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The Agenda

NRO’s domestic-policy blog, by Reihan Salam.

Uwe Reinhardt on Health Reform



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In an interview with Ezra Klein, Uwe Reinhardt, a strong advocate of the president’s health reform proposal, is echoing many conservative critiques. On the excise tax, he seems to advocate something closer to the Bush proposal:

There’s an assumption that that will move people out of such generous policies and increase take home pay. I’m an economist. When I teach students, I believe this stuff. But I have my doubts that it will work. I would have liked to see a tax on the place of work rather than the insurers. I would have said if you make less than $75,000, you don’t pay any tax. If you make between $75,001 and $199,999, you pay taxes on some of the insurance. And if you make above $200,000, the whole thing is taxed.

And as many conservatives have argued, the mandate, on which the intellectual architecture of the proposal depends, is actually very weak. 

This thing will not get us off the hook cost-wise. But it’s a bit like moving into a house. You’ll spend another half year having workmen come fix the house. The individual mandate, for instance, is not good enough. You could still have young people pay the fine, and you’ll get the death spiral. I think they should have a window, if you enroll now, you’re in the club. But if you don’t enroll now, if you decide to play the adverse risk selection game, then if you try to reenroll, you can be discriminated against for health status.

Note that the approach Reinhardt outlines was also advanced by James Capretta, an NRO contributor who was one of the leading opponents of the president’s proposal. 

Somehow I suspect that our conversation about the likely costs and consequences of this proposal will suddenly get a lot more honest. Keep an eye on what will happen to estimates of cost savings. 



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