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Posted at 4:53 PM ET, 11/29/2010

Checking in with health-care reform

By Ezra Klein

Tyler Cowen has a pessimistic take on the early months of health-care reform. Like Tyler, I've upgraded my assessment of the likelihood that Supreme Court attacks the individual mandate directly. My take on that is here.

As for the other pieces, I'm somewhat less concerned. In part, that's because it's very early, and virtually no significant element of the bill has been implemented. But I'm also chastened by my long-ago involvement in a Talking Points Memo blog called "Drug Bill Debacle," which was all about how Medicare Part D was proving to be a disaster. As things turned out, the early implementation was very rocky and provided plenty of rhetorical ammunition to the program's doubters. But the benefit is now working better than even many of its supporters had anticipated. Democrats used to talk about repealing or substantially reforming it. Now they never do.

The main question for health-care reform is less "Will it work?" than "Will it be given a chance to work?" What I'd add to Tyler's list is that the decision to push the bill's start date back to 2014 to get a lower price tag from the Congressional Budget Office is proving a bigger mistake than I'd initially thought.

By Ezra Klein  | November 29, 2010; 4:53 PM ET
Categories:  Health Reform  
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Next: Reconciliation


oh i don't know Ezra but the fact that the high risk pools aren't covering as many as many had hoped and denials to that pool are substantial because the requirements that people be uninsured for 6 months basically made getting into them almost impossible is pretty relevent. Also the fact that the government in its bureaucracy cannot legally change how this is administered is pretty telling as well.

Just like insurance is only as good as when you can use it so too goes for the high risk pools.

not to mention the fact that the costs of the high risk pools are prohibitive.

Posted by: visionbrkr | November 29, 2010 5:14 PM | Report abuse

IMHO, liberals sowed at least one seed in the "unconsitutional" argument when they neglected to include some sort of tax credit for those who do pay for their own insurance. I find it interesting that neither Ezra or any other advocate of the new legislation has ever given serious thought to the inherent problems with subsidizing coverage for some -- either as an untaxed employee benefit or public support -- then requiring anyone who doesn't qualify for such a subsidy to pay for individual care with untaxed dollars. How can it be consitutional to force some people to buy a product in the open market at the same time others enjoy the product tax-free?

Two-thirds of all individual policy holders today are either unemployed or working for companies that do not offer coverage as a benefit and they comprise only one segment that was ignored by those who crafted the legislation. The decision to cast health reform as a poverty program and highlight sob stories alienated the majority of people who actually the option of something better.

Posted by: Athena_news | November 29, 2010 6:21 PM | Report abuse

Visionbrkr: yeah, the six month waiting period for the high-risk pools is terrible -- some states have existing high-risk pools without such long waiting requirements, which helps a bit, but still, it was another of those penny-wise/pound-foolish decisions.

Athena_news: umm, much of what the law does is give tax credits to people who buy insurance on their own. It doesn't do that by just excluding the entire cost of the plan from taxable income, since the employee benefit tax exclusion is already problematic, and for many/most folks on the individual market, an advanceable, refundable tax credit is far better than a deduction.

And I really, really don't see how that has anything to do with the constitutionality of the mandate. The argument for unconstitutionality, as I understand it, is that commercial inactivity, in this case failing to buy health insurance, doesn't count as commerce for the purposes of the Commerce Clause power.

Whether or not the regulation affects different people differently has nothing to do with that challenge -- unless you think there's some kind of Equal Protection claim to be raised because somehow the mandate differently impacts those on the individual market vs. those who have employer-based coverage. But the Supreme Court has been definitive in saying that those sorts of distinctions don't trigger any kind of strict scrutiny, so you'd be left arguing that it was totally irrational for Congress to leave the current tax scheme in place, which seems a very heavy lift.

Posted by: Mike_Russo | November 29, 2010 6:42 PM | Report abuse

oh and there's the little matter still of the 1099 that isn't resolved yet. oh and the fact that dependents to age 26 still in many cases (including the FEHBP to my understanding) aren't covering dependents to age 26 along with many large employers but other than that its working swimmingly. Best running federal program since the Post office!

Posted by: visionbrkr | November 29, 2010 7:23 PM | Report abuse

Our employer subsidized HD plan rates went up 20% this year, the single largest annual increase ever. Our son's individual policy rates went up 25% (his employer doesn't provide a health insurance benefit), and the insurer (Anthem; Blue Cross of California) is becoming much more restrictive about what meds are in the formulary. Thanks Congress!

Meanwhile, the family elders on Medicare received notice of "free" annual physicals and subsidized drug costs for those who hit the donut hole.

Posted by: Beagle1 | November 29, 2010 8:35 PM | Report abuse

The individual mandate is going to be found unconstitutional on one and maybe two counts by a 5-4 vote. SCOTUS will find that the "tax" is really a fine and you can't change that by calling it something else. And they may also find that it is unequal protection.

And then the House will gut funding for the expansion of Medicaire.

And the rest will be gutted in 2013 and what's more, in the process of repeal, the Republicans will go further, removing a lot of existing regulation from the health insurance companies.

Meanwhile health care costs will continue to soar, more and more companies will stop providing health insurance as a benefit, more and more Americans will be uninsured and many many more will be underinsured...

... the crisis will roar back into political prominence on down the road and the liberals will rise to power with a mandate to solve the problem. George Will, if he is still around, will warn the Democrats against overreaching. The House will pass a public option or a single payer bill. The blue dogs in the senate, after 6 or 8 months of kabuki theater, will kill it but will pass some Great Society baloney. The Republicans will win the House in the following midterm (and the lesson will be for the Democrats to be less liberal) ...

... they will repeal the one substitute measure posing as reform and gut the new entitlement...

...the health care crisis will get worse...

...the liberals will rise...

... the blue dogs ...

... the lesson ...

... election...

... repeal ...

... crisis ...

We have died and gone to hell, people.

Posted by: pmcgann | November 29, 2010 9:03 PM | Report abuse

Shorter Ezra: My pundit skills are weak. Tune in tomorrow for more punditry.

Posted by: jamusco | November 29, 2010 9:46 PM | Report abuse

I have posted this already here before You guys should stop complaining because, one the health care we have now isnt as good as it was supposed to be. also the law has just been signed so give it some time. so if u want to say u have the right to choose tell that to ur congress men or state official. If you do not have insurance and need one You can find full medical coverage at the lowest price check .If you have health insurance and do not care about cost just be happy about it and believe me you are not going to loose anything!

Posted by: robertjimeniz | November 30, 2010 12:06 AM | Report abuse

", much of what the law does is give tax credits to people who buy insurance on their own." - Mike_Russo

You are wrong... and your post illustrates the fallacy of having redefined health care reform as "coverage for the uninusred". The tax credits are limited to those within specific poverty guidelines. Middle-class individual subscribers get zero. IOW, very few of the people who are already participating in the individual market will see any benefit beyond rising premiums.

"And I really, really don't see how that has anything to do with the constitutionality of the mandate."

You don't? To say that it affects different groups differently is disgenious since the only people who have to pay for their own coverage are also the only ones not getting any kind of tax benefit. Individuals who bear the full cost of their coverage are penalized today. That may be acceptable when it's a matter of choice but to require them to participate in a scheme with such a penalty is going too far. I don't see how that can be a sustainable and continue to penalize them is not a sustainable policy.

For the record, I am 100% in favor of true *universal* healthcare. The key to successful universal programs though is that *everyone* is treated the same -- which is definitely not true here.

Posted by: Athena_news | November 30, 2010 12:21 AM | Report abuse

I agree that framing health reform as just about the uninsured is bad. But while the specific definition of who counts as "middle class" is a bit vague, those "specific poverty guidelines" you refer to are very broad -- individuals making up to about $44k annually, and families of four making up to about $90k per year, get tax benefits under the law.

And of course the tax benefits are only one part of the help people on the individual market will get from the ACA (through the economies of scale and bargaining power of the exchanges, the mandate bringing in healthier people, etc.) -- CBO found that this would lower the cost of policies by 14-20 percent, even without looking at the impact of the tax credits.

So if the ACA has been positioned as just helping out those in dire poverty and doing nothing for middle-class, that's a failure of messaging and positioning, but not one of policy.

"That may be acceptable when it's a matter of choice but to require them to participate in a scheme with such a penalty is going too far."

Again, that may or may not be true as a matter of equity, but that's got nothing to do with the ACA's constitutionality. Purchasing individual vs. group insurance doesn't put you in a protected class for purposes of the Equal Protection clause, and there's clearly a rational basis.

Posted by: Mike_Russo | November 30, 2010 2:46 PM | Report abuse

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