Wednesday, November 3, 2010

A GOP HOUSE: WHAT NOW FOR HEALTH CARE REFORM?

Having pulled off a very big win in the House of Representatives and substantially reduced the Democrats’ majority in the Senate, Republicans are now faced with deciding just what strategy to adopt towards health care reform.

GOP leaders are already promising a bill to repeal reform early in the new session, but with the Senate and the White House in Democratic hands, this is political posturing. Almost certainly there will be a repeal bill offered, and the odds are that it will pass the House, only to die or be vetoed in the following weeks. Given the huge amount of public confusion about the contents of the Affordable Care Act, much of it created by commentators on the right, the best guess is that the Republican bill will be a simple one, intended just to roll back most ACA provisions. The real objective, however, given its certain fate, will be to reemphasize how out of touch Democrats are with the “will of the people.”

More realistically, Republicans will then turn to their alternative strategy, of trying to starve reform of funding by voting against the budget. This is a risky strategy, as Newt Gingrich discovered in the time of the Clinton administration, but with Democrats having just a half-dozen majority in the Senate, it could be one that forces some compromises by the Democrats.

What might such compromises look like? It may be too late for the much-debated medical loss provision to be eliminated, although many Dems would surely be glad to offer this embarrassment up as a sacrifice. Medicare changes are an obvious area, since the program is dependent on the federal budget. Insurance exchanges could also be a victim, perhaps being reduced to a series of demonstrations, for example only in states where governors are actually eager to put them in place. Given the Tea Partiers’ emphasis on slashing expenditures, some of the subsidies and credits in ACA may also see some cutbacks, although neither party’s leaders will want to be accused of taking away individuals’ entitlements. There may also be a few areas, like the opt-out provision for lower-income group plan enrollees, that would simplify ACA without significantly generating political opposition on either side of the aisle. One last possibility, given the Democrats’ small Senate majority, is a revival of some of the features of last year’s bi-partisan Wyden-Bennett bill, like changing the tax treatment of employer premium payments, although the tempting threat to union negotiating power may not be enough to offset other employee and employer concerns.

One area where a compromise will not happen is the individual mandate. The White House will not give on something so fundamental to universal coverage—or so necessary to spread insurance risk and premium dollars—while many Republicans may feel confident that the Supreme Court will find it unconstitutional and be willing to wait for that ruling.

Finally, it’s also possible that Republicans may really not worry too much about repealing reform. With the majority of state houses in GOP hands, and given the inherent difficulties of implementing insurance exchanges and expanding Medicaid, there may be political advantages to waiting for the inevitable problems to start to become apparent in the fall of 2012, just in time for the next presidential election.

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