Besides the editorial I discussed earlier, The Wall Street Journal has another editorial on health care reform. This promotes a Republican plan. In any health care reform plan the devil is in the details and I will want to look at this far more closely so I will only comment in general here.
The editorial suffers from the same faults as in most conservative discussion of health care, with distortions as to the degree of government control which is advocated. They ask the typical question, “Who will control the system? Doctors and patients, or politicians and regulators?” This ignores the fact that health care decisions are increasingly being made by bean counters for private plans which give far less autonomy to patients and physicians than under Medicare.
Putting aside the ideological biases of the article, here is a general outline of the plan:
Four Republicans in Congress — Sens. Tom Coburn (Oklahoma) and Richard Burr (North Carolina) and Reps. Paul Ryan (Wisconsin) and Devin Nunes (California) — will today introduce a bill that moves away from federal centralization. Aptly called the Patients’ Choice Act, it provides a path to universal coverage by redirecting current subsidies for health insurance to individuals. It also provides a new safety net that guarantees access to insurance for those with pre-existing conditions.
The nexus of their plan is redirecting the $300 billion annual tax subsidy for employment-based health insurance to individuals in the form of refundable, advanceable tax credits. Families would get $5,700 a year and individuals $2,300 to buy insurance and invest in Health Savings Accounts.
Low-income Americans would get a supplemental debit card of up to $5,000 to help them purchase insurance and pay out-of-pocket costs. They would have an incentive to spend wisely since up to one-fourth of any unspent money in the accounts could be rolled over to the next year. The combination of the refundable tax credit and debit card gives lower-income Americans a way out of the Medicaid ghetto so they can have the dignity of private insurance.
This is certainly an improvement over John McCain’s proposals last year. I do see such assistance to individuals as a plus, but question why Republicans would support these expenses while attacking other ideas for spending more on health care reform as being unacceptable for creating a new entitlement. Another huge plus of this is that it addresses the problems of Medicaid (which is a totally different creature than Medicare). I have not been very enthusiastic about some Democratic plans which see expansion of Medicaid as an answer to providing coverage to the poor.
Ezra Klein also sees this as in many ways being closer to moderate Democratic proposals than to what Republicans such as John McCain have offered in the past:
In essence, Coburn, Burr, and Ryan are abandoning the individual market entirely. Like Democrats, they’re arguing that individuals cannot successfully navigate the insurance market, and they need the protection of government regulation and the bargaining power that comes from a large risk pool. This is literally the opposite approach from McCain, who attempted to unwind the employer-based insurance and encourage families to purchase health coverage on the individual market. The core elements of this plan, in other words, make it the same type of plan Democrats are offering. A plan that enlarges consumer buying pools rather than shrinks them. It’s pretty much exactly what I’d expect a Blue Dog Democrat to propose. And it’s further evidence that the argument over health reform is narrowing, rather than widening. And it’s narrowing in a direction that favors the Democrats.
One question is whether these sums will be enough to provide care for all. This partially depends upon whether there are really effective measures to ensure coverage for those with preexisting conditions, as well as older individuals. Restrictions against denying coverage for preexisting conditions could easily be circumvented if insurances can continue to charge prices which are prohibitive to those over forty, who are more likely to have medical problems.
Perhaps even some compromises can be made by taking both this general idea and combining it with some of the ideas of Democratic supporters of health care reform. For example, add in the idea promoted by John Kerry in 2004 to open up the private plans available to members of Congress and federal employees to all individuals. If there continues to be a problem with older individuals obtaining coverage, allow them to buy into the Medicare program as many Democrats have been advocating. Whether the Republicans are open to such compromises might tell whether they are serious about health care reform or are just trying to offer a watered down plan to avoid more meaningful change and, as Matthew Yglesias suspects, gut Medicare.