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The Failure of RomneyCare

Former Massachusetts governor and likely 2012 presidential aspirant Mitt Romney has been on the wrong side of the defining political battle of our time.

Mr. Romney claimed earlier this month on “Fox News Sunday” that the Massachusetts health reform plan he signed into law in 2006 is “the ultimate conservative plan.” But there are many similarities between it and the ObamaCare loathed by conservative voters.

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Nancy’s Nutty Rules

The next act in the drive to pass ObamaCare is the mother-of-all political maneuvers — in which Democrats will use an incredibly convoluted and possibly unconstitutional process.

Things were already arcane: President Obama, House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid have been threatening to enact “health-care reform” through the narrow path of budget reconciliation. It’s a ploy to allow the Senate to pass “reform” with just 51 votes — making the election of Scott Brown as the 41st senator against ObamaCare irrelevant.

To use reconciliation, Pelosi must first get House members to vote for the exact bill the Senate passed in December. That is, the House would “keep the process moving” so both the House and Senate could pass a second bill to fix things members don’t like in the Senate measure.

But the speaker is having trouble rounding up the 216 votes she needs to get the Senate bill through the House. Her members rightly fear that the Senate might prove unwilling or unable to pass the “fixed” bill — and, at the least, would have a huge advantage in negotiations over just what “fixes” to make.

The problem is straight out of a 7th-grade civics class: If both houses of Congress pass identical bills, the bill can go to the president to be signed into law.

House members are being told that they must vote for the Senate bill as a procedural step. But the bill would then be only a presidential signature away from becoming law. That is, House members might end up voting for the Senate’s Cornhusker Kickback, Louisiana Purchase, “Cadillac” tax, abortion coverage and other unpopular provisions — and then find it’s all become law.

The risks are plain enough that Pelosi doesn’t yet have the votes: Her members fear they’ll be left hanging to defend their votes for the hated Senate bill.

So now Democratic leaders say they’ll package a two-for-one vote: Moving the original Senate bill simultaneously with a “reconciliation” bill — thus, if the House votes for the bill of fixes, the main Senate bill will be deemed to also have passed. Then the reconciliation bill will go back to the Senate, where it only needs 50 votes (plus Vice President Joe Biden’s) to pass.

Hmm. Nowhere in the US Constitution does it say that Congress can deem a bill to have passed. Pelosi & Co. aren’t just making up policy as they go, but also procedure — possibly unconstitutional procedure, at that. All to enact a bill remaking a sixth of the US economy over the 3-1 opposition of the American people.

Reform but Start Over

President Obama is missing an opportunity to embrace a genuinely fresh approach to health reform.

Instead, after a year of debate in Congress and the Blair House summit, we’re left with the same partisan proposals that are hugely unpopular with the American people, involving:

• Hundreds of billions of dollars in tax hikes;
• Job-killing mandates on individuals and businesses;
• Huge cuts to Medicare; and
• Onerous government regulations that will make it harder to get the medical care we need.

According to independent experts, if the bills before Congress were to pass, health spending will continue to rise, premium costs will increase, people will lose the coverage they have today, and access to quality care will suffer as doctors and hospitals become insolvent.

But Speaker Nancy Pelosi is not daunted. She is trying to convince her rank-and-file members to swallow hard and pass the Senate bill so it can then be “fixed” through reconciliation. They have to vote for the Cadillac tax and giveaways like the Louisiana Purchase and the Cornhusker Kickback — and trust that the Senate will then go along with removing all those poison pills.

Congress would be better off scrapping these plans and starting anew on a smaller, targeted bipartisan plan to address the real problems in our health sector.

The President is Wrong, Wrong, and Wrong Again

There was absolutely nothing new in President Obama’s much-heralded speech Wednesday. No game-changing ideas. No genuine efforts at bipartisanship. No change in his determination to impose government control over our health sector for decades to come.

Worse, the president repeated the arguments he’s been using for a year, which have been proven wrong by numerous independent studies. Take just three examples from his White House speech on Wednesday:

• President Obama: “If you like your plan, you can keep your plan.”

The steep cuts in Medicare Advantage he supports would mean at least one-third of seniors likely could lose their comprehensive Medicare Advantage coverage as their plans are forced to withdraw from the program, cut their benefits, or raise premiums. In addition, at least 10 million people with employer-sponsored insurance could lose their current coverage, according to the Congressional Budget Office.

Mr. Obama himself acknowledged at last week’s health reform summit that “8-9 million people…might have to change their coverage.”

• President Obama said his plan will “bring down the cost of health care for millions—families, businesses, and the federal government.”

The Congressional Budget Office has reported that health insurance premiums will continue their steady upward climb under the Senate bill. Families purchasing insurance in the individual market would see an increase of $2,100 in the year 2016, over and above increases they already will be facing. That means those families would be paying $15,200 in 2016 for health insurance if the Senate bill passes, and $13,100 if it doesn’t.

Families that get health insurance through small businesses will be paying $19,200 in six years, and those working for large firms, $20,100.

PricewaterhouseCoopers released a study, commissioned by America’s Health Insurance Plans, which showed the cost of a family plan in 2019 would be $4,000 a year higher if reform passes.

And Chief Medicare Actuary Rick Foster estimates that, under the Senate bill, “Federal expenditures would increase by a net total of $279 billion” between 2010 and 2019. So his plan would cost families, businesses, and the federal government more, not less.

• President Obama said his plan “brings down our deficit.”

Congressional leaders hammered the CBO into submission as they drafted their legislation, using the CBO’s scoring tactics against them to pretend the legislation reduces the deficit.

But former CBO Director Doug Holtz-Eakin concludes the bills “can claim to be deficit-neutral only because during its first decade it offers 10 years of taxes compared with six years of subsidies. “The Republican staff of the Senate Budget Committee estimates that, fully implemented, Democratic legislation would cost $2.4 trillion over 10 years, nearly three times the cost projected by the Congressional Budget Office,” Holtz-Eakin said. This would significantly expand, not shrink, the deficit.

Further, CBO shows the Senate bill double-counts Medicare savings. Savings to the Medicare program “would be received by the government only once … they cannot be set aside to pay for future Medicare spending and, at the same time, pay for current spending on other parts of the legislation or on other programs.”

Medicare Chief Actuary Richard Foster made the same point: A series of accounting maneuvers makes it appear that Medicare’s Part A trust fund would be in better shape under the Senate bill that is the basis of the president’s plan, but that’s not so. “In practice, the improved Part A financing cannot be simultaneously used to finance other Federal outlays (such as the coverage expansion under [the Senate bill]) and to extend the trust fund,” Foster wrote.

Further, Foster said, making the cuts to Medicare that the Senate bill requires in order to get its deficit score would “represent an exceedingly difficult challenge.”

So just on these three examples—keeping your current coverage, lowering costs, and reducing the deficit—the president is wrong. It is though he simply dusted off the same speech he has been giving for a year, using arguments that have been proven as inaccurate by independent studies and analyses, and hoping that maybe, just maybe, this time the speech will work.

The president and his aides may twist arms and torture Congress into passing ObamaCare, but the more he forces this through, the more the American people are going to reject being force-fed a health plan they strongly oppose.

Discarding Facts and the Will of the People

The president’s determination to enact his collectivist health-reform agenda at any political cost despite overwhelming public opposition is unprecedented in modern times.

Today, Mr. Obama is expected to say he will not heed the will of three-quarters of the American people who either want Congress to stop work on health reform altogether or start over, and will instead tell Congress to charge ahead through the minefield of budget reconciliation to pass a bill that will put one-sixth of our economy under government control.

Rational arguments and facts are discarded. When Rep. Paul Ryan (R., Wisc.) detailed at the summit the budget gimmicks in the bills that would put executives of private companies in jail, the president just brushed past his remarks and said he “disagrees.”

That means Mr. Obama disagrees with the Congressional Budget Office and the chief Medicare actuary whose analyses are based upon the facts of his double-counting of Medicare savings, ten years of taxes with six years of spending, creation of new budget-busting entitlements, one-fifth of Medicare providers going out of business and jeopardizing care for seniors, and health-insurance premiums rising even faster if the bill is passed than if not.

The president’s offer to adopt four Republican ornaments, including one very bad idea by Sen. Tom Coburn, is a joke. Senator Coburn’s idea to send federal undercover agents into doctors’ offices to pose as patients is a police-state tactic that will compromise care for every patient and make it even more difficult for new patients — strangers who might be federal plants — to get appointments.

The White House clearly has no new ideas. The president is expected to ask the Senate to twist its rules to force its health-overhaul legislation through a process designed exclusively for budget and spending-related issues. These are desperate, hard-ball political tactics.

In order to move the president’s process forward, House members who fear for their political lives will be forced to vote for a Senate bill that they hate. That means they will have to vote for a bill that contains the Cornhusker Kickback, the Louisiana Purchase, the Union Payback, and liberal abortion language. And then they must trust that the Senate can fix it through a second reconciliation bill that also must pass both houses of Congress, followed by a likely third piece of legislation to address changes that can pass through reconciliation. That is going to require an unprecedented level of trust that no one has seen on Capitol Hill in a very long time.

The American people are doing everything they can to stop this. If Congress manages to pass this before the Easter Recess as planned, the uprising during Easter recess town-hall meeting will make August look like a children’s tea party.

The Coming Health Fight

The White House expected a slam-dunk at Thursday’s health summit — another tour-de-force by President Obama that would convince rank-and-file Democrats in Congress that the time’s come to push the reform bill through. That didn’t happen — but the push is still on.

The president’s advisers seemed to expect the Blair House event to repeat President Obama’s triumph at last month’s House Republican retreat in Baltimore. But there, he was on stage, flanked by flags and behind a microphone and podium looking down on Republicans who were sitting around tables at lunch.

The staging there put that GOP crowd at a disadvantage, subordinating substance to style. Thursday’s gathering was a different story.

With the president and members of Congress all around a table talking with each other as equals, it was clear that Republicans held their own on health care — an issue they’re clearly taking ownership of. They got far less than half the airtime, but still succeeded in making coordinated arguments on behalf of a step-by-step approach to reform.

The summit was not the game-changer the White House hoped it would be. Will the adminstration go to “plan B,” and support a smaller (though possibly still bad) bill that can draw GOP votes and command solid majorities in both houses?

Or will it continue to insist on passing a wildly unpopular, comprehensive overhaul of one-sixth of our economy that three out of four Americans reject?

The president opened the summit by saying that Republicans and Democrats aren’t far apart on health reform because they share concerns about growing deficits and rising health costs. But the debate showed the two sides have very different approaches to solving those problems.

The president’s plan and the House and Senate bills rely on more regulation and scores of new government programs to control our wayward health sector. Republicans believe in providing incentives for more competition, consumer choice, and price transparency to force changes in the marketplace.

Thursday’s dialogue helped the American people see the wide ideological differences — and made it plain that Republicans simply don’t believe it is possible to fix the Democrats’ bills, because the specter of government control is woven into their fabric. Democrats, meanwhile, strongly distrust the market and will never agree to the competition-based ideas that are integral to the Republicans’ reforms.

Both sides walked out just as they walked in, disagreeing fundamentally on the best approach to health reform.

So what’s next? Senate Majority Leader Harry Reid is determined to use the budget-reconciliation process to jam ObamaCare through the Senate — but that requires huge exertions from House Democrats.

Speaker Nancy Pelosi needs to convince her rank-and-file members to swallow hard and pass the Senate bill so it can then be “fixed” through reconciliation. They have to vote for the Cadillac tax and giveaways like the Cornhusker Kickback — and trust that the Senate will then go along with removing all those poison pills.

If Pelosi had the votes, the bill would be on the floor in a day. She doesn’t.

The summit didn’t move the needle. Yet the White House remains absolutely determined to pass this legislation — so we await the next act.

Democratic leaders realize they may be unable to muster the votes to pass their 2,700-page bill; they’re contemplating taking a rifle-shot approach to pass parts of ObamaCare, piece by piece. But that’s at least as risky — because it will take longer, and allow scrutiny on the costs and intrusiveness of each part of their plan.

Health Insurance Reform Should Promote Guaranteed Renewability

The objective of health insurance reform should be to get people to obtain coverage with guaranteed renewability before they become high risk, writes Mark V. Pauly of the Wharton School of Business at the University of Pennsylvania. One step in this direction would be to add guaranteed renewability for coverage of a worker’s family to small-group insurance. Another would be to implement strong incentives for obtaining coverage before one gets sick. Some of these could be carrots, such as larger subsidies for low-risk people to get them to buy in. Others could be sticks, such as increased premiums for people who decline coverage until they become high risk. The establishment of high-risk pools, adequately subsidized by general taxes but with higher-than-standard premiums and moderately limited coverage, may be all that is needed to get nearly everyone to do the right thing.

Summit Standoff

The consensus among most pundits and reporters was summed up by The Wall Street Journal’s Peggy Noonan in her column today: “Boy, that didn’t work.”

The White House expected a slam dunk, building on what it considered a triumph at the House Republican retreat in Baltimore a month ago, so it could convince rank-and-file Democrats that the time has come to get health reform done.

I was at the retreat in Baltimore, invited to do a session on health reform for members, and was in the room during that remarkable 70-minute exchange.

In the world of cable news, optics are everything. In Baltimore, the president was on stage, flanked by flags and behind a microphone and podium looking down on Republicans who were sitting around tables at lunch. The considerable substance of the dialogue was subordinate to the staging.

Yesterday, with everybody seated around a table at Blair House talking with each other as equals, it was clear that Republicans held their own on health care — an issue that they clearly are taking ownership of. Even though they received less than half the airtime, they used it to make coordinated arguments on behalf of a step-by-step approach to reform.

The summit was not the game-changer the White House hoped it would be.

The question now will be whether there is the political will to go forward with a smaller bill that very likely could pass this Congress, or whether the White House is going to continue to insist on passing a wildly unpopular, comprehensive overhaul of one-sixth of our economy that three out of four Americans reject.

President Obama opened the summit by saying that Republicans and Democrats are not far apart on health reform because they share concerns about growing deficits and rising health costs.

But the debate showed the two sides have very different approaches to solving those problems. The president’s plan and the House and Senate bills rely on more regulation and scores of new government programs to control our wayward health sector; Republicans believe in providing incentives for more competition, consumer choice, and price transparency to force changes in the marketplace.

Politico summed it up well: “So the parties walked out of Blair House almost exactly the way they walked in — completely at odds over the best way to fix the health insurance system. There were modest efforts around the edges to find common ground — on reining in waste and fraud and keeping the deficit in check — but no broad agreements on the shape of reform.”

I was actually in Little Rock, Arkansas, yesterday giving a speech so I watched the summit in pieces — for a while in the Little Rock airport. Late in the afternoon, I saw six or eight traveling businessmen sitting around a bar watching CNN’s broadcast of the summit, clearly interested in the debate. The country still is paying attention. The details matter.

So what’s next? While the focus is on Majority Leader Harry Reid’s determination to use the budget reconciliation process to jam a health reform bill through the Senate, the real drama is in the House.

Speaker Pelosi needs to convince rank-and-file members that they will have to swallow hard and pass the Senate bill so it can then be “fixed” through reconciliation. If she had the votes, the bill would be on the floor in a day. She doesn’t.

The summit didn’t move the needle. That said, the White House still is absolutely, positively determined to pass this legislation, so we await the next act.

What’s Wrong With Congressional Health Bills?

Here is a refresher that may be useful to those attending the Blair House summit to answer those who still insist the Democratic leadership’s bills must be passed so they can “do something” on health reform. The American people know we need reform, but they simply do not want this legislation, as evidenced in the latest Rasmussen poll showing that 61%  of those polled saying Congress should start all over on health reform.

Problems with legislation before Congress:

* Health costs will continue to rise
* Federal health spending will increase
* People will lose the coverage they have today
* Taxes will increase, hitting the middle class
* The bills just don’t work
* The deficit will increase
* Doctors and hospitals will become insolvent
* Job creation will suffer

Read the details at the Galen Institute.

Tax. Spend. Regulate. Mandate.

The much-awaited health reform plan the White House released this morning is little more than an amalgamation of the taxing, spending, mandating, and regulating policies of the bills that passed the House and Senate last year.

Instead of offering a genuinely fresh approach, Mr. Obama split the difference between two bad bills that are hugely unpopular with the American people. He would continue to mandate that both individuals and employers pay for health insurance or face fines and penalties. He would expand Medicaid – the most dysfunctional health program in the country. And he would increase fees on insurers and other health companies which will be passed along to consumers in the form of higher premiums.

The big new idea in the president’s plan is to federalize regulation of health insurance, creating a Health Insurance Rate Authority to conduct “reviews of unreasonable rate increases and other unfair practices of insurance plans.” This reflects the overall strategy to send more and more control over the health sector to Washington.

Mr. Obama clearly is not trying to bridge the divide between Republicans and Democrats as a starting point for a dialogue at the summit on Thursday. A separate document listing Republican ideas he would include focused almost exclusively on policies to crack down on waste, fraud, and abuse – good ideas but not enough.

In fact, the Obama plan snubs the GOP by calling for increased taxes on companies inside and outside the health sector and slapping a payroll tax on the non-wage interest and dividend income of wealthier Americans.  These higher taxes will drive up the cost of health insurance, depress innovation, and delay the economic recovery.

The way the president has dealt with the Cornhusker Kickback, the Louisiana Purchase, and the Labor union exemption is to basically extend the sweetheart deals to others. All states get more favored treatment for expanding Medicaid, and the threshold is raised for taxing high-cost health plans and will be delayed until 2018.

The proposal that the president has outlined will cost even more than the Senate bill and will lead to exploding costs that will surely top its $2.5 trillion 10-year cost.  Health spending will continue to rise, premium costs will increase, at least 24 million people will remain uninsured, and the subsidies to individuals and businesses will continue to allow politicians to pick winners and losers. Because the president’s plan is built upon the Senate bill, it therefore would continue the cuts to Medicare that will jeopardize care for seniors.

The Obama plan is not an improvement and offers Republicans little upon which to begin to build a conversation at Thursday’s summit that could lead to genuine compromise.