More Republican Health-Care Follies

by Ramesh Ponnuru

I. The Charade of “Repeal”

Over the last two days it has been a little harder than usual to figure out what, if anything, the Republicans are thinking on health care. Let’s start with the conservatives who wanted the Senate to vote on “repeal” of Obamacare and are now complaining about the Republicans who voted against it.

In 2015, the Republican Congress sent President Obama a bill to “repeal” Obamacare. The quotation marks are there because the bill wouldn’t have repealed the bill’s regulatory heart, just its spending and tax provisions. So Obamacare-compliant policies would have still been expensive, but people would have had no subsidies to help pay for them. And, since people would now be free to drop their insurance without paying a fine, in all likelihood a lot of healthy people would have just stopped buying insurance, sending premiums even higher.

In recent days a group of conservatives — including Senators Mike Lee, Rand Paul, and Ben Sasse — demanded and got another vote on this “repeal” legislation. Now some conservatives are complaining that several senators voted for this bill in 2015 but voted against it this time. They should be complaining that anyone voted for this bad idea either time, not that some people had the sense to vote against it this time. Why it’s supposed to be more conservative than the legislation Republicans had been working on over the last few weeks is beyond me. That legislation would have relaxed some of Obamacare’s regulations, reformed Medicaid, and pulled premiums downward.

One theory holds that passing this partial repeal would bring Democrats to the table. It takes effect after two years, and supposedly Democrats would work with Republicans on health legislation to prevent the damage the bill would do to health-care markets. Whatever else you think about this theory — and I think it’s crazy — it’s not contingent on the bill’s being good conservative policy; it’s contingent on its being terrible. So at least its premise is correct.

II. The Magical Mystery Conference

The latest Republican plan seems to have three steps. First, the Senate will, if enough Republicans agree, pass a “skinny bill” that gets rid of the individual mandate, the employer mandate, and maybe some Obamacare taxes. This bill, though, is not supposed to be the Republicans’ final product: Its limits are disappointing to Republicans who want more, and it would have perverse effects. Getting rid of the individual mandate, for example, will raise premiums if not coupled with other measures. So then comes step two: Form a conference committee including House and Senate Republicans to come up with something better than the skinny bill. And step three: Pass this better bill through both the House and the Senate.

What’s mysterious about this strategy is why, if there’s a bill that hangs together and could get 51 Senate votes, Senate Republicans don’t just pass it now instead of waiting for the conference committee to work its magic. Maybe the committee is expected to perform literal magic?

III. Pro-Tax Republicans?

One line of conservative criticism of the “skinny bill” is that it would cater to corporate interests. The medical-device tax, for example, would be abolished. I agree with those conservatives who say that business lobbies have too much sway among Republicans. It distorts their priorities, reduces their political appeal, and sometimes results in bad policies. But conservatives should not need reminding that sometimes businesses are right to want what they want and that, well, “corporations are people, my friend.” There’s a reasonable argument, for example, that the medical-device tax takes away good jobs.

Likewise, stopping Obamacare’s sales tax on insurance from happening — it’s one of the few parts of the law that hasn’t gone into effect yet — would be good for insurers. But it would also reduce premiums. The consulting firm Oliver Wyman did an analysis for the health insurers’ lobby in 2015 that estimated that getting rid of the tax would bring premiums down in the individual market by more than $200 a year. The per-employee savings in company plans would be bigger. If Republicans can’t even exert themselves to stop a pending Obamacare tax, they have even less justification for being in office than has previously seemed to be the case.

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