Paul Ryan is desperately trying to resuscitate his failed plan to end Medicare by offering it as the replacement element in the long-sought “repeal and replace” strategy for the Affordable Care Act.
“Giving patients and consumers control over healthcare resources would make all Americans less dependent on big business and big government for our health security; give us more control over the care we get; and force health care providers to compete for our business,” Ryan said.
Ryan argued that a tax credit in lieu of Medicare, Medicaid and government-credited employer-sponsored healthcare would commoditize healthcare costs, enabling individuals to choose their coverage and allowing the free market to drive down prices and make care more affordable — and generous — for all.
So if you liked getting a coupon instead of your Medicare and being pushed out on your own onto the individual marketplace, you’ll love getting the same coupon for Medicaid and for any coverage you get from an employer. It would basically spell the end of risk pooling, the end of collective bargaining for lower costs in health care. The costs would get shifted from government to the individual, and overall health costs would rise, as the insurance industry would be unburdened by the need to negotiate down prices with powerful coalitions of potential customers. This just replaces public debt with private debt, and grows that private debt larger.
This is the fundamental difference between liberals and conservatives on health care: the argument of rugged individualism versus the argument of collective responsibility and the power of bargaining. It’s pretty clear from the available evidence that putting more “skin in the game,” the linchpin of Ryan’s strategy, ends up raising health costs. The health care marketplace simply does not act like a real marketplace.
We keep doing this in health care, implementing policies that are supposed to tap competitive forces and constantly being surprised when they cost more than the regulated approach. Yet every other advanced economy has figured this one out and saves the equivalent of around 5-8% of GDP compared to us (while covering their whole populations with comparable or superior health outcomes–hat tip, PVdeW).
We would do well to learn this lesson the next time Rep. Ryan or whomever starts going on about injecting market competition. That works much better for future options on pork bellies than it does for pain medication.
Ryan thinks he can pitch a slow curve ball by his own party, with the assumption that the victories in NY-09 and NV-02 “prove” that his plan to replace Medicare with a coupon is not toxic, and that Republicans can win with that message. This is a massively misleading argument, but if Ryan really thinks he can get his party on board with that, go for it. Unfortunately for him, Republicans don’t appear enthused.
While the GOP will continue to push for complete repeal of health care reform, Chuck Clapton, Sen. Mike Enzi’s (R-WY) chief health care staffer, told Politico’s Jennifer Haberkorn this morning that Republicans won’t put forward a united proposal until the party has decided on a presidential nominee. “Members of Congress aren’t going to want to get in front of the candidate…I don’t know if there is much of a political advantage that comes from a candidate laying out what a repeal and replace strategy would be right now.”
They don’t want to offer an actual plan for fear that voters might actually scrutinize it, and that they would be responsible for governing rather than their normal strategy of throwing spitballs and profit-taking for contributors.