What the election means for health care

This post is coauthored by Steve Pizer and Austin Frakt.

People are asking us, what does the election outcome mean for health care? In short, not as much as many think.

There’s a big difference between campaigning and legislating.  In the campaign, Republican candidates appealed to their base, which was worked up about health reform without much understanding of what it does and how it works (this lack of understanding is broadly held, it’s not just a Republican base thing). The Republican base hates health reform because it’s a symbol of Obama. They think it’s a product of the far left, when in fact it’s chock full of Republican ideas.

But that thinking is of principal relevance to the campaign, not to governing. When the new Republican House majority starts legislating on health care, they will be more concerned with what the relevant interest groups want. The insurance industry, hospitals, and drug companies want looser regulation and lower taxes. That is, the big players want what they always want–more control over implementation and establishment of favorable regulations–even if it’s at the expense of a more efficient health system for the rest of us. But they also want the mandate, which can’t work without the subsidies and insurance reforms.

The ACA began as a moderate Republican reform proposal for a reason: with respect to the fundamental structure of the law, the interest group politics work pretty well. We doubt the House leadership will do anything to alienate the insurers, drug companies, or hospitals. Put it this way, if those interest groups didn’t want health reform of the form we got, they would have killed it last winter, if not before. They didn’t. So the mandate and overall structure of the ACA are safe.

Moreover, if Republicans go hard after health reform, they would be badly misreading their perceived mandate. This election was far more about the economy than about health care. Contrary to what the GOP wants us to believe, only a minority of American favor repeal of the the ACA. Without control of the Senate and the presidency, the furthest the Republicans could push it is to hold up the budget and force a government shutdown over health reform issues. The last time the GOP did that the Democratic president came out looking pretty good.

So what might Republicans do to satisfy their base and remain in the good graces of key health care interest groups? For the base, all the GOP really needs is to be seen in conflict with Obama over health policy. The substance matters hardly at all. The Republicans will not have difficulty doing little and selling it as a lot. Winning is open to definition, so there’s plenty of room for spinning the base.

Looking toward 2012, the role health reform plays in GOP tactics in the presidential campaign may depend on what Limbaugh and Beck and Palin choose to latch onto. They will look for what community organizers call “legislative handles,” which means aspects of an issue that can be crystallized into popular legislation and that are simple enough to sell in 30-second messages. We haven’t heard a convincing anti-health reform legislative handle yet. Other issues are easier: Don’t vote to raise the debt limit!; Insist on extending tax cuts for everyone!; No earmarks! The slogan on healthcare is “Repeal and Replace!,” but that’s not a plausible bill because it won’t satisfy the interest groups. Nor can it pass.

Where does this leave the possibility of improving health care in America? Since the inception of the debate over health reform and through this election the Republicans seem interested in only delay and obstruction. Thus, we don’t see any chance of serious work to improve health care in America under Republican leadership. That does not mean there are not decent right-of-center ideas. There are! We just don’t hear GOP leadership promoting them in ways we believe can pass both houses and be signed by the president. We’d be delighted to be proven wrong!

We would like to see work done on slowing the cost of health care to the government, which would help balance the budget, one of the Republicans’ key issues. There is a good chance, depending on implementation, that Medicare and Medicaid costs could be slowed with ACO-related payment reforms. To accomplish that probably requires more cooperation across the aisle than we’re likely to see. There’s also the Independent Payment Advisory Board, which, if it survives Republican attacks, could make major changes to Medicare payment policy.

The only thing in the law aimed at slowing private premiums is the excise (Cadillac) tax, which also generates much needed government revenue. That won’t kick in until 2018. Politics being what it is, it’s likely there will be proposals to delay it and its effects. But delay is not going to help balance the budget. Nor would be repealing or watering down many other provisions of the ACA. That fact puts Republicans in a tough spot. How would they or could they propose to pay for the dismantling of ACA provisions that are designed to (and CBO-scored as) money saving?

Put it all together–interest group politics, that they can “win” in the eyes of their base by doing very little, and the budgetary effects of removing ACA cost-saving provisions–and it is hard to see how the GOP does a whole lot to undue health reform. So, what does the election mean for health care? On this, our sound bite is: a lot of sound and fury, signifying not much.

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