Capretta and Levin in WSJ

Jim Capretta and Yuval Levin have a piece in yesterday’s WSJ arguing that the implementation of Obamacare is still uncertain, and suggesting states should not move to set up exchanges.

Their primary argument is that talk of inevitability of the law’s implementation is designed to force states to move ahead, and they are trying to provide a political counterweight to that. They conclude:

President Obama won re-election and Democrats maintained control of the Senate this month, but the states hold the future of ObamaCare in their hands. Knowing the harm the law would do to their citizens, to the economy and to American health care, governors should refuse to become its enablers.

In public policy, the counter factual (as compared to what) is the most important thing to allow one to evaluate a choice. If not Obamacare, then what? Jim and Yuval provide the following:

Instead of following the Obama administration’s plan, states should seek real reform. For example, they should demand that Washington transform the federal portion of Medicaid for non-disabled and non-elderly beneficiaries into a uniform block grant, with state discretion over eligibility and benefits. The goal should be to turn Medicaid into a premium-assistance program rather than government-run insurance. Medicaid could then be used to help people enroll in mainstream insurance plans. This is the way to help the low-income uninsured get the same kind of coverage as other Americans.

I think this is a reasonable idea in the context of implementing exchanges and later moving in this direction. In my book I suggest federalizing the cost of the dual eligible portion of Medicaid and moving over time to buy low income persons into private insurance via premium support, after the exchanges are up and running. We don’t use the exact same language in describing our proposals, but there is some convergence of policy interests, if not political understanding (I understand this to be a follow on step to implementing Obamacare exchanges, they say you have to get rid of the first do this, which really makes no sense to me).

Both Jim and Yuval have written fairly comprehensive visions of what a replacement of Obamacare would look like, and a proposal for Medicare reform, respectively, so they have ideas. What they lack are members of the House of Representatives (that Republicans have controlled for 22 months and will continue to do so next Congress) who are willing to commit to the myriad details necessary to begin to transform these ideas into reality.

Imagine if at sometime during the past 22 months the House Commerce committee had marked up and reported out a bill to do what they describe above on Medicaid reform? Or marked up the Patients’ Choice Act that has been around for over 4 years so we could see what the CBO thinks about the relative impact of a weak individual mandate versus auto-enroll procedures for risk pooling? And they could say we hate the exchange regulations in the ACA, here is how we would do it? Then a far more concrete negotiation about next health reform steps would be possible.

It is easy to write a paragraph in an op-ed. It is very hard to write a bill that can withstand the bright light scrutiny that such a proposal would entail. Some Conservative critics of Obamacare have some decent ideas, they just don’t seem to have politicians committed enough to push for them via the legislative process.

similar post cross posted at freeforall

Author: Don Taylor

Don Taylor is an Associate Professor of Public Policy at Duke University, where his teaching and research focuses on health policy, with a focus on Medicare generally, and on hospice and palliative care, specifically. He increasingly works at the intersection of health policy and the federal budget. Past research topics have included health workforce and the economics of smoking. He began blogging in June 2009 and wrote columns on health reform for the Raleigh, (N.C.) News and Observer. He blogged at The Incidental Economist from March 2011 to March 2012. He is the author of a book, Balancing the Budget is a Progressive Priority that will be published by Springer in May 2012.

21 thoughts on “Capretta and Levin in WSJ”

  1. When I was young, I never attributed stupidity or bad faith to my adversaries without really strong evidence to the contrary. Now that I am old, I still think that this is a good general policy. But it really doesn’t work for Movement conservatives, their “policy” hacks, or almost anybody who writes on the comics page of the Wall Street Journal.

    Reading the op-ed, that Capretta and Levin pretty clearly view “nothing” as a good counterfactual. They may have come up with reasonable policy analysis elsewhere, but not here. Don is struggling mighty hard to find some policy sense in a spittle-flecked screed that thinks states should be “sparing their citizens from the job-killing employer mandate and from assaults on their religious liberty.” (For this sentence to make simultaneous grammatical and policy sense, corporations must be citizens–more than mere “people, my friends.” After all, ACA’s so-called infringements on “religious liberty” operate on employers, not employees.)

    Don is seeking good faith where none exists. He should quit trying.

  2. As far as I can tell, state government is the least accountable and most corrupt level — the federal government is large and visible; and local government is close and visible. State government is not so close and it isn’t all that clear what it does. Lots of opportunity for mischief and cronyism. Which is probably why Republicans like it so much.

    So, sure, let’s let the federal option kick in in as many states as possible, and especially Republican-governed states.

    Guess what, with all the gravy involved, I bet it doesn’t happen.

    1. It’s happening as we speak, Larry.

      Here in Ohio, Kasich has announced (and his pet GOPlican legislature confirmed) that oHIo will have no part of forming a State-based exchange. There will be no exchanges south of the Mason-Dixon line, either.

  3. As far as I can see this is just sort of cowardly insurrection talk without putting the insurrection name to it. “We don’t have to obey the law just ’cause we lost the election ’cause we are the real Americans.”

    In any event, I suspect all this jibber jabber about states not setting up exchanges, defying the mandates of Obama care, etc. will soon collapse under the local pressure of hospitals and Docs who see they are getting a whole lot less money than the states where cooperation is going on.

    Talking points, not reality.

    In other words, what Larry said above about gravy.

  4. Gee, a couple of hacks suggest on the WSJ Op-Ed page (motto: some honesty might be permitted if it doesn’t get in the way of our narrative and if nothing else will work) that now that he’s won the fight in Congress, in the Courts, and at the flipping ballot box, Obama should pitch the whole thing in the trash in favor of Paul Ryan’s wet dream of an inadequate “premium support” plan (also known as “coupon care”, and guaranteed to leave more people further in the lurch every year than the year before) with eligibility and benefits left up to the tender mercies of the states rather than federally regulated. Because we can totally trust the Randians and Social Darwinists that control the most benighted Red States not to enact their treasured vision of Letting The Poors Starve In Their Hovels Or Better Yet Die Untreated On The Streets.

    I’m sorry, why exactly were we supposed to refrain from abusing these jerks and treating similarly the people – like you – who purport to take them seriously, and insist we must do so as well?

    1. You can’t pick your adversaries or their strategy….I see the key goal of the second Obama term is to get Red States to implement the ACA. Politically, that will likely require putting their fingerprints on the law in some way, which will require some policy changes. Of course the details of any deal are important. The alternative is to accept that some states will be far behind others and may not implement at all or very poorly to the detriment of the health of people in those states. Neither option is without problems.

      1. Our adversaries don’t want people insured, and their strategy is to say no to everything, and to sabotage everything they can if it happens anyway. There is no point in attempting to “reach out” to people who publish a flagrantly insulting op-ed in the always-ludicrous WSJ editorial pages. Their suggestion literally is that Obama should adopt Ryan’s comically evil “plan” instead of the one he worked with Congress on for over a year, got approved by the Courts, was re-elected on, and is working to implement. And you seem to think we should look for good ideas and for good faith in these jokers?

        I realize you’re paid to discuss policy questions in a courteous manner. But are you paid to be a fool? Are you paid to ask us to be fools?

        1. Yes. Don, I find your response to have two parts that are in tension. You say that, if we don’t alter the ACA to produce Red-State buy-in then the Red States will drag their feet on implementing the ACA and will wind up far behind others to the detriment of the health of people in those states, so we should let those states put their fingerprints on the law and give them greater control over its implementation (through block grants). But the issue is that the governments in these states don’t want to implement the ACA, at best out of pique and most likely because they really don’t agree with its goals.

          So giving them more control would… lead to them dragging their feet on implementation and winding up far behind the others, to the detriment of the health of people in those states. Except that by changing the law, we’d have dragged the Blue States back to their level a bit. At least with the ACA in place there’s a mechanism by which Red States can join the rest of the country when they get over their hissy fit and realize that insuring poor people is good for their budget.

      2. mr. taylor, i can assure you that my governor, rick perry, would be delighted to see that portion of medicaid you describe turned into a block grant. you will be astonished at how few people qualify for those benefits, how impoverished those benefits will be, and how high the administrative costs of that program will be. you cannot possibly be as naive as you sound. warren terra has won this argument because it sounds like he’s actually been paying attention to what the republicans have done and said.

  5. Mostly, I ditto what Ebenezer said (as usual.)

    I have a theory, which is untested. It is that intentions matter when you make policy. People who in their hearts really don’t care if others get insurance, and who believe government should have no role in it, will not and cannot come up with good ideas about coverage. I do not believe it is at all likely. They may make noises that sound reasonable, but it’s always the details that matter. If they really wanted to see Medicaid recipients get into Kaiser, or what-not, they’d say so. “Premium support” + block granting = shenanigans.

  6. “For example, they should demand that Washington transform the federal portion of Medicaid for non-disabled and non-elderly beneficiaries into a uniform block grant, with state discretion over eligibility and benefits. The goal should be to turn Medicaid into a premium-assistance program rather than government-run insurance. Medicaid could then be used to help people enroll in mainstream insurance plans.”

    Temporarily pretending that I think it’s a good idea not to presume bad faith here, is there any mechanism at all that ensures that the states will in fact give Medicaid-eligible people enough premium support that they can actually purchase mainstream insurance? Because my guess is that the first thing that would happen is that the same states that are currently holding their breath and refusing to take free money so more of their citizens can have Medicaid will find other things to do with their block grants than actually providing their poorer citizens with adequate insurance.

    1. I would be immensely surprised if Texas did anything constructive with a Medicaid block grant. That is also why I totally opposed Romney’s suggestion that the Affordable Care Act be repealed and let the states sort out the issue.

    2. The details of course are the key, but the key aspect of what I was noting is federalizing the dual eligible and LT disabled portions of Medicaid. Then I think there are good reasons to move to insure the more numerous (and much cheaper on a per capita cost basis) low income elderly Medicaid beneficiaries via private insurance. It would do away with a layer of cost shift and add more folks to exchanges. I share concerns about what some states will do with any type of insurance option, but the key political and policy goal of the Obama second term is to get red states to implement that ACA, and I think it will eventually take some sort of deal for this to happen.

      1. “private insurance … would do away with a layer of cost”
        You are aware that this is contrary to the experience of, basically, everyone everywhere, right?

        Look at here in the USA: the most effective and efficient healthcare systems are the VA (single-provider, and highly regarded) and Medicaid and Medicare (single-payer). Medicare has overhead a fraction of its private competitors.

        Lest we forget: we’ve already done the experiment. It failed. Medicare Advantage was set up as the partial privatization of Medicare. We were told that by outsourcing the provision of Medicare benefits to private insurers we’d get better customer satisfaction and lower cost. Precisely the opposite happened, as everyone warned it would. Private insurers operating within Medicare Advantage were paid the per-Medicare-enrollee-cost for everyone they signed up, even though their population was, for a number of obvious reasons, younger and healthier than the typical Medicare enrollee – a dynamic the insurers enhanced by offering extra benefits (such as health club subsidies) that were of interest only to younger and healthier applicants. Within a few years, and even with a starting population cherry-picked to include the cheapest people eligible for Medicare, the insurers were pleading poverty and threatening to dissolve their programs (much as they’d have liked to, they were forbidden to evict individual beneficiaries against their will when their care proved expensive). Eventually, the problem was solved by providing an extra subsidy to providers of Medicare Advantage, above and beyond the normal per-enrollee cost of Medicare, even as the Medicare Advantage providers continued to target the more active and healthier members of the eligible population. The ACA abolishes this subsidy – rightly so, as it exists only to waste money on the failed remnants of what once purported to be a cost-saving exercise – and Obama has received no end of grief for exactly this “cut to Medicare”.

        So now you’d resurrect and expand this boondoggle? Why should the horse sing this time?

        1. I agree Medicare Advantage (and its predecessors) are failures as cost savings mechanisms due to selection, made even worse by explicit over payment to expand enrollment later. Moving from administrative fee plus payment toward true competitive bidding within Med Advantage offers the best hope of ending the overpayment. I don’t think we will ever abolish private options in Medicare for political reasons. Further, single payer couldn’t more than 40 votes in the U.S. House of Representatives.

      2. ¨.. the key political and policy goal of the Obama second term is to get red states to implement the ACA.¨
        I thought the key policy goal is to implement ACA as fully as possible nationwide. A model that´s obviously working outside the New Confederacy will be the strongest argument to voters inside it. Cutting deals with the Confederates will weaken ACA in the great majority of the country. Taken with the bad faith already pointed out by others, and the billions of free money glinting on the table, there will a lot of pressure on the holdouts to cave.
        Further, I can´t see what´s in your chimerical deal for Obama, who holds the high cards and the electoral mandate. Meanwhile, before he wins, many poor Texans will suffer needlessly. Omelettes and eggs and all that. Obama´s and Michelle´s long view – the long view of Douglass, duBois, and Luther King – has always accepted the need for civilian casualties along the road to equality.

        1. I think of what I said and how you put it as the same thing (key is to get ACA implemented). The 10 or 11 net donor states will move quickly to set up exchanges, do Medicaid expansion if applicable, etc. We need to figure out how to bring this about in the other states, and I think what is in for Pres Obama is he believes in moving towards universal coverage and wants to hasten the pace towards it. I agree with many up the comment chain that the Medicaid expansion will be done eventually by many/most fence sitting states, but I do worry about whether the federal exchanges will work as well as reasonable state run ones….of course could be better than poorly run state ones. There is also a looming litigation about the flow of tax credits via federal exchanges that I suspect the govt/IRS will win, but the default is a few states racing ahead and some lagging. I don’t think it is tenable long term for health reform to be only the purview of one political party, and further don’t think the hardest work of addressing costs will ever be taken until both parties have their fingerprints on it.

          1. Isn’t there a lot of wisdom in the line about never interfere when your opponent is committing suicide?

            Look, I feel for the poor SOBs who live in the red states, but it’s clear that trying to placate the fools in charge of those states will, ultimately, punish their victims further. The fastest way to fix the red states is to let them continue to sail backwards while the rest of the country moves forward.

            It’s not like the 1850s, where it was somewhat difficult for the people trapped in those states to know that life wasn’t like that everywhere. Inadequate as it is, the ACA is a huge advance for the blue states; let the red states sit it out and content themselves with “Right to Work” laws and the low-tax/low-service model for a while; given these internetz thinggies, the people in the red states will get the point pretty fast and start voting their interests instead of the interests of the oligarchs, and before you know it, we’ll be able to make progress in a whole bunch of areas, not just health care.

          2. the only way you will get the republicans fingerprints on health reform is if you allow them to strangle it in its crib. you really are incredibly naive, aren’t you.

  7. Yeah, why give premium support for individuals who are already on a decent and damn cheap health insurance plan, especially once you have removed the Dual-eligible (SNP populations) and long term care patients from the state cost pools? Are you trying to drive up public costs or increase rentier income?

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