The 50-State Solution

Ezra Klein points to a mostly forgotten provision in the Reid bill devised by Senator Ron Wyden, who has been processing for a very different model of health reform for years now. 

The waiver was inserted by Ron Wyden and it gives states considerable flexibility to walk away from parts of the bill if they believe they can better address cost and coverage on their own. The legislative language itself is complicated, but during the Senate Finance Committee’s mark-up, Wyden clarified it with the committee’s counsel. “My reading of what we have in the bill now,” Wyden said, “is if a state can demonstrate that they can meet the criteria — particularly on cost containment, improving the delivery system — they can do it without an individual mandate. And can I ask, counsel, is that a correct reading of the Waiver Amendment that I offered?”

This strikes me as very attractive. The important question is whether it gives states adequate room to experiment. For example, Texas might decide that it would rather invest in community health center that could offer low-cost primary care to the poor rather than expanding low-deductible insurance coverage for the middle class. It’s not obvious that this would pass muster under Section 1332. If this waiver were broadened it might make the Reid bill far more palatable.

If the Reid bill does indeed fail and efforts to pass a more centralized proposal through reconciliation also fail, I would strongly recommend that Democrats and Republicans back a plan that (1) federalizes Medicaid and (2) gives the states far more room to experiment with policies designed to expand coverage. I would also favor a well-designed public reinsurance plan, but that could wait. To be sure, I’d also love to see a variety of other measures backed by conservatives, including efforts to limit if not eliminate the tax exclusion for employer-provided coverage. But I think that we could build a consensus around those two simple ideas. This compromise plan would meet many of the core objectives of liberals and conservatives, including the shared objective of reducing government spending on medical care over time. 

Reihan Salam — Reihan Salam is executive editor of National Review and a National Review Institute policy fellow.

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