The standoff in Washington over extending temporary, COVID-era subsidies has brought the structural failings of the Affordable Care Act (ACA) back to the forefront, leading some Republicans to conclude that the moment is ripe to push for serious, structural health care reform.
While congressional Republicans are generally united in resisting the Democratic effort to use the crisis to force the extension of the Biden administration’s subsidies, there is clearly a divergence between those urging deep, fundamental changes now and those open to temporary compromises.
For many conservatives, the debate over subsidies highlights the failure of the ACA, widely known as Obamacare.
The New York Post Editorial Board recently wrote that Obamacare was a “calamity from the start,” arguing that it “raised taxes, destroyed the old… private insurance market and slapped all kinds of requirements on insurers, spiking costs”.
They argue that blindly tossing fresh trillions down that hole is “nuts” and that Congress needs a “better, fairer, cheaper and more workable system”. The paper urged Republicans to seek “deep Obamacare reform,” as the system needs to be “saner, cheaper and more sustainable”.
Merrill Matthews, resident scholar with the Institute for Policy Innovation, a research-based, public policy ‘think tank’, writes in The Hill that there is simply no point in trying to fix Obamacare.
He argues that the current government shutdown highlights the choice Congress faces: “Keep pouring taxpayer dollars into a failing, unaffordable health care system, or take this opportunity to fix the structural flaws driving costs ever higher”.
Matthews says that subsidies that Democrats insist be extended, only “mask rising costs” and that Obamacare is “the primary reason costs are rising”.
“Republicans want changes that would reduce health care spending, making it more affordable for everyone and less of a burden on taxpayers,” he argues.
Matthews outlines several key options for reform that go beyond mere budgetary maneuvers.
First, he highlights the waste in Medicare and Medicaid fraud, which is so widespread that “organized crime” sees the programs as a “cash cow”.
Second, Matthews suggests implementing a site-neutral payment policy—paying the same rate for the same service no matter where it is provided—to curb consolidation and save billions.
Matthews also urges insurance reform, stating that people should be allowed to buy policies that best meet their needs, including short-term or limited-benefit plans, by repealing the ACA’s restrictions.
One area that he suggests would bring about real change for the consumer would be to allow individuals to place tax-free funds into Health Savings Accounts, providing economic incentives for individuals to become “value-conscious consumers”.
While some Republicans are eager to immediately pursue these changes, others suggest a temporary extension of subsidies to keep the ACA “on life-support” while structural fixes are found. However, reports indicate that some Republicans are ready to “offer their own plan instead of another ObamaCare subsidy enhancement”.
Describing Obamacare as an “insanely complex, low-quality, high-price, cost-shifting scheme,” which has only worsened over time Matthews concludes, the only way to please consumers and reduce health care spending is to allow the insurance and drug markets to work again – as markets.