Right Thinking From The Left Coast
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Monday, December 13, 2010

Mandate Down

I’m slowly catching up on today.  I’m sure you’ve heard that a federal judge declared the Obamacare mandate to be unconstitutional.  If this is upheld by the higher courts, it could be a death blow to Obamacare.  Guaranteed issue combined with a lack of mandate is death to insurance companies.  The entire structure, already teetering, could completely cave in.  McArdle:

Democrats were determined to have a law that did everything, or close to it.  They didn’t want some moldy old Medicaid expansion that would just open them up to charges that they only cared about spending more money on poor people.  They wanted to fundamentally remake the “broken” American health care system.  Unfortunately, their idea of doing so was to build a vast, Rube Goldberg machine full of insanely complicated moving parts, itself very likely to break.  If any of those parts doesn’t work exactly as forecast, the whole machine may not only fail to work, it may take out some of the parts of the existing health care infrastructure that were actually working decently well, as we’ve seen with low-wage workers losing insurance coverage for their children.

A lot of the bits of the machine aren’t working as predicted; the legal problems are only one issue.  Proponents naturally think these are just growing pains, while opponents like me are inclined to be more pessimistic.  Only time will tell who’s right, though I must offer one telling point for the prosecution:  I’ve yet to see a major story showing how health care reform is working better than expected.  So far, everything from the claims that Democrats would get a bounce in the polls after passage, to the promises that you could keep your insurance if you liked it, to the legal issues, turn out to have been overoptimistic at best.

We’ve been blogging the slow unravelling of this bill all year.  The disappearance of child-only insurance plans; the special dispensations given to politically-connected businesses to keep their insurance; Congress accidentally canceling their own insurance (only to ignore the law); exploding insurance rates and declining coverage ... it would be comical if it weren’t so damaging.

The more I think about it, the more I think it is possible that SCOTUS will overturn Obamacare.  The argument—and it’s a valid one—is that if the federal government can force you to buy a product on the market, what can’t they do?  Traditionally, social policy has been pursued with a combination of socialized options and taxes/subsidies.  Retirement saving, for example, is encouraged by our government either through Social Security (the socialism option; and not a good one) or taxes/subsidies (tax-sheltered retirement accounts).  Same with encouraging home ownership (government-run mortgage companies and home interest deductions) and higher education (grants, loans and deductions).  I’m not saying these are good policies, but that’s the way they’ve been done.  But Obamacare is fundamentally different.  It is as though the government could force you to invest in an IRA, buy or home or go to college.  Those are wise things to do, as is buying health insurance.  But should the government have the power to force you to do them?

Scalia and Thomas, I’m sure, will vote down Obamacare.  Alito ad Roberts are unknowns but will probably be sympathetic.  Kennedy is a swing vote but has often sided with the Constitution in cases like this.  I would actually put the odds at maybe 50-50 of seeing Obamacare go down 5-4, assuming none of the conservatives is trampled by a herd of bison before then.  And you thought the Democrats were hysterical about Citizens United.

So what happens if SCOTUS does overturn it?  I suspect the Democrats will back on the socialism+incentives.  They may try to make Medicaid available to all (the public option, by any other name).  Of course, Medicaid is already busting budgets and losing providers.  They will probably try to put in a tax break to buy insurance—this being what the Republicans have been advocated for about twenty years.  And they will try to keep the subsidies and exchanges.

Of course, barring a massive resurgence, they’ll have to do this with a Republican Congress.  And when it come to the GOP, I don’t know what’s going to happen because, right now, no one knows what the fuck the Republicans are going to do about anything.  The Republicans don’t know what they’re going to do.  If they’re smart, they may give on those things in exchange for changes to Medicare along the lines of Paul Ryan’s roadmap.  Or maybe take some pages out of Wyden-Bennett to break down the employer-insurance link.  Or encourage people to move to major medical coverage.

Well, it will be a couple of years until this shakes out.  We might have a new President or new Congress by then or Congress may make some changes to the current plan that will make it pass Constitutional muster.  In any case, this could get interesting.  We could have the fun of last year’s debate all over again.

Posted by Hal_10000 on 12/13/10 at 08:32 PM in Health Care  • (0) TrackbacksPermalink
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