Monthly Archives: July 2015

What’s Blocking Consensus on Health Care

In the wake of the Supreme Court’s King v. Burwell ruling, some have argued that a more bipartisan approach to health policy may emerge. But fundamental philosophical disagreements between liberals and conservatives suggest that rapprochement will be difficult.

Philosophical disagreements played into in the debate over pre-Obamacare health coverage. Many conservatives argued that people should be allowed to keep their plans (as the president originally promised). Most also want to liberalize the ACA’s definition of “insurance.” That involves widening the age rating bands—older people will pay a little more, so younger people can buy cheaper policies—and eliminating some benefit requirements so that, to use a frequently cited example, single men don’t have to purchase pregnancy coverage and retired couples don’t have to buy plans that cover well-baby visits. In a speech in October 2013, just after the failed HealthCare.gov launch, President Barack Obama talked about how some Americans have “cut-rate plans that don’t offer real financial protection in the event of a serious illness or an accident.” The administration had always wanted to eliminate some plans. Political pressure and the technical meltdowns of many exchanges upon their launch that fall forced the administration to extend the period for which some plans were grandfathered. But this was a temporary concession to political reality; its objective has not changed.

Another example of administration flexibility working toward its preferred ends involves the program that allows states to seek years-long waivers from certain provisions of the ACA. By one argument, the “State Innovation Waiver” would allow states to “alter the ACA’s generous ‘minimum essential benefits’ requirements,” which mandate types of coverage. Some of those requirements involve coverage that many people don’t want or need, and that contribute to insurance premium increases. Language in section 1332 of the ACA says that states using a waiver must cover as many individuals, with at least as comprehensive insurance benefits. In other words, states can alter the “minimum essential benefits”—but only in a way that makes them more generous, not less so. If states want to prioritize resources for certain groups—say, individuals with disabilities—over coverage of able-bodied adults, the “flexibility” in Obamacare would prove elusive.

The administration has also been inflexible about some approaches to state Medicaid expansion. Utah proposed adding job search requirements as part of broadening the program, but the administration refused to go along. Last year, Pennsylvania’s then-governor, Tom Corbett (R), proposed a mandatory work/job-search requirement, but administration opposition led to the proposal becoming a voluntary job referral service.

Ideally, states function as laboratories of democracy, and one state’s experiments can spark broader national trends. But when it comes to health care, the administration and Obamacare are offering little flexibility to states whose leaders have differing philosophical objectives. This suggests that, at least in the near term, bipartisan health experiments will remain an elusive goal.

This post was originally published at the Wall Street Journal’s Think Tank blog.