Karl Rove’s Health Care “Ideas”

In response to Paul Krugman, and in my office I like to pretend, me, Karl Rove has penned a piece for the WSJ articulating the many Republican ideas for health care reform. Let’s jump right in, shall we?

Many congressional Republicans, such as Oklahoma’s Sen. Tom Coburn and Wyoming’s Sen. Mike Enzi, have long advocated making health insurance completely portable so workers can take their plans with them from job to job. This means giving individuals who buy coverage for themselves a tax advantage similar to the one that employers enjoy when they cover employees. That change also could make coverage more affordable for the self-employed and even universal for all workers.

No arguments. As I mentioned, liberal wonks love decoupling insurance from employment, too. But let’s own a few things. First, this is a massive new tax break for millions of Americans (which I’m fine with), but it will cost a ton of money. So acknowledge that spending billions on health care reform is fine, please. The bigger point, though, is that even with a tax break, millions of Americans with chronic conditions will not be able to buy policies, since guaranteed issue will be removed. So this is great for healthy people, but not so good for sick people, whom health care is ostensibly for.

In the House, Republicans such as Texas Rep. Sam Johnson and Louisiana’s Charles Boustany (a cardiovascular surgeon), want to allow smaller companies to pool their risk to get the same discounts from insurance carriers that bigger companies do.

That’s the whole point of exchanges. It allows everyone who is not employed by a company to give insurance to join together and pool their risk to get a better deal. So… exchanges are good?

Others, including Rep. Marsha Blackburn of Tennessee and Wisconsin Rep. Paul Ryan, want to spark increased competition by allowing health-insurance policies to be sold across state lines, as are auto insurance policies.

Zombie idea – just won’t die. It won’t work. Here’s why. But in short, there will be a race to the bottom where all insurance will be sold from the state with the least regulation and all the problems we have now, like that it’s hard to get insurance unless you’re healthy and don’t need care, will get worse.

ObamaCare reduced the amount families can save tax free for medical expenses; the House Republican Study Committee wants to raise the amount. Paired with health-savings accounts, this can put quality health care within the reach of many more families.

The flip side is that this will raise the out-of-pocket maximums for everyone, which will make care less attractive to many. Can we also acknowledge that the people that care most about “tax-free” savings are the people who usually have the least trouble getting insurance and care?

Defensive medicine—the use of unnecessary tests and procedures to ward off malpractice suits—cost Medicare and Medicaid an estimated $55.6 billion in 2008, according to a 2010 study in Health Affairs. Thus Texas Rep. Lamar Smith has championed medical liability reform at the federal level to rein in junk lawsuits, despite qualms that the issue should be left to the states.’

Another zombie idea. Defensive medicine is real, and I actually agree with Mr. Rove on the number he used. But tort reform will not fix this problem. It hasn’t worked in Texas, nor will it work everywhere else.

Texas Reps. Mike Burgess (who practiced obstetrics and gynecology) and Joe Barton have introduced bills to establish transparency in pricing and medical outcomes so patients can compare the costs for procedures at area hospitals and their relative success in performing them.

Transparency is great, but not sufficient. Not by a long shot.

Louisiana Rep. Bill Cassidy, also a physician, has introduced a bill that would allow Medicaid patients to convert the value of their government benefit to pay for private coverage.

Many states already run Medicaid through private insurance companies. Also, the same troubles will arise for the poor that arise for everyone else. They can only get coverage if they don’t really need care. Also, the Obama administration is fine with this as part of Obamacare (see Arkansas). I imagine Rep. Cassidy doesn’t want to expand Medicaid, though, which means no more people covered.

None of these are new. You can see that I’ve already posted and written about all of these. Some of them are zombie ideas in that they sound great, don’t work, and yet no one seems to care.

No matter what Mr. Rove says, however, none of these constitute real reform. None of them will significantly decrease the number of uninsured in this country. None of them will help people with chronic conditions to get care. We may lower spending, but by making things worse for the people who need care the most. It’s easy to insure people who are healthy; it’s also cheap. That’s not the point of the health care system, though. Real reform tries to get care to those who need it most. That’s much harder, and it can cost more money, but that’s what we need.


UPDATE: It has been pointed out to me that Mr. Rove also made a mistake about the malpractice number. The Health Affairs study he cites estimates the cost of defensive medicine as about $55.6 billion for the entire system, not just for Medicare and Medicaid. I knew that, and missed it. Sorry! We’ll see if Mr. Rove corrects that, too.

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