Obamacare: The Pinnacle of Two-Party Hypocrisy

With a Trump presidency coupled with a GOP Congress on the near horizon, changes in health care reform are finally on the table. Other than those with preexisting conditions, many on the left haven’t been thrilled with Obamacare but will defend it as a “step in the right direction,” presumably toward universal health care or a single-payer system.

The right didn’t initially respond with pointing out what was actually wrong with Obamacare, somehow feeling the need to engage in hyperbole until the real flaws became so prevalent it was no longer necessary.

Most people are not familiar with the evolution of the idea of a mandate. Many know the Heritage Foundation’s Stuart Butler published “Assuring Affordable Health Care for All Americans” in 1989, but much less known is what began in 1971.

Steven Pearlstein reported in the Washington Post in August 2009 how President Richard Nixon was facing the possibility of running against Ted Kennedy, an opponent armed with a proposal to extend healthcare to all Americans. Nixon countered with an idea for requiring companies to provide health plans for employees and federal subsidies for low-income workers.

Pearlstein recalls:

“After Nixon won reelection, Kennedy began a series of secret negotiations with the White House that almost led to a public agreement. In the end, Nixon backed out after receiving pressure from small-business owners and the American Medical Association. Kennedy himself decided to back off after receiving heavy pressure from labor leaders, who urged him to hold out for a single-payer system once Democrats recaptured the White House in the wake of the Watergate scandal.”

Health care reform torpedoed by special interests? Shocking, isn’t it?

Later proposals also touched on the concept of universal health care. Avik Roy wrote in Forbes in February 2012:

“…a piece of legislation passed in 1986 by a Democratic House and a Republican Senate and signed by Ronald Reagan called the Emergency Medical Treatment and Active Labor Act, or EMTALA…. one of the great unfunded mandates in American history, required any hospital participating in Medicare…to provide emergency care to anyone who needs it, including illegal immigrants, regardless of ability to pay. Indeed, EMTALA can be accurately said to have established universal health care in America—with nary a whimper from conservative activists.

Eighteen years later, Butler advocated the “new” idea of a mandate, transitioning from employer to individual. Notable “conservative” contents in his proposal included as the first objective that “all citizens should be guaranteed universal access to affordable health care.” The remedies center on the requirement to “mandate all households to obtain adequate insurance.”

Other similar ideas followed, however. Roy adds:

“In 1991, Mark Pauly and others developed a proposal for George H.W. Bush that also included an individual mandate. While others credit Stanford economist Alain Enthoven with the idea, Enthoven’s earliest published reference to an individual mandate was an indirect one in the 1992 Jackson Hole paper.”

Enthoven’s association of academics and industry figures, called the Jackson Hole Group, became more involved in 1992 and 1993 as some Republicans in Congress, seeking an alternative to Hillarycare, used these ideas as a foundation for their own health-reform proposals.

A curious succession of support and opposition ensued. Republicans supported it, then opposed it; Democrats opposed it, then supported it — and finally we got a result when the Democrats controlled Congress and the White House: the Patient Protection and Affordable Protection Act.

A timeline for the evolution of this law shows a curious consistency of inconsistency:

1972: President Richard Nixon (R) asked Congress to implement an employer mandate while negotiating with single-payer advocate Senator Ted Kennedy (D-Mass). Nixon resigned and Kennedy pulled support after Watergate.

1986: A Democratic House and Republican Senate passed EMTALA as part of COBRA, requiring hospitals accepting Medicare to treat any patient and allowing those who have lost their jobs to continue buying health insurance through their old employer’s group plan.

1989: The Heritage Foundation published Butler’s plan, also known as “A National Health System for America.” Similar ideas continued into the early 1990s.

1991: Milton Friedman, in a Wall Street Journal article, advocated replacing Medicare and Medicaid “with a requirement that every U.S. family unit have a major medical insurance policy.”

1993: President Bill and First Lady Hillary Clinton tried to pass the Health Security Act amidst staunch opposition from conservatives, libertarians, and the health insurance industry. Though the plan relied on “managed competition” concepts based largely on ideas developed by the Jackson Hole Group, they opposed Clinton’s plan because it combined aspects of a single-payer system.

Individual health insurance mandates were also featured in two bills introduced by Republican lawmakers, including the Health Equity and Access Reform Today Act (HEART) of 1993. Support included Senators Orrin Hatch (R-Utah) and Charles Grassley (R-Iowa), who today oppose the mandate under current law.

1994: In a budget analysis, the Congressional Budget Office said the Heritage Foundation “substantially revised” its proposal.

Meanwhile, Switzerland passed the Swiss Federal Law on Health Insurance. This law instituted mandatory healthcare insurance and an optional insurance scheme to compensate for the loss of daily earnings. The health insurance provides for payments in case of sickness, accidents (unless covered by a separate accident insurance policy), and maternity. The law went into effect in 1996.

2006: Massachusetts Governor Mitt Romney signed off on a state law requiring residents to purchase individual health insurance. Romney favored the individual mandate only but the Massachusetts legislature overrode his veto of the employer mandate and it was included as well.

The Netherlands also adopted a model based largely on the work of Jackson Hole’s Enthoven.

2007: A bipartisan Senate bill, the Healthy Americans Act (HAA), authored by Senators Bob Bennett (R-Utah) and Ron Wyden (D-Oregon) contained a mandate. A 2008 preliminary analysis by the Congressional Budget Office concluded it would be “essentially” self-financing in the first year that it was fully implemented. The bill did not advance and was resubmitted in 2009 with the same result.

2008: Senator and presidential candidate Barack Obama expressed opposition to a mandate requiring all Americans to buy health care insurance.

2009: Many Republicans and libertarians argued that provisions including individual mandates are “unconstitutional.

2010: A Democratic-controlled Congress passed the Patient Protection and Affordable Care Act that put into place an individual mandate along with other provisions. President Obama signed it into law. Some two years later, its constitutionality was upheld by the Supreme Court.

Butler himself explains his change of heart and as far as his reasoning goes, he seems to be on shaky ground with some overly general justifications:

Republicans supported (the individual mandate) then opposed it, Democrats opposed it then supported it

1) Behavior economics now indicate many people will enroll on their own so we don’t need a mandate;

2) Risk adjustment tools have made voluntary insurance more stable; and

3) Today, mandates are more about what’s good for government than the people.

More believable is the valid argument from some naysayers on the right who say they changed their minds because Obamacare does not resemble Butler’s original idea or the Swiss model.

Butler added:

“I agree with my legal colleagues at Heritage that today’s version of a mandate exceeds the constitutional powers granted to the federal government. Forcing those Americans not in the insurance market to purchase comprehensive insurance for themselves goes beyond even the most expansive precedents of the courts.“

Or it could be because it suddenly had Obama’s name on it.  You be the judge.

There is little doubt the mandate could have been implemented in a much better, simpler way. Democrats might well ask themselves exactly what motivated their leaders to change the Swiss model or earlier ideas into the law we have.

The common talking point is the right was for it before they were against it. Partially true, but the left was against it before they were for it. Both caricatures miss the subtleties of the argument, which look something more like this:

The left has wanted universal health care and a single-payer system. Democrats took an idea from a conservative think tank that resembles what some — including Forbes columnist Avik Roy — consider the best healthcare system in the world, and added a few hundred pages of other stuff to create the PPACA.

The left thinks this is a step in the right direction.

Meanwhile, a conservative think tank and others had written about an idea with some support and some opposition from the right — a plan that resembles an acclaimed system abroad. Barack Obama, previously opposed to a mandate, reversed course and championed the PPACA, an individual mandate with many caveats.

After that, Republicans showed universal opposition, but couldn’t do anything until recapturing the House. They then voted to repeal the new law approximately 50 times and used defunding and shutdown tactics in an attempt to derail it but failed to offer any alternatives along the lines of what Butler offered to begin with.

And here we are.

Today, Americans are divided not just on philosophical grounds, but by the reality that many individuals who could not get health insurance before Obamacare are now able to, while millions of others saw things get dramatically worse.

The latter — and a failure to address the problems — is no doubt a big part of what helped Donald Trump win the election and kept the GOP in control of Congress. Now, it will be time for them to put up or shut up, and the Democrats will be in a peculiar situation: improvements will be good for people, but bad for their party.

The GOP played that game and won. It’s just unfortunate our leaders are playing politics with people’s lives.

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