and spending provisions. No one knows how the Senate parliamentarian will rule on this point, but there is a good chance that "community rating" will have to be left in place even as Obamacare is partially repealed. Since more than half of the premium increases under Obamacare are likely attributable to this harmful mandate, this means that after partial repeal, premiums would probably keep rising.
It is therefore imperative that Republicans use reconciliation to pass a good partial replacement and get it into effect as quickly as possible. There are three main reasons for this: One, such an alternative would encourage people to shop for value and hence put downward pressure on costs, helping to offset the ill effects of Obamacare's "community rating" to whatever extent possible.
Two, such an alternative would be great for middle-class Americans, who have long been denied a tax break for buying their own health insurance, even as their neighbors who get insurance through their job get a tax break.
Three, if Republicans fail to pass such an alternative, the Democratic attack ads would practically write themselves: "Republicans insisted on 'repealing' Obamacare, yet premiums are still rising — and where is that long-promised, seemingly mythical Republican replacement?"
The blueprint for such a replacement is already available. Tom Price's "Empowering Patients First Act" and the House's "Better Way" blueprint both call for simple, flat (aside from a few age-bands) tax credits. Price's legislation would give tax credits of $1,200 to those under the age of 35; $2,100 to those between 35 and 50; and $3,000 to those 50 and over; plus $900 per child, to those who buy health insurance of their choice.
Those who don't use their whole tax credit could put their savings into a health savings account that they would control. Price would also offer a one-time, $1,000-per-person tax credit for having, or opening, an HSA.
So long as such tax credits are really tax credits — going directly to individuals or families and cutting their taxes, not direct outlays to insurance companies masquerading as tax credits/cuts — this is the right blueprint to follow.
As for the differences in Trump's and Ryan's language about Obamacare timelines, both men clearly want to move quickly toward a winning repeal-and-replacement package. They seem to be on the same page. So GOP voters shouldn't fret.
When it comes to their view of Republican leaders on this issue, voters would do well to adopt the notion that Ronald Reagan put forward in a different context: Trust, but verify.