Tyler Cowen, one of my favorite bloggers and thinkers, writes:
And also let’s assume — as is likely the case — that Obamacare is here to stay and thus that is taken off the table. The most important development is simply that Republicans (and Democrats) support the potential for Obamacare to reduce the rate of growth of Medicare expenditures. That is the #1 issue in fiscal policy today. And it saddens me how infrequently it comes up, except to be attacked.
As I understand PPACA, its main tool for controlling the rate of growth of Medicare expenditures is IPAB. I strongly support IPAB. And I also support fairly ambitious public reinsurance concepts, drawing on Harold Luft’s approach.
My strong sense is that the insurance subsidies and the Medicaid expansion in the law are so poorly designed that we’d be better off starting from scratch. Tyler could be right that PPACA is here to stay. If the president is reelected, it’s difficult to see him signing repeal legislation. Would he be willing to sign a face-saving overhaul of PPACA? Perhaps. That question will become more salient after November of 2012.
That said, I certainly think it makes sense to envision what such an overhaul might look like. One good starting point might be then-Sen. Judd Gregg’s February compromise proposal, which Ross Douthat recently cited:
The centerpiece is his plan to begin reform by first guaranteeing access to a low-premium policy that protects against catastrophic costs but also expressly allows preventive benefits and disease management under the deductible. He would modify the existing Health Insurance Portability and Accessibility Act to allow employers greater freedom to reward workers who participate in wellness programs, such as giving up smoking or losing weight. And given his New Hampshire roots, he subscribes to a host of the so-called Dartmouth reforms to promote accountable care organizations and incentivize “shared decision making” between physicians and elderly patients about treatment options.
I still think the McCain or PCA approaches are preferable, but Gregg’s proposal seems like a solid starting point.
P.S. Tyler writes:
1. I don’t think Reihan is actually disagreeing with me here.
I just wanted to underline that I think it still makes sense to press the case against PPACA, because there is an imaginable universe in which we can repeal and replace the law. To be sure, repeal and replace depends on winning over a nontrivial number of Democrats, in Congress and in the wider public, as a successful replacement effort would need to engage moderates as well as conservatives.