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How Would a Bipartisan Health Bill Be Possible?

Image: How Would a Bipartisan Health Bill Be Possible?
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By Megan McArdle, Bloomberg View
Saturday, 15 Jul 2017 09:27 AM Current | Bio | Archive

Mitch McConnell is once again announcing that the Senate is going to come out with a new health-care bill and try to hold a vote next week. That exhaustion you feel is the same despair that seeps over you when a pair of ill-matched friends announce for the 17th time that they’re getting back together.

As with those friends (we all have them, don’t we?) there seems to be no set of mutual goals upon which a durable partnership can be built.  Many Republican legislators want Obamacare to die. Others would probably attend the funeral with ill-concealed delight, but they don't want a reputation for having killed it. Still others would like to be able to tell voters that they “did something” about Obamacare, even though in reality they are loath to actually, you know, do something -- because their states would lose money, or voters would lose insurance.

Indeed, these may not be discrete factions of Republicans on the Hill. Often these desires seem to war within the same head. Small wonder that the party works on the compromise bill, the more it inches toward the status quo. As Phil Klein of the Examiner noted this week, “Brick by brick, GOP versions keep restoring parts of Obamacare.”

Whether or not you think the status quo preferable, that’s going to be a tough sell to a lot of senators -- and even if they pass it, in the House it’s going to be … challenging. The hard-liners in the lower chamber aren't going to rubber-stamp a bill that looks like Obamacare with the fonts changed.

In the old days, of course, the solution to those conservative defections would have been to pick up some moderate Democrats and pass a bipartisan bill. But that seems a long time ago, and political galaxies away from where we are now. Or is it? Republican Senator Lindsay Graham of South Carolina says he’s crafting an alternative, bipartisan bill that might offer a way out of the Obamacare mess, a more viable path than either the AHCA or the BCRA.

Cue the movie clip of a guy saying “It’s so crazy, it just might work!” Then turn to the question that naturally follows: What should a bipartisan health-care bill look like? We vaguely recall how bipartisanship worked, back when it worked. Compromise. Horse-trading. Quid pro quo. What should Republicans be willing to give up to get enough Democrats on board?

As an exercise on paper, the answer is easy:

  1. Stop trying to make this a tax-cut bill, and focus on reforms that can pave the way to fiscal stability, and dismantling many of the perverse incentives that have so distorted our health-care system.
  2. Leave Obamacare’s taxes intact. (Yes, even the dumb ones, of which there are many.)
  3. Turn Medicaid into a fixed grant rather than an open-ended entitlement, either by making it a block grant, or switching to a flat per-beneficiary payout -- but don’t try to make block grants a confusing cover for very deep cuts to the program.
  4. Provide generous funding to stabilize the individual health-insurance exchanges, but demand in return very wide latitude for states to decide how they stabilize their insurance markets -- including jettisoning any of the Obamacare regulations they think are getting in the way.
  5. Meanwhile, move the system more aggressively toward health-savings accounts plus catastrophic insurance—and get Democrats on board by offering to have the government fund some portion of those health savings accounts for low-income citizens.

Is that my ideal health-care system? No. But it gives Republicans some of what they want (a more consumer-driven, pro-market program in the individual market, and a big start toward reforming the bloated and byzantine mess that is the Medicaid program). It gives Democrats some of what they want (money for people who don’t have very much of it, plus they don’t get splattered by the fallout of Obamacare exchanges melting down). In theory, it could pass.

And in theory, I could play third base for the Yankees, if Joe Girardi were willing to hire me. The truth is that after years of complaining about obstructionism, Democrats have developed a sudden taste for the stuff; there’s a substantial faction of both politicians and voters who want the Democrats to stand by and do nothing, nothing, that Republicans might like. And even among those who think they want bipartisan compromise -- well, I spend a lot of time listening to those folks, and when you get down to it, frequently their idea of a “compromise” is that they get a huge government program that costs hundreds of billions of dollars, and Republicans get trivial increases in the size of health-savings accounts, and maybe to twiddle with a few of the outer decimal points on growth rates. In other words, what they think is a vision of compromise is too often actually a vision of America ca. 1992, when Republicans were a minority party who had to come begging for crumbs.

Republicans, meanwhile, don’t even have that much of a coherent vision. Too many of them have an ardent desire for Obamacare not to ever have passed, and no idea how to either get the country back to that point, or live with the new reality. The continued existence of Obamacare in largely its current form is a dealbreaker for both parties, which means there’s unlikely to be a deal.

That said, Congress has been able to pass a couple of bipartisan health-care bills in recent years: the 21st Century Cures Act in late 2016, and the Medicare Access and CHIP Reauthorization Act of 2015, more commonly known as the “doc fix” bill. The former reforms mental health care and funds medical research; the latter, most important among its provisions, permanently jettisoned an enormous scheduled cut in Medicare doctor reimbursements, which Congress had been frantically putting off for years and finally recognized was never going to happen. Both bills passed by overwhelming margins.

What do we see in these bills? The sums involved, while hardly trivial, are small relative to the federal budget. The scope of the bills was modest, and each of them had well-organized and mediagenic interest groups lined up in support. The changes made were technical matters that were not explained to large numbers of people, because neither bill was well known to many voters. And while the absolute number of people directly affected by them was large, the percentage of voters who were likely to experience personal loss due to their passage was pretty small.

This may depress those of you who long for a government that soars with ambition, but this is what a bipartisan bill looks like these days: too small to attract much attention from anyone besides wonks and dedicated lobbyists.  Can we envision something matching that description that could take the place of the troubled Republican health-care proposals?

Yes, just barely. Jettison the ambition and just do one thing: stabilize the individual market by giving money to states to figure out how to shore up their ailing exchanges. It gives legislators a little pork to take home, and solves a real problem. It makes Democrats happy because Obamacare lives to fight another day; it makes Republicans happy because they don’t have to explain to voters how come Obamacare died a horrible lingering death after they took office.  It doesn’t do terrible things to the government budget, even if it doesn’t do anything good, either.

Even this seems like a very hard sell in the current partisan environment. And unfortunately for Republicans, “very hard sell” looks like the best of the options they have.

Megan McArdle is a Bloomberg View columnist. She wrote for the Daily Beast, Newsweek, the Atlantic and the Economist and founded the blog Asymmetrical Information. She is the author of “The Up Side of Down: Why Failing Well Is the Key to Success.”

  1. For those in the audience who do not speak Hill, those are the acronyms for, respectively, the American Health Care Act, which is the House bill, and the Better Care Reconciliation Act, which is the Senate’s remix.

  2. Yes, I know you have an extended argument ready about how it was dying before and it’s not their fault. I am familiar with this argument. I even, mostly, agree with it. Only that doesn’t mean voters are going to be persuaded by an incumbent candidate's 20-second soundbite apologia.

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Even this seems like a very hard sell in the current partisan environment. And unfortunately for Republicans, “very hard sell” looks like the best of the options they have.
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