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  • On Thursday, the House of Representatives will bring to the floor the Republican health care reform plan, set to repeal much of the Affordable Care Act. The confusingly named American Health Care Act has been much criticized; this was as expected on the political Left, but quite viciously as well […]

    Why I Would Vote No On The AHCA As Is…

    On Thursday, the House of Representatives will bring to the floor the Republican health care reform plan, set to repeal much of the Affordable Care Act. The confusingly named American Health Care Act has been much criticized; this was as expected on the political Left, but quite viciously as well […]

  • After many years of promising a full replacement bill, and after months of haggling behind closed doors, the Republicans in Congress have submitted the first draft of their legislative language to repeal and replace the Affordable Care Act (Obamacare). Speaker of the House Paul Ryan and others released the language […]

    American Health Care Act: GOP Repeal And Replace Proposal

    After many years of promising a full replacement bill, and after months of haggling behind closed doors, the Republicans in Congress have submitted the first draft of their legislative language to repeal and replace the Affordable Care Act (Obamacare). Speaker of the House Paul Ryan and others released the language […]

  • Late last week, Politico was able to obtain an early draft of the proposed ACA repeal and replacement legislation currently weaving its way through the corridors of Congress.  Republicans are trying to piece together a platform that removes the most hated elements of Obamacare, while still maintaining a Federal structure […]

    GOP Health Care Plans: MAGAcare Comes To Life

    Late last week, Politico was able to obtain an early draft of the proposed ACA repeal and replacement legislation currently weaving its way through the corridors of Congress.  Republicans are trying to piece together a platform that removes the most hated elements of Obamacare, while still maintaining a Federal structure […]

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Why I Would Vote No On The AHCA As Is…


On Thursday, the House of Representatives will bring to the floor the Republican health care reform plan, set to repeal much of the Affordable Care Act.

The confusingly named American Health Care Act has been much criticized; this was as expected on the political Left, but quite viciously as well from the Right. I myself have extensively discussed why I am confused and angered by much of the bill.  From my previous post, I continue to believe the following is the worst mistake of all:

My biggest complaint about this bill is that there really is no governing philosophy in its writing. It neither pleases conservatives nor moderates. It makes half measures to increasing patient choice, but retains taxes such as the Cadillac tax, while at the same time maintaining the employer based health insurance system. It doesn’t maximize Federal support for the poor, nor does it full adopt the free market. It surely does some good things, such as expanding HSA/FSA and moving to a refundable tax credit system, but never fully seems ready to jump in with both feet in a full free market model of national health care. The muddle created by the GOP here makes it very difficult to make a sound, concise argument regarding specifically what their goal is. The President, Speaker Ryan, and the rest of Congress are likely to have a tough road ahead to make this sale to the American people.

Since that time, Republicans have been amending and altering the bill in small ways to try to make it more acceptable to the larger electorate. Some of the attempts, such as the so-called “Manager’s Amendment”, attempts to make the bill better to convince wary Republicans. Other attempts, such as the now labelled ‘Buffalo Buyout’, are simple classic horse trading of Federal dollars for votes, that have muddled the Beltway swamp for years (anyone remember the Obamacare “Cornhusker Kickback?”).

However, the amendments have failed to resolve my earlier complaint. What is the goal of this bill, Republican Party? Is it to make health care more affordable for the individual? Is it only to increase patient choice?  Is it to decrease federal spending? Decrease taxes? Or is it only a political tool to reverse Barack Obama’s signature achievement?

Even at this late date, I can’t answer that question. Proponents of the bill have made all the above claims, but actual reading of the bill fails to back up their claims.

Here is an example: let us take one key problem with the AHCA: does it really decrease cost for individuals?  The answer is very likely ‘No’, at least for most people. For example, one of the most glaring problems with the AHCA is that it will significantly increase net premiums for low-income Americans in their fifties and sixties. Health care pundit Avik Roy has talked extensively about this glaring defect:

For example: a 50-year-old childless adult making 200 percent of the Federal Poverty Level—$24,120—would face net annual premiums of $1,520, on average, under the ACA. Under the AHCA, she would see net annual premiums of $4,078, a difference of $2,855.

Now, this problem is solvable, and Roy provided the easiest solution: equalizing the tax treatment of employer-sponsored and individually-purchased health insurance. This has been a long stated goal of conservatives, in fact.

So you would expect the Republicans in power would use this solution, and happily go along their merrily way.

You would also be very wrong. Instead, Republicans failed to confront this cost issue for near elderly people (though there is a vague ‘promise’ of additional Federal spending that, as of the moment, still is absent from the final bill).

The added amendments did further increase tax cuts; but at the same time, they also further limited one major reform regarding consumer driven health care, another issue that conservatives claimed they cared about, but current Republicans apparently don’t think is a priority; again, from Roy:

In the original bill, if you were eligible for a tax credit of $3,000, and you bought an insurance plan that cost $2,800, the remaining $200 would be deposited in a Health Savings Account under your name. That feature of the bill gave consumers an incentive to keep premiums down, because they would economically rewarded for doing so. But the Manager’s Amendment kills that provision, because pro-life groups were worried that such HSA deposits could be used to fund abortions.

So, in short, Republicans decreased patient choice because…they are afraid patients would make choices politicians won’t like. Sounds a lot like Democrats.

Here is another example of where this bill goes two steps backwards for every step forward. Republicans are for more ‘choice’, correct? But in the most recent change in the bill, they would diminish the free choice of Veterans. In the initial bill, Vets would have the choice to either participate in the Veterans Administration, or could opt out and participate in the free market insurance system under the AHCA. However, in the most recent re-write, they would be prohibited from using the insurance exchanges and subsidies if they were eligible for VA benefits.

I could go on and on about this bill, in never-ending detail. The questions from my initial post remain: do the Republicans even know why they are writing this bill? If their goal is more patient choice, great…I am on board. But please see above..their own amendments show that is not necessarily the case.Is their goal to make access to more cost efficient insurance models? Fine. But they don’t allow that to be the case either. So what are they trying to achieve? Is this simply all about politics?

In short, this bill removes major portions of Obamacare, but replaces them with new regulations and rules that could be in many ways every bit as costly and cumbersome as its predecessor, without actually improving health in this country. That, to me, is the definition of failure.

President Trump, Speaker Ryan and others are making the political argument that this must be done now, or never. I don’t agree with that either, and past history is a good landmark in showing why they are wrong. Go back to the chronological history  ACA debate of 2009-2010, and you will see the debate was fraught with failures, starts and stops, and even moments when it appeared the process was on life support. And yet, the process continued. The GOP could continue this debate in much the same manner, if they have the political will to do so.

One final point; if you accept this bill as is, this plan virtually guarantees a decades long struggle around health care at the Federal level. Sure, the GOP will repeal some of the mandates, and most of the taxes. But the next time Democrats come to power, who here believes it won’t take them long to reverse course? Trump and company are guaranteeing that Obamacare, in some manner or form, is the law of the land for the foreseeable future, except we will have varying degrees of taxation, subsidies, and regulation dictating funding depending on which party rules the White House and Congress. That is a horrible situation for this country to be in, and this may be the one scenario in which the GOP could be building a regime that is actually worse than maintaining Obamacare…imagine that.

Republicans should go back to the drawing board. This plan is not worthy of passage in the House. Furthermore, everyone knows this plan is D.O.A. in the Senate.  There is at this point zero chance it gets 50 votes. It is always possible they could pay off enough Senators to get to 50 votes, but that is the same kind of corrupt bargain that Democrats used to get the ACA passed in the first place. Republicans should decide among themselves what their goals for reform really are, and build a plan around one singular philosophy. Pick one; any one.  Simply tinkering with Federal regulations and mandates as they are currently trying to do is not enough.

I am not alone at all in my dissatisfaction. FreedomWorks today came out against the AHCA, and is asking its followers to ask their Representatives to vote against the bill. The Freedom Caucus and Heritage Foundation, among others, have leaned the same way. I tend to agree with all of them.

In short, I see no reason to vote for this bill at this time. Patience and steadfastness is required at this time. Conservatives should hold to their beliefs, and fight for the greater good. The House should reject this bill, and try again.


American Health Care Act: GOP Repeal And Replace Proposal


After many years of promising a full replacement bill, and after months of haggling behind closed doors, the Republicans in Congress have submitted the first draft of their legislative language to repeal and replace the Affordable Care Act (Obamacare).

Speaker of the House Paul Ryan and others released the language of the bill earlier this afternoon, and the full bill can be read here. The bill is massive in scope, and has tremendous repercussions for the health care marketplace, if it is passed as currently written.

Here are just a few of the key provisions of the bill:

  • The individual mandate and employer mandate are repealed in its entirely, and are retroactively repealed for 2016. In its place will be a continuous coverage rule; this stipulates that anyone who fails to maintain health insurance coverage, and has a gap of greater than two months, will pay a 30% penalty when and if they resume their health care coverage. This was a major request by insurance companies, who wanted to make sure people could not game the system. However, there is an open question whether this new rule will be as effective as the individual mandate in forcing people into the health care market.
  • The bill does NOT repeal the Cadillac tax, one of the more hated tax provisions of the original Obamacare bill.  However, other taxes are eliminated (some in later years), such as taxes on tanning booths, prescription drugs, small business tax, and taxes on net investment income.
  • The bill defunds Planned Parenthood. Additionally, no tax credits can be used to purchase any abortion insurance services.
  • Medicaid expansion will continue until 2020, at which point the program moves to a per enrollee formula. At that point, block grants would replace the current funding mechanism. The grants are slated to grow at the rate of health inflation, not standard CPI. This is an important caveat, as the rate of inflation is higher, and thus, this would likely be more costly in the long run.
  • The minimum benefit regulation is repealed starting in 2020. However, the bill does retain many of the minimum basic services guaranteed under the ACA.  It does repeal the actuarial value requirements for cost sharing.
  • In lieu of the current subsidy regimen, there will be refundable taxable credits available to all persons who do not have access to other insurance markets (whether that be employer supplied insurance, Medicaid, VA, or Medicare). The tax credits will range from $2,000-$4,000 per person, and are age adjusted (instead of income adjusted). Credits phase out for higher income people ($75,000 for individuals, $150,000 for couples). This income credit will grow by CPI + 1% every year, with a family maximum of $14,000. In short, these credits will be less than is currently provided through subsidies, and in general, will be less beneficial to the poor and sick than the current system is.
  • Out of pocket costs are still capped.
  • Starting in 2019, the bill alters the age rating standards. Insurers can charge older patients up to 5 times as much as they charge young people (the current ratio is 3:1). This will decrease costs for the young, but ultimately increase costs for the older generation.
  • FSA and HSA will be expanded, allowing more money to be saved tax free.

There are many other provisions that the legislation refers to, but this gives a brief picture of the plan Republicans are currently proposing. In short, this is a plan that would provide more personal choice in types of insurance, but would provide less government assistance to obtain those services.

The tax credit scheme here will benefit the rich, the young, and the healthy, but will be more costly for the poor, the sick and the elderly. That is an obvious intentional trade-off made here, as the change in the age rating standards show.

Furthermore, some of the decisions here significantly limit the potential cost reductions going forward. For example, tying future Medicaid block grants to health care inflation may be sensible to maintain coverage, but will tremendously increase the long-term cost of the program. The cuts that do occur in this bill occur primarily after 2020, while much of the Obamacare funding remains at the current rates that exist today. So there will be little cost savings in any significant amount over the first few years of this replacement.

Politically, there are several landmines ahead. First and foremost is that this bill will almost certainly cover a few million fewer people than Obamacare currently does. Between the change in the Medicaid expansion program, along with decreased federal support for insurance premiums, the overall effect will be the rate of the uninsured is almost guaranteed to go up. Additionally, removal of the individual mandate likely destabilizes the already weak Obamacare exchanges, which may hasten their downfall.

Second, as stated above, some of the cost decisions lead to predictable trade offs. By increasing funding for Medicaid, the program is going to cost more. By increasing the tax credits from the level that Rep. Price originally proposed in his bill several years ago, there will be significant increased federal expenditures. These decision ultimately are going to lead to less savings overall once the CBO scores the bill. The question then becomes, is that level of cost savings worth the trade-off of millions more people becoming uninsured? There may be a logical argument for it, but the GOP, and especially President Trump, are going to have to be ready to make that argument to the American people. Already, small government conservatives like Sen. Rand Paul and Rep. Justin Amash are calling this ‘Obamacare 2.0′, which clearly draws a line in the sand where they think this debate now stands.

My biggest complaint about this bill is that there really is no governing philosophy in its writing. It neither pleases conservatives nor moderates. It makes half measures to increasing patient choice, but retains taxes such as the Cadillac tax, while at the same time maintaining the employer based health insurance system. It doesn’t maximize Federal support for the poor, nor does it full adopt the free market. It surely does some good things, such as expanding HSA/FSA and moving to a refundable tax credit system, but never fully seems ready to jump in with both feet in a full free market model of national health care. The muddle created by the GOP here makes it very difficult to make a sound, concise argument regarding specifically what their goal is. The President, Speaker Ryan, and the rest of Congress are likely to have a tough road ahead to make this sale to the American people.




GOP Health Care Plans: MAGAcare Comes To Life


Late last week, Politico was able to obtain an early draft of the proposed ACA repeal and replacement legislation currently weaving its way through the corridors of Congress.  Republicans are trying to piece together a platform that removes the most hated elements of Obamacare, while still maintaining a Federal structure to provide access to health care insurance.

The draft proposal has a myriad of problems and hurdles to overcome. Not least of which is it lacks a title…I for one have proposed the Make America Great Again Health Care Reform Act (MAGAcare).  But they, I’m sure they will come up with a running title that is even worse.

For me, the most significant proposal for most Americans is replacing income-based tax credits with age-adjusted tax credits. This seems esoteric on its surface, but would have a tremendous impact on how much access lower-income Americans (most of whom are young, after all) will have. It would dramatically shift the financial burden on to the poor and youth of America, while older (and generally wealthier) Americans would come out ahead.

The bill also likely would go a long way to further destabilize the already unhealthy Obamacare insurance exchanges.  By 2020, the bill would end cost-sharing reductions that help low-income people cover the out-of-pocket payments that most exchange plans impose, including deductibles. Additionally, they spend no money in 2018 and 2019 to fund those cost-sharing reductions in the interim.  Finally, and maybe most profoundly, the bill ends the individual mandate, one of Trump’s core promises. But the replacement, the continuous coverage provision that would require people to keep insurance constantly in order to guarantee access to insurance, likely would not be strong enough to force people into the marketplace.  As such, many young and poor likely will opt out all together, further risking the death spiral that many have feared from the beginning.

The most daring proposal at this point is the repeal of Medicaid expansion. The program has added more citizens to the insured rolls than any other part of the ACA, and as such, is very expensive but also fairly popular.  Local officials, predominantly Republican Governors, are very frightened of any proposal that would repeal a program that would leave millions of low-income people without sufficient health care access.

That is why on Friday, Gov. John Kasich of Ohio, maybe the leading Republican proponent for the ACA, went to the White House to make his case for Medicaid expansion. And if reports are to be believed, he had a receptive audience, not only from Presidential Son-in-Law Jared Kushner, but from the President himself:

A meeting Friday afternoon between President Trump and Ohio Gov. John Kasich, his former rival in the GOP primaries, had no set agenda. But Kasich came armed with one anyway: his hope to blunt drastic changes to the nation’s health-care system envisioned by some conservatives in Washington.

Over the next 45 minutes, according to Kasich and others briefed on the session, the governor made his pitch while the president eagerly called in several top aides and then got Health and Human Services Secretary Tom Price on the phone. At one point, senior adviser Jared Kushner reminded his father-in-law that House Republicans are sketching out a different approach to providing access to coverage. “Well, I like this better,” Trump replied, according to a Kasich adviser. [Bold added]

For hard-core conservatives, the fact that Trump prefers any health care proposal of Kasich’s over the mainstream Republican proposals is frightening, to say the least. The messaging from the White House on this program has been muddled, to say the least. For example, asked by George Stephanopoulos, host of ABC’s “This Week,” whether Trump “won’t touch Social Security, Medicare or Medicaid,”  deputy press secretary Sarah Huckabee Sanders responded, “Look, the president is committed to doing that. . . . And I don’t see any reason to start thinking differently.” I am not sure how you avoid touching Medicaid while still keeping the promise of repealing the Affordable Care Act…in many ways, they are one and the same.

Trump is likely to garner more opposition to current Republican congressional plans on Monday, when he meets at the White House with some of the nation’s largest health insurers. including top executives from Blue Cross and Blue Shield, Cigna and Humana. This will give those insurers every opportunity to lobby the President on maintaining federal financial support for their current insurance regimens.

In short, Republicans in Congress are largely left to themselves to figure out which direction to head, with lack of any leadership from the White House on the matter. Trump seems willing to talk and consider any proposal from anyone, but at the same time appears reluctant to take the lead on this because of the political risks involved, as well as possibly his own personal concerns regarding these specific reforms.

To their credit, Speaker Paul Ryan and Majority leader Mitch McConnell are moving forward and fighting the good fight. They know they face an uphill challenge in the Senate, where liberal Republican Senators such as Collins and Murkowski may defect at a moments notice. They believe that by moving forward quickly, they will play a game of chicken with wavering Republicans, in hopes that they won’t stand against them if push comes to shove.  Republicans’ “now or never” approach is seen by many leaders as their best chance to break through irreconcilable differences.

For all the talk from the White House and Congress however, the amazing aspect about all this is how little consensus has been achieved by the GOP. On major policy issues, even as basic as how to provide tax credits to individuals to buy health care, there is very little agreement. Unless Trump takes the leadership reins on this issue, this process may quickly become like herding cats.  The GOP must unite to be successful on this very difficult legislative maneuver, and only Trump has the power currently to make that unification possible.




Sen. Rand Paul’s Obamacare Replacement Act

Sen. Rand Paul, never one to be content to stay in the mainstream, released his own ACA repeal-and-replace plan on Wednesday.  The plan can be read here.

The plan has been far less discussed in public health policy circles than other Republican alternatives, and for good reason: it is by far the most radical plan proposed yet, and the least likely to pass Congress in its current form.

The core of his plan is as follows:

  • $5,000 tax credit per individual; this could be spent on either premiums or deposited in a health savings account;
  • Completely eliminates baseline regulations set up by Obamacare for minimum requirements of insurers, as well as the individual and employer mandates; in short, allows the complete return of pure catastrophic coverage.
  • Extends employee tax deduction to all individuals purchasing health plans;
  • Elimination of remaining regulations stopping sales of plans across state lines. Furthermore, to increase access to coverage, he would expand association health plans and allow individuals to purchase health insurance through non-traditional groups, such as churches and civic associations. Of specific note is that he would eliminate the consumer protections for pre-existing conditions;
  • Restores HIPAA’s pre-existing conditions protections. Prior to Obamacare, HIPAA guaranteed those within the group market could obtain continuous health coverage regardless of preexisting conditions.

Paul has stated openly what his philosophy on health care reform is…and it isn’t about expanding coverage or reducing cost. It is about freedom:

As we repeal Obamacare, we would be wise to vote on its replacement at the same time.

 What should we replace Obamacare with? Perhaps we should try freedom:

1.  The freedom to choose inexpensive insurance free of government dictates.

2.  The freedom to save unlimited amounts in a health savings account.

3. The freedom to buy insurance across state lines.

4.  The freedom for all individuals to join together in voluntary associations to gain the leverage of being part of a large insurance pool.

Paul also is one of the leading voices to push for both repeal AND replace at the same time. He argues that without both, too much of the Affordable Care Act would remain in place to make sufficient head way in reforming the system.

There is a lot in this plan to appeal to traditional conservatives.  Rand’s plan would essentially deregulate much of the health care system on the federal level, leaving minimal regulatory protections (for better and for worse).

Michael Tanner of the Cato Institute clearly voices the core conservative argument for Sen. Paul’s vision in an Op-Ed earlier this month:

Paul would eliminate the pre-existing-condition regulations altogether (after a transition period), while his other reforms would significantly reduce the number of people who genuinely cannot buy health insurance because of a pre-existing condition. For those who still need help, Paul envisions responsibility for covering them being shifted to the states, possibly in conjunction with proposals to block-grant Medicaid.

This would give states the freedom to experiment with ways to cover people who are unable to buy their own insurance for whatever reason, whether pre-existing conditions or low-income. Importantly, it prevents a small number of high-cost cases from distorting the rest of the insurance pool. It wouldn’t try to insure the uninsurable, but would provide their health care more directly. After all, it is health care that counts, not health insurance.

One can be forgiven for thinking that the last thing Republicans need right now is another health-care plan. And Senator Paul’s plan is certainly not perfect; there are nits to be picked. But it may well offer Republicans the best road map they can find out of the wilderness they have been wandering in.

The problems with this are obvious, if you have evaluated prior GOP alternatives. First, straight forward tax credits such as this will certainly benefit the healthy and young, but will be a net negative for the elderly and for sicker patients. This is a tradeoff that can’t be ignored. This cost issue has been estimated in and of itself to likely cause 5-10 million people to lose coverage after repeal of the ACA.

Furthermore, Paul never specifically answers how he will take care of individuals that for one reason or another cannot buy plans in the group market, mostly because of costly pre-existing conditions. He largely argues that he will ‘give states flexibility’ to reform Medicaid by providing block grants…but provides no other real answer to the question.

Even if you are willing to completely pass the problem off to states (which in a federalism view of government isn’t unreasonable) there is a political price to pay: there is no chance any Democrats (and possibly even a few moderate Republicans) would accept such a plan. They would demand an answer to the question, and as far as I can tell, Paul lacks any specific answer.

Furthermore, because Paul’s plan would require a Senate vote on complete repeal of Obamacare, he requires 8 Senate Democrats to join him…which seems impossible in this environment. I also suspect that although Paul has said President Trump has approved of his plan, that Trump may well change his mind once he understands all the repercussions of such a radical change. Trump would be unlikely to keep his many promises on health care under Rand Paul’s vision.

Paul’s plan is reasonable in an ideal world, but no such world exists. Today’s political environment simply makes it impossible to pass such a plan, unless the GOP somehow gets 60 votes in the Senate. As a position piece it is interesting, but as practical policy it is a non-starter.


Another ACA Alternative: Patient Freedom Act of 2017


Sens. Bill Cassidy of Louisiana and Susan Collins of Maine brought forth the first major Congressional alternative to the Affordable Care Act of this Congress, as they unveiled their Patient Freedom Act of 2017.  The full text of the bill can be read here. The senators promise the plan would designate more power and regulatory decisions to the states, and in turn hopefully increasing patient access and affordability.

This plan echoes a similar plan proposed by Sen. Cassidy in 2015.  That plan, notably, was written in the heated discussion over what would have happened to Obamacare customers if the Supreme Court had ruled against the Obama administration in the King v. Burwell case (the Court ultimately upheld the Obama Administration’s view, and Obamacare was left intact).

What makes this alternative quite different from the other Republican plans is that it would maintain most of the funding mechanism that existed under the Affordable Care Act. Cassidy and Collins state that there is simply no simple way to fund any system in the short-term without maintaining those taxes.  95% of the current funding per capita per state promised under the ACA would continue under this plan; the remaining 5% of funds would be used for health savings accounts and other expenditures.  Cassidy argues that he would be open to replacing that tax structure in the future, but only in approach of a larger tax reform bill. So overall expenditure under the plan would be quite similar to that under the Affordable Care Act, assuming no further tax changes.

Political negatives aside, by retaining the tax funding mechanism, the Senators are able to offer an alternative that no one else in the GOP is currently offering: allowing some states to keep Obamacare.

The plan would largely shift the decision-making on health care reform to the states. States would have one of three choices. States such as New York and California who are perfectly happy with the status quo can choose the first option and keep their current systems, with their funding remaining as defined by the Affordable Care Act of 2010. In short, little to nothing significant would change for them.

Option two would allow states to build their own health care plans, centered around individually owned Health Savings Accounts (HSA). Cassidy would provide a pre-funded HSA to all individuals in the form of an advanceable tax credit. The insurance plans would have to meet some basic requirements, such as guaranteeing catastrophic coverage, basic pharmaceutical coverage, mental health coverage, and some level of coverage for preventative care. One key attraction of this option? States that opt for this would not only receive all Federal funds that they would have received for subsidies through the Obamacare exchanges, but in addition would receive the full federal matching funds they would have received from Medicaid expansion, whether or not they decide to actually expand Medicaid. In short, this system would allow states to create a system using the private sector, and cover the poor in that manner, totally bypassing Medicaid, and retaining most of the federal funding while doing so.

The third option for states would be to opt out of federal funding all together. They would receive no federal funds, but would also be exempt from most of the federal regulations written into the bill.

Sen. Collins did make clear that some consumer protection provisions such as coverage from parents’ insurance until age 26 and prohibition from lifetime caps would be maintained across the board, regardless of what option states choose. For example, out of network excessive hospital charges, an issue that has been gaining greater attention over the past year, would be eliminated under their bill, something the ACA never even referred to.

Notably, they would not maintain the consumer insurance protections regarding pre-existing conditions, leaving that choice up to the states. There would be no individual mandate on the federal level, but a ‘Continuous coverage’ rule would require patients to avoid gaps of more than 63 days, or face being subject to late enrollment penalties and other costs.

There are other smaller provisions that could potentially lower overall health care costs. For example, states that allow universal health savings accounts would receive 2% of their total funding to population health initiatives, that could be used to treat any public health threat, such as opioid abuse or sexually transmitted diseases.

There are significant positives to Cassidy’s approach. First and foremost, it takes a more decentralized approach to health care reform. It allows states to tailor-make their plans to their populations, allowing them to avoid onerous federal regulations that may or may not be beneficial in their circumstance. It would maintain federal funding, basically through the equivalent of block grants, and that funding would be the equivalent per capita as those states that maintain Obamacare.

Cassidy would also give states the option to auto enroll their citizens into basic health care plans. It would allow patients to opt out, but they would have to actively pursue that course of action if they chose to do so. This is an important detail of the plan. It allows states to guarantee a high rate of insured among the population, without relying on the much despised individual mandate to achieve that goal.

There are aspects of the plan that are problematic however. Because of its accounting procedural changes, coverage of older and sicker patients would probably be less than under Obamacare. The program would allocate approximately $5,000 per person for people under 55, and $6,000 per person for those aged 55-65. That would likely dramatically increase out-of-pocket costs for that older aged and sicker subset.

Politically, Cassidy makes a very strong point: by allowing the option of liberal blue states to keep the Obamacare regimen, he has a better likelihood of drawing some Democrat Senators when a full plan comes to a vote in the Senate. I am largely pessimistic about the chances of Democrats crossing the aisle on anything as long as President Trump is in office. For example, Senate Minority Leader Chuck Schumer (D-NY) described it as “an empty facade that would create chaos.” That is not the greatest first impression one could have received from Democrat leadership. However, that may also be the opening salvo in a long debate on health care reform.

Across the aisle, some conservatives will argue that it maintains too much of the Affordable Care Act. The tax regimen would not change, and that is a major issue for some such as the Freedom Caucus.  Some federal regulations that are popular would remain, but some conservatives feel that such federal rules help distort the free market. Finally, this plan is not cheap, as it largely maintains the overall federal costs that would have been incurred under Obamacare. Are conservative Republicans willing to maintain that level of federal funding? That remains an open question.

In short, the Patient Freedom Act is a well thought out piece of legislation, and any fair-minded reader would have difficulty in saying that both Sens. Cassidy and Collins have not honestly put forth a solid effort in providing a plan that would answer most critics’ questions.  That said, like every health care reform plan, it has costs and benefits; there is simply no way to escape that.  It provides both states and individuals more freedom of choice than Obamacare, but in turn, provides slightly less benefit for some patients, especially the sick and the elderly.  It also maintains the ACA taxes in the short run, which will put off many hard-core conservatives. This is a trade-off, and politicians will  have to decide if that trade-off is worth it.  But in toto, it is a valiant effort that should be taken seriously as we move forward in the coming reform debate.


The Inauguration of Donald J. Trump, 45th President of the United States


Today, January 20, 2017, Donald J. Trump will place his hand on the Lincoln Bible, and take the oath of office to become the 45th President of the United States.

Exactly 8 years ago, I wrote a similar post to this one, regarding the 44th President, Barack H. Obama, that can be read  here.

There is a lot of similarities in my feelings regarding these two men, even though those opinions are separated by 8 years, large policy difference, and two completely different political parties.

This is what I said about Obama at the time:

I for one did not support the election of Mr. Obama. That said, even for me this moment is one to behold. Unlike many minorities, I have always believed in my heart that I would see a member of a racial minority elected president; I only wish it were a Republican! I never had a doubt in my mind that this would happen in my lifetime, unlike many in our society and in the mainstream media who proclaimed they never believed it would happen. Maybe it is a generational difference; I think most in my generation are proud, but not surprised, that we elected an African American President. I think there is also a divide among African Americans and the rest of American society. My African American friends still believe Obama’s election is surreal, that it can’t be happening. This is even more so with older African Americans, especially those that lived through the civil rights era of the 1960s. But ultimately, most people I know, even most Republicans who don’t support Mr. Obama’s policies, are proud that we were able to elect an African American to lead us.

Even now, after all the disunity that Mr. Obama caused with his policies over 8 years, I feel very much the same way. Obama’s legacy may be damaged, but the fact the US was able to elect a minority to the highest job in the land is something that shows the continual maturity of our great nation.

I concluded my piece about Obama’s Inauguration this way:

Don’t get me wrong. Mr. Obama is the American President. He is my president. I wish him no ill; in fact, if he does spectacularly, I will seriously consider voting for him in 4 years. But that does not mean that he should not be criticized. In fact, it is patriotic to criticize anyone and everyone who you disagree with politically. The political dialogue improves the country.

So, on this historic day, I wish Barack and Michelle Obama, and their two lovely daughters, all the congratulations and best wishes in the world. They will need our best wishes for what lies before them. And I hope Americans remember that the political fight is what makes us the greatest democracy in the world. I will fully support Mr. Obama when I agree with him, and fight tooth and nail when I don’t. I don’t think President Obama would want to have it any other way. As my hero, and Barrack Obama’s, Abraham Lincoln wrote to Horace Greeley on August 22, 1862,

I shall try to correct errors when shown to be errors; and I shall adopt new views so fast as they shall appear to be true views…I intend no modification of my oft-expressed personal wish that all men, everywhere, could be free.

Again, the similarities to today are stunning. I did not support Mr. Trump, but he is still my president. I wish him the best, and if the does a superb job, I will seriously consider voting for him in 4 years. Note that Mr. Obama was not able to achieve that goal, as I voted for Mitt Romney in 2012.

I hold to the standard that it is patriotic to criticize any person in power, and the more dialogue and discussion we have, the stronger this nation will be. I hope that Trump and the Republican party, who defended dissent for 8 years, holds to that philosophy.

And finally, I wish Donald Trump and his entire family congratulations, and nothing but the best wishes for the years to come.


Trump Versus The GOP’s Obamacare Repeal and Delay Folly


The race to repeal the Affordable Care Act is now on.  The promises of President-Elect Trump, as well as the Republican Congress, now come to fruition as they are left to deliver on their mandate to roll back Obamacare permanently.

Republican leaders on both sides of the Hill have largely focused on a strategy of repealing the majority of Obamacare through reconciliation, leaving components of the law intact because it would require a 60 seat majority in the Senate to pass.  In turn, once this repeal has been passed, the revenue stream will be phased out over time, leaving the country with an open question: what happens next?

That is the $2 trillion question.

First, let me stipulate that every conservative policy expert I have talked to uniformly agrees this is the moment to repeal as much of Obamacare as possible. Yes, components of the law will remain (such as regulatory restrictions like community rating, which impose high costs on the insurance market). However, the GOP will never have a window of opportunity like this to repeal the law, and if they are honest about their promises, they must move forward quickly.

Conservative Health Care Wonk Avik Roy argues that the GOP has no choice but to move forward with ‘repeal and delay':

The fundamental problem is that in order to fully replace Obamacare, Republicans need to come up with a bipartisan plan that can attract the 60 votes necessary to overcome a Democratic filibuster.

Given that Republicans don’t even agree among themselves as to how to replace Obamacare, it’s going to take them some time—at least a year or two—to figure out how to do that.

Based on dozens of conversations I’ve had with Democrats on this subject, it seems clear that Republicans’ best and only chance to get 60 votes is to develop a plan that can cover approximately the same number of people as Obamacare—and ideally more.

Think about it the other way around. If Republicans try to pass legislation that covers 10 million fewer people than Obamacare, most Democrats won’t support it. And then when Obamacare’s funding streams expire, Dems will blame Republicans for the resultant turmoil. On the other hand, if Republicans draft legislation that credibly covers a comparable number of people to the ACA, then it’s Democrats who would look stubborn if they refuse to play ball.

The argument is sound, but that said, the process argued for here to repeal and delay is steeped with risks.

Roy argues that the GOP would have leverage to force at least 7 Democrats to join the Republican effort to replace Obamacare…but is such leverage realistic?

Consider this scenario: the GOP repeals much of the funding for Obamacare, and basically promises that the exchanges are not going to extend past 2019. What then is the incentive for insurers to stay on the exchanges? Many have already been hemorrhaging money, but willing to stick it out in hopes of establishing a long-term viable marketplace. With that incentive gone, there is no reason for them to suffer through the losses entailed. The death spiral of the exchanges are likely to accelerate, rather quickly.

By 2018, what would the exchanges look like in this scenario? My guess is that most of the major players would exit by the end of 2017, basically leaving consumers with few if any choices for health care. This, in turn, likely would increase the rate of premium cost increases, further increasing financial pressure on the middle class.  In that environment, who would have the leverage…Republicans or Democrats? I would argue the latter; with elections nearing, Democrats would lay the blame for the entire mess on the Republican Party, and would have legitimate claims to do so.  They would have no incentive to compromise until after the midterm elections.

Even if the GOP survived with a slightly larger Senate majority after 2018, what are the chances that Democrats would side with Republicans on a plan that would eliminate abortion coverage?  That would narrow Medicaid expansion?  Destroy the individual mandate? I find the likelihood of that exactly the same as when I was asked in late 2009 what the chances were that Republicans would join Obama in the ACA effort: slim to nil.

Note that Chuck Schumer, the new Democrat Senate Leader, has been quite clear on this front:

“We’re not going to do a replacement,” Schumer said of the Senate Democratic caucus. “If they repeal without a replacement, they will own it. Democrats will not then step up to the plate and come up with a half-baked solution that we will partially own. It’s all theirs.”…

Asked directly if Democrats would refuse to support anything that falls significantly short of the ACA in terms of expanding social welfare, Schumer said: “The odds, after they repeal without any replacement, of us sitting at the table to do something that will chop one arm off instead of two is very small.”

Why wouldn’t we take him at his word on something like this?

The irony of this is that as I have gotten attacked for this position, I have gained a powerful and strange bedfellow: President Elect Donald J. Trump. Trump, in his recent press conference, basically promised a repeal and replace strategy, not just one relegated to the former.

Mr. Trump appeared to be unclear both about the timing of already scheduled votes in Congress and about the difficulty of his demand — a repeal vote “probably some time next week” and a replacement “very quickly or simultaneously, very shortly thereafter.”

But he was clear on one point: Plans by congressional Republicans to repeal the health law now, then take years to create and implement a replacement law are unacceptable to the incoming president.

Trump understands that the political risk of leaving the ‘replace’ portion of health care reform is steeped with major political downsides for him.  If he is going to take this on, far better the does it swiftly and quickly, instead of letting the issues drag on over time, because time is not his friend.

The questions surrounding what a conservative health care plan would look like remain the same today as they were in 2009: will the Federal government subsidize health care? Will it continue Medicaid expansion?  Will it protect people with pre-existing conditions? Will it maintain coverage for young people under their parent’s plan until age 26? Will their be a mandate to buy insurance, or will you use other methods, such as continuous coverage mandates, to guarantee everyone has some basic level of insurance?

James Capretta of the American Enterprise Institute lays out the obvious tradeoffs involved in any health care reform…and these tradeoffs will not change over time:

To succeed in this effort, however, House and Senate Republicans, as well as the incoming Trump administration, must dispense with wishful thinking. There is no plan for replacing the Affordable Care Act (ACA) that is without political controversy. Whatever they do will involve trade-offs, and in some cases they will be attacked by their political opponents for doing what is necessary but perhaps unpopular.


Further, there is no silver bullet for reforming health care that will solve all the existing problems. Health-care policy is complicated and does not lend itself to simple solutions. What’s needed most of all is the discipline of a well-functioning marketplace. Getting there will require many changes, in public insurance, employer plans, Health Savings Accounts (HSAs), and the individual insurance market. While Medicare changes can be addressed separately from other reforms, it will not be possible to replace the main provisions of the ACA in incremental, piecemeal bills, as has been suggested by some in Congress. An effective ACA replacement plan will need to ensure that changes in Medicaid, the individual insurance market, and employer-sponsored plans work well together to provide insurance options for the entire non-elderly population. That will happen only if these changes are made in one coherent reform plan so that interactions among various provisions can be understood and anticipated.

Republicans must also drop their ambivalence about embracing the goal of providing a ready and reliable pathway to insurance for all Americans. It should be self-evident, and not at all controversial to acknowledge, that health insurance is a necessity of modern life. Only the very affluent can afford to pay the cost of treating many forms of cancer without health insurance, and no one is immune from cancer, or a costly accident for that matter. Moreover, households with low incomes will never be able to pay the premiums for health insurance without governmental assistance.

The questions go on and on…and don’t get any easier with time. There are costs and benefits to every one of those policy decisions, and all come with political risks.  Republicans are extremely risk averse when approaching these issues, but ultimately there is no way to escape from that; Democrats learned that lesson all too well in the years after ACA passage.

While the GOP appears ambivalent to take on these issues head on, and deal with them immediately…Trump, for better or worse, does not. Now that he has come out in favor of immediate replacement, Speaker of the House Paul Ryan and others are lining up to do just that, regardless of their concerns.

There are ways Republicans can limit their immediate downside risk. For one, they can grandfather current ACA plans, to reduce disruption in the market. They can stabilize the Medicaid system, while continuing to move forward on much-needed long-term reforms of the program. They already appear to be moving full speed ahead on reforming the tax code to provide more equal treatment of benefits under the law, while giving more access to Health Savings Accounts across the board.

Simply put, if the Republicans have meant what they have said for the past 8 years regarding the Affordable Care Act, this is the time to put up or shut up. Donald Trump has taken the first step in this process by staking his flag upon immediate repeal and replace. It is time for the Republican Party to live up to the same promise.


America: The Land Of Bubbles


Another central moment in society, another political controversy.

Last night, Hollywood held their annual Golden Globe Awards ceremony. During the average year, I would avoid watching this somewhat like I avoid a prostate exam or root canal.  I can think of few things that annoy me more than a bunch of elitist actors and Hollywood producers drinking expensive champagne, wearing $10, 000 dresses and million dollar necklaces, congratulating themselves on their own theatrical glory. But my wife begged me, and well, I acceded.

But last night, they found a new way to annoy me.

Forget that fact that the award show spent three hours, and not a single, competent joke regarding Trump was made. I mean…isn’t Donald Trump the easiest comedic target in modern history? How can a room full of entertainers tell three hours of bad jokes about Trump? Yet, this group pulled that fantastic feat off.

Then, it got worse.

Meryl Streep, receiving a lifetime achievement award for the 97th time, took the opportunity to spend several minutes lecturing America about how evil and destructive our next President of the United States is.

You can read the transcript here, and you can find the video almost everywhere.

The first problem with Streep’s commentary was somehow trying to portray those in the hall listening to her as victims.  Streep started her commentary by stating the following: “You and all of us in this room really belong to the most vilified segments in American society right now.”

Really?  Do those people in that hall (who probably have an average net worth in the tens of millions of dollars) really consider themselves the most vilified segment of America?  Trump spent months attaching illegal immigrants, and even a fair number of legal immigrants. But those millionaires are the real victims?

Then, to compound her arrogance, Streep doubled down on her condescension of middle America:

Hollywood is crawling with outsiders and foreigners. If you kick ‘em all out, you’ll have nothing to watch but football and mixed martial arts, which are not the arts.

This, to me, was the most out of touch statement in her entire speech. First, it presumes there are not immigrants working in football (or other sports)…which is clearly false. Second, it shows the bubble in which entertainers live in. They believe their artistic foray is the only one that matters, that is relevant, that is important.

Let us note a fact: The Golden Globes was CRUSHED in the ratings by a first round NFL playoff game yesterday.  The Golden Globes received 9.76 million viewers last night. The Giants/Packers game? 34.28 million viewers.  The arrogance (and ignorance) of Meryl Streep is quite apparent.  And Hollywood would pray for the time of advertisement numbers the Super Bowl would get, let alone a early playoff game.

That said, what bothered me most was not her opinion of Donald Trump. As a long time former member of the #NeverTrump allegiance…I agreed with many of her opinions of our new Commander-in-Chief.  And even the environment which she chose to lecture the American electorate about her opinions was not all that offensive to me (though it is kind of strange to watch the 0.00001% talk as if they are victims in our society).

No. What bothered me is how ineffectual her argument was, and how little Liberals have learned about the Trump phenomenon over the last year.

If lecturing America about how dangerous Trump’s rhetoric can be was effective, or that his character is not fit for the Oval Office, Trump not only would not have won the Presidency…he wouldn’t have ever won the Republican nomination. Jeb Bush, Marco Rubio, Ted Cruz and all the other Republican candidates spent months screaming that message, to no avail. Hillary Clinton did the same, along with $500 million or more in advertisements, and still lost the Electoral Vote.

Now, it has become a cottage industry in conservative circles to become outraged when Liberal Actors do or say something ignorant or stupid. But again…Streep’s comments were less ignorant than they were simply foolish.  I made this comment on Twitter as I was listening to Streep’s diatribe:

Now, maybe we shouldn’t expect anything more from Hollywood, who has time and again proven they are completely tone-deaf when it comes to Trump’s appeal to Middle America.  But many mainstream journalists sat up and applauded Streep’s speech. Those who have followed Trump for the last two years should know that such a spectacle only emboldens Trump, and makes his devout followers love him more. The fact that these journalists don’t realize that Trump was ecstatic to get this kind of attention boggles my mind. After more than a year of Trump, have they not learned that every time one of these incidents happen, Trump comes out on top in the end? Its almost as if they still haven’t accept the reality of this past year’s election cycle.

But this is larger than Meryl Streep, or Hollywood; let us look at the larger picture. Time and again, we have controversies like this where two large segments of America think they are totally, 100% right, and the other side is clueless and lost. This is the problem we have in this country today; both sides live in bubbles, echo chambers of media and news in which we have a feedback loop which convinces us our view point is the only viewpoint with any significant basis in truth.

The reality is Meryl Streep is not fully wrong in her comments. Trump can be a danger to the country…we should never fool ourselves otherwise. But Streep and others, by dismissing his entire movement as evil and racist, do the country a disservice. Instead, maybe they should look in the mirror, and accept their own failures. Furthermore, by dismissing entire large swathes of the population who were open to Trump’s message, they further distance themselves from the very people whose opinion they are trying to convert…that is a level of stupidity I cannot fathom.

Hollywood’s blind support of liberal causes will, year after year, give them less and less clout on the political stage. Streep is a perfect example; does anyone, anywhere, believe her speech changed a single mind? I profoundly doubt that is the case. All it did was enforce pre-existing notions about our enemies across the aisle, further enforcing the bubbles we live in.

Someone, at some point in time, is going to have to be able to burst those bubbles. At some point, if there is going to be a successful voice in uniting America in a common cause, regardless of which side of the political aisle they come from, some leader is going to have to be able to go to Middle America, into Hollywood, into inner cities, into churches across the United States, and be able to give a message of unity and hope.

But as of now, considering all we continue to see, I remain pessimistic that such an individual with those skills and messages will be seen any time soon.