Healthcare could be deciding issue (E-8)

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Between illegal immigrant “caravans,” pipe bombs, and nonstop media attacks on the president, the looming mid-term elections seem truly unpredictable. Will positions of the candidates on policy issues have anything to do with the outcome, as we would hope, or are they basically extraneous? And if policy positions do matter, what issue (or issues) will carry the most weight?

Recent polling suggests healthcare may be uppermost in the minds of voters, overshadowing the economy or jobs. Healthcare is the top voter issue as elections enter final weeks, poll finds, Robert King, Washington Examiner,

The Kaiser Family Foundation poll released Thursday found that 71 percent of voters called the issue of healthcare “very important.” *** When asked to pick only one issue as the most important, healthcare topped the list again with 30 percent of voters, compared to 21 percent for the economy and jobs.

GOP pundit Karl Rove calls healthcare the “Democrats’ most potent national policy issue in the 2018 midterms.” Republican candidates are being accused of callous disregard for the needs of ailing Americans based on their votes to repeal GovCare, he notes, and must counter charges that they favor gutting the ban on denial of healthcare insurance (HCI) due to “preexisting conditions.” Healthcare is the sleeper issue of 2018, Karl Rove, Wall Street Journal,

Democrats mistakenly insist Americans must accept all of Obamacare’s failings—lost coverage, lost doctors, skyrocketing premiums and more—if they want protections for those with pre-existing conditions. The GOP should argue that they can cover Americans with pre-existing conditions without the damage Obamacare has inflicted. This puts Republicans on offense and positions them as change agents rather than defenders of a healthcare system many Americans believe is broken.

For their part, Democrats don’t need to offer solutions; they can simply present themselves as defenders of the status quo. How Democrats flip the healthcare issue, Peter Morici, Washington Times,

The Democrats may not offer a credible plan for fixing the high prices Americans pay [for healthcare]. It doesn’t matter, because the GOP didn’t deliver. All Democrats really need is to show up, wave the healthcare flag and win.

So accepting that Republicans have the most to prove in this area, how well have they been doing thus far? As a focal point, let’s consider the president’s remarks about healthcare at a recent political rally.

A. Background – President Trump spoke to a massive audience in Houston last week in support of Senator Ted Cruz and other GOP candidates from Texas who are on the ballot this November. Transcript,, 10/22/18.

In introducing the president, Senator Cruz characterized himself and his opponent (Rep. Beto O’Rourke) as disagreeing on “every issue.” He went on to contrast the Cruz/O’Rourke positions on the tax cut enacted in 2017, the economy, immigration, gun rights, and the relocation of the US embassy in Israel, but didn’t discuss healthcare.

The president took the podium and spoke for over an hour, covering numerous subjects. His remarks about healthcare were scattered through the speech rather than being discussed as a unit. And his basic thrust was to attack the other side’s positions on healthcare rather than offering specifics of Republican accomplishments or proposals.

A rundown of his healthcare remarks follows (in blue font), essentially verbatim but not in chronological order, with our comments in contrasting font.

B. Democratic positions - O'Rourke supports a socialist takeover of healthcare. You're going to triple your taxes and it won't be enough. And it will be lousy healthcare. You'll end up waiting for five weeks to see a doctor.

Really? Perhaps this statement reflects Mr. O’Rourke’s true sentiments, but he has switched from talking about “Medicare for All,” a tough sale in the Lone Star State, to advocating ideas for beefing up GovCare. Where Ted Cruz and Beto O’Rourke stand on the issues, John Moritz,,

O'Rourke said on Facebook last year that ‘single-payer Medicare-for-all program is the best way to ensure all Americans get the healthcare they need.’ He later modified his position, saying Medicare "is one option" toward universal coverage. On his issues page, there's no mention of Medicare for All or for a single-payer plan. Instead, he calls for beefing up Obamacare, including adding an optional plan where policyholders could buy into a government-run plan similar to Medicare.

Democrats in Congress have already signed up for a socialist takeover of healthcare that would eliminate the private insurance of more than 15 million Texans. The Democrat plan would destroy Medicare and terminate Medicare Advantage for 1.4 million Texas seniors who depend on it. Republicans want to protect Medicare for our great seniors who have earned it and who have paid for it for a long time.

This statement seems accurate for some congressional Democrats, notably Sen. Bernie Sanders, but Medicare for All isn’t on the Democratic agenda in 2018. Perhaps it will be in 2020, depending on wins the party’s presidential nomination. As for policy implications, the president’s view seems solid. Trump v. Sanders on “Medicare for All,” Betsy McCaughey, New York Post,

•Sanders calls Trump a liar. Fortunately there’s a way to determine who’s telling the truth. The answer is in the 96 pages of Sanders’ bill. Here’s what it says. Four years after Medicare for All begins, all private insurance will be banned (Sec. 107), and Medicare and other government health programs will be terminated, just as Trump said. Everyone, including illegal immigrants, will be enrolled in the new government program (Sec. 106). Newborns will be automatically enrolled at birth (Sec. 105).

•[In] the new scheme, hospitals will be paid at Medicare rates for all their patients, not just seniors (Sec. 611). With everyone on Medicare for All, no cost-shifting will be possible. The rates will be 40 percent less than what hospitals could get from private insurance plans. The severe short-changing will throw hospitals into crisis. Meanwhile, demand for care will surge, because it’s free to all comers.

The Democrat plan to destroy American healthcare includes free healthcare and education to illegal aliens paid for by you, thank you very much, the American taxpayer.

This claim pertains to immigration policies, not healthcare policies per se, but a steady influx of low income, relatively uneducated immigrants will surely add to the financial burdens of federal, state and local governments. Or as Milton Friedman famously put it, “you can't have free immigration and a welfare state." Open borders and the welfare state, Robert Rector,,

C. GOP positions - Republicans will always protect Americans with pre-existing conditions. We protect you. Pre-existing conditions. Right?

Denial of any intention to eliminate the ban on denial of HCI based on preexisting conditions may be politically necessary, and it’s factually defensible; Republicans have repeatedly provided assurances that said ban would be carried forward in whatever law might replace or amend the Affordable Care Act (legislation that created GovCare). Healthcare is the sleeper issue of 2018,
op. cit.

The preexisting conditions offensive against the GOP is based on its votes to repeal Obamacare. But the truth is that Ms. McSally, Mr. Cramer and every Republican in Congress who voted for repeal also voted to require states to provide protections for people with preexisting conditions. The GOP approach was to let each state figure out how best to accomplish this under a federal system that worked better than the Affordable Care Act. Republicans trusted leaders in state capitals to do better than Washington for the people of their states.

However, acceptance of the preexisting conditions ban may impede longer-term efforts to reform the GovCare model. Republicans will be haunted by their desperate defense of Obamacare’s preexisting condition ban, Philip Klein, Washington Examiner,

[Once] Republicans accept that insurers must offer coverage to all comers, it’s inevitable that they’ll have to embrace the community rating regulation that makes sure insurers cannot charge more based on health status. Otherwise, insurers could jack up premiums on those with serious illnesses, effectively putting insurance out of reach even if it’s technically offered. They’ll also have to embrace Obamacare’s “essential benefits” rules, or else insurers could discourage sicker individuals from buying their policies by picking and choosing what to cover. It also then becomes necessary to offer subsidies to ensure that those with less means can get coverage. Add it all up and you’re stuck with Obamacare.

And with Ted, I'll tell you, he was incredible. With Ted's help, we repealed the core of Obamacare, the individual mandate penalty that everybody hated. And it's gone. Everybody hated it.

Conservatives were delighted by this change, which was effected by a provision in the Tax Cuts and Jobs Act enacted just before Christmas last year. And “Texas Ted” did indeed play a key role in getting the change approved. Sen. Cruz: It’s a “mistake” for House bill to raise taxes,,

At a news conference Tuesday, Cruz said it’s vital to use the tax legislation to end the mandate that all Americans have health[care] insurance or pay a penalty. If nothing else, he said, doing so will in effect be a tax cut for the 6.5 million Americans who now pay a penalty because they don’t have health[care] insurance coverage.

A lawsuit brought by some 20 states is now pending to strike the rest of the ACA on grounds that elimination of the individual mandate destroyed the constitutional basis for the Supreme Court’s initial upholding of this legislation. The individual mandate wasn’t actually repealed, however, Congress simply cut the applicable tax rate for those not having HCI to zero for tax years starting on or after 1/1/19. Without the individual mandate’s tax, Obamacare should fall apart in court, Brad Schimel & Ken Paxton,,

Although the administration has declined to defend the ACA in this litigation, resulting in much criticism from the other side of the aisle, we anticipate that the ACA will be upheld again (as it has been in two previous rulings of the Supreme Court). And when the dust settles, the absence of the individual mandate will probably not have a major effect on GovCare one way or the other. Doomsday will not follow repeal of Obamacare individual mandate, Robert Moffit,,

We've taken bold action to reduce the price of prescription drugs. Americans should not be forced to subsidize lower drug prices in foreign countries while paying the highest drug prices ever in the history of this world. We've gone through the process. It's a statutory process. I'm very soon finished with it. Drug prices will soon be plunging. Watch. Secretary Azar, great job.

The administration deserves credit for attempting to devise policies that will bring down prescription drug prices. To date, however, no major reductions in drug prices have resulted. And initial thoughts about the international free rider situation didn’t sound promising. The high cost of prescription drugs,

For all the angst about lower drug prices in other countries, almost all of which have refused to bear a proportionate share of US R&D costs for new drugs, there was no proposal to narrow the price differential by authorizing the importation of lower cost drugs into the US. (Such a practice would vitiate patent protection for drugs developed in the US, which seems like a clearly bad idea.)

Instead, the US will apparently ask other countries to pay more for drugs they import from the US or produce under patent licenses. Don’t hold your breath! US trade negotiators are already “as busy as one-armed paper hangers” with other “mission impossible” assignments from the president.

More likely, the president was thinking of a new proposal, which would effectively force price reductions on drugs dispensed in hospitals (Medicare, Part B) vs. prescription drugs (Medicare, Part D). Trump outlines plan to lower Medicare drug prices to match prices overseas, Robert King, Washington Examiner,

The administration released a request for comment on a proposal to allow Medicare to determine the price it pays for certain drugs based on the cheapest price that another nation pays. HHS believes the new payment model would lead to a projected total $17.2 billion in savings over five years.

The big drug companies reportedly don’t like the proposal, but HHS Secretary Alex Azar defends it as still allowing higher profits on US drug sales and reasonable under the circumstances. Re how soon drug prices would be plunging, the proposal wouldn’t become effective until late 2019 at the earliest. Azar: Trump’s moves are “ultimate nightmare” for Big Pharma, Tom Howell, Washington Times,

To help critically ill patients get life-saving treatments, we just passed right to try. Do you know what that is? That's a person who's very sick, they're terminally ill, they want hope. [This is one of the president’s pet stories, and he went on to take several minutes telling it.]

This legislation is not likely to bring down healthcare costs, if anything it will have the opposite effect, but we agree that individuals with apparently terminal conditions deserve a “right to try” if there is an experimental treatment that might help them.

Perhaps the real point of telling this story is to rebut perceptions that conservatives lack compassion for their fellow human beings.

We obtained $6 billion to fight the opioid epidemic, which is a big problem.

Claiming credit for this bill seems problematic, as it represented a genuinely bipartisan effort to address an appalling problem. Trump signs sweeping opioids bill, Tom Howell, Washington Times,

There may be a serious downside, moreover, in that tighter regulation of prescription pain killers may boost the use of illegal drugs that are even more dangerous. The opioid fix that wasn’t, J.J. Rich, Washington Examiner,

We passed veteran's choice, giving our veterans the right to see a private doctor, instead of waiting on line for one month, two months, three months, four months. And having a simple illness corrected, you'd have people that stand in line so long they would have a simple problem, and by the time they got to see a doctor, they were terminally ill. *** These are our great people. If our veterans have to wait online, they go out and they see a private doctor. We pay the bill. And we get them fixed up. And we also passed for the veterans the V.A. accountability law to ensure that anyone who mistreats our veterans will be accountable. *** You couldn't fire these people. You couldn't get them out. They could be sadists. They could be thieves. They could do whatever they wanted to do. You couldn't fire them.

Unlike the overall healthcare system, the Veterans Administration (VA) provides true socialized healthcare for veterans (former military personnel meeting service criteria, generally 6 months or more on active duty). That is, care is provided in government-owned facilities by government employees.

VA healthcare services are expensive, and the quality/responsiveness to patient needs has often been subpar. Dissatisfaction peaked around 2014 (Thoughts about the VA scandal,
5/26/14) , and there have been a series of personnel and policy changes since then.

The changes touted by the president, i.e., access to private healthcare services if the VA is too slow and enhanced flexibility to fire incompetent employees, are probably a step in the right direction, but they may not go far enough. Query whether this government-run healthcare system can ever work very well.
Ibid, part D (design problem).

If you vote to elect a Republican House and a Republican Senate, we will continue to cut your taxes, cut your regulations, raise your incomes, help your jobs, take care of your medical problems. We will protect Medicare and Social Security. The Democrats will never be able to do it.

The defense of Medicare and Social Securing by a Republican president is somewhat ironic, in that these middle class entitlement programs were originally put in place by LBJ and FDR, respectively. And what’s the basis for saying Democrats will never be able to protect these programs, other than perhaps the argument (previously covered) that Medicare for All would entail the destruction of Medicare as it now exists?

Perhaps the thought is that the president and his supporters can save the day by speeding up the economy sufficiently to save the government from fiscal catastrophe, but so far the government’s deficit has been soaring on their watch rather than contracting – primarily due to excessive overall spending levels. Don’t overthink the fiscal problem, it’s not that complicated,

The president is no doubt reading the prevailing political sentiment on entitlement programs correctly, but open-ended promises to “protect Medicare and Social Security” are neither wise nor credible. Our political leaders need to give serious consideration to restructuring these and other entitlement programs, and action should be taken sooner rather than later.

D. Other points – Assuming that healthcare truly is the top policy issue on the voters’ minds this year, which party is staking out a winning position? Based on the debate that is taking place (as exemplified by the foregoing analysis of the president’s remarks in Houston), the upshot seems to be about a draw.

The Democratic position (preserve GovCare with all of its deficiencies, or else push forward with Medicare for All or whatever) is weak. Barring de facto healthcare rationing, which Democrats aren’t advocating and no one truly wants, greater government control can’t be expected to attack the core problem of the US healthcare system – excessive costs.

Republicans (taking the president’s remarks in Houston as representative of the GOP position) haven’t offered a credible solution to the cost problem either, with the arguable exception of drug price proposals that won’t necessarily live up to the claims being made.

Eliminating the individual mandate (effective 1/1/19) will benefit workers who would otherwise pay a tax for the privilege of not buying HCI coverage they don’t want at the price available, but does this mean they would wind up without HCI coverage?

The administration has been experimenting with alternative HCI arrangements for workers whose employers don’t provide HCI or who earn too much to be eligible for Medicaid), notably short-term coverage and association plans. Rethinking the healthcare system – part two, section B (alternative insurance arrangements),

In effect, as one observer put it, Trump is making Obamacare optional, Ryan Ellis, Washington Examiner, 10/26/18.

The Trump administration is so committed to giving people choices and options, it is even making Obamacare more palatable. It's done such a good job putting in best practices and common sense reforms that Obamacare premiums will rise next year at a rate of less than four percent, a huge improvement over the double-digit annual premium spikes we’ve had to endure.

Also, efforts are underway to delegate more authority over details of healthcare programs to state authorities and facilitate the development of innovative approaches. For example:

•Gov. Larry Hogan has signed a five year agreement with the federal government, relieving MD of a raft of federal Medicare requirements; the state expects to save $1 billion over the next five years. Maryland governor signs federal all-payer health[care] contract, us,

•The Trump administration has demonstrated growing receptivity to waivers from the Obamacare rules. CMS expands waiver letting states rewrite Obamacare rules, Philip Klein et al.,

. . . certain states have asked the Trump administration to allow them to move people from the Medicaid program onto the exchanges. Other states have said that they preferred setting up high-risk pools that would fund medical care for the sickest customers in order to not have an effect on the rest of the Obamacare market and decrease premiums.

Hmm, why didn’t the president talk about these alternative approaches? For one thing, the details are too complicated for a political rally. Also, such changes to the status quo would predictably be attacked as circumventing the ban on denial of HCI based on preexisting conditions, authorizing the sale of junk insurance, etc.

So which party is going to prevail in the upcoming elections, and where is the healthcare saga headed longer term? We don’t know, but it will be interesting to see what happens.


#Good points. As for who will wind up winning the healthcare debate, maybe it will boil down to: “follow the money.” - SAFE member (DE)

#Healthcare takeover is like a metastatic tumor implanted to infect the host in all areas and thus become the leading need for tax revenues. – SAFE director

Comment: US healthcare is the most expensive in the world; costs are capped in other countries by de facto rationing. If single payer is adopted, a similar pattern will inevitably develop here.

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