Politics & Policy

Graham-Cassidy Is a Too-Mild Improvement on Obamacare

Sen. Lindsey Graham and fellow GOP senators on Capitol Hill, September 19, 2017. (Reuters photo: Aaron P. Bernstein)
Single-payer is inevitable if the GOP can’t come up with a bold alternative.

Yogi Berra was right: It’s déjà vu all over again.

Health-care reform is back on the table. With time rapidly running out — the reconciliation rule that would allow legislation to pass with just 50 senators’ votes expires on September 30 — Republicans may take up yet another proposal to “repeal and replace” Obamacare.

The legislation, proposed by Senators Bill Cassidy (La.) and Lindsey Graham (S.C.), is less ambitious than previous repeal efforts, which might just enable it to piece together enough votes to pass. Essentially, Graham-Cassidy would fold all current Obamacare funding, both premium subsidies and Medicaid-expansion funding, into a single block grant to each state. Keeping this money flowing means that Graham-Cassidy must keep most Obamacare taxes in place. Only the individual and employer mandates and the medical-device tax are repealed. This has led Rand Paul to warn that the bill simply “rearranges the furniture a bit, changes some names, and otherwise masks what is really going on — a redistribution of ObamaCare taxes and a new Republican entitlement program, funded nearly as extravagantly as ObamaCare.”

Particularly troubling is the way that the bill’s sponsors are using a reallocation of funding to round up support from reluctant Republicans. The bill would shift money from some high-cost states, such as California, Massachusetts, and New York, to more rural states (read: red states). The bill’s supporters are essentially playing the time-honored Washington game of promising “free money” to the states. That never fails to be popular with governors and senators from those states that “win.”

On the positive side, supporters of the legislation correctly point out that it would give the states far more flexibility with the funds they receive, and would allow them to waive many of Obamacare’s more onerous regulations, including the mandate to buy coverage, mandated benefits, and pre-existing-condition coverage requirements. Those are the regulations most responsible for driving up premiums and destabilizing insurance markets.

Meanwhile, on the other side of the aisle, Bernie Sanders has introduced his latest version of “Medicare for All.” Like the Republicans, Bernie has also scaled back his proposal, which originally called for a government-run, single-payer system. This one would cost only $1.4 trillion per year. That would be more than a third of our entire current federal budget.

Bernie Sanders’s plan one would cost $1.4 trillion per year. That would be more than a third of our entire current federal budget.

Wary that the price tag will likely terrify many Americans, Bernie doesn’t actually include any mechanism in the bill to pay for all this new spending. Still, his office suggests some possibilities, including: a 7.5 percent hike in payroll taxes (bringing the total tax to nearly 23 percent), a 4 percent income-tax increase on all Americans, and additional tax hikes on corporations and “the rich.” While calling his proposal Medicare for All, he would actually offer benefits far more generous than those found in current Medicare, including dental and vision care. In fact, the benefits would be more generous than almost any national health-care system anywhere, including Canada. And it would all be “free”: No deductibles, co-payments, or out-of-pocket costs.

And when Bernie says single payer, he means it. His plan would outlaw private insurance, either employer-sponsored or individual. If you don’t like what the government gives you, tough!

The contrast here is not just between rival health-care plans. Ever since 1945, when Harry Truman first proposed a national government-run health-care system, progressives have known what they want. From Medicare and Medicaid through the Children’s Health Insurance Program and the Affordable Care Act, they have advanced steadily, if incrementally, toward that goal. We are not talking about a conspiracy theory, but an ideological worldview that encompasses health care.

Bernie’s plan is the latest step in that long march toward government health care. It is not going to pass anytime soon. But that fact that it is co-sponsored by 17 senators and supported by nearly every rumored Democratic candidate for the 2020 presidential nomination shows the degree to which Democrats are united around a common goal. We can disagree with what they seek, but at least we know what it is.

And, Republicans? They want a bill that will pass.

Think about it. In the battle of ideas over health-care reform, Republicans have unilaterally disarmed. When was the last time Republicans explained what a free-market health-care system would look like, how it would work, and why it would be better for health-care consumers? The old adage is true: You can’t beat something with nothing.

That’s why Republicans are once again trying to eke out a narrow win on a bill that slows but doesn’t reverse the ongoing march to socialized medicine.


NR Editors: Graham-Cassidy is Worth Passing

Graham-Cassidy Is a Triumph of Federalism

No to Single-Payer

Michael TannerMr. Tanner is the director of the Cato Institute’s Project on Poverty and Inequality in California and the author of The Inclusive Economy: How to Bring Wealth to America’s Poor.


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