Five things I think I think about the next phase of health care reform

March 28, 2017 at 1:13 PM Leave a comment

argument by jon collier

Photo by Jon Collier

This is not the end of Obamacare; it’s the beginning

In a surprising move, Paul Ryan pulled the American Health Care Act, the Republican ACA repeal and replace bill, last Friday.  It had become clear that there was no movement to the left or the right that would garner enough votes to allow passage in the House.  Even if it had passed in the House by moving right, much of that movement was likely to be stripped out in the Senate, where the Republican majority is slimmer, but no less internally conflicted.  The president has stated he is moving on to other issues like tax reform and infrastructure building.

So you might think that health care reform on the federal level is done for now.  Whether that is true or not, it is also pretty clear to me that there is still a great deal of work to do to stabilize and improve the ACA.  Cost constraints are still lacking, and insurance marketplaces at the state level are still suffering from shrinking insurer participation.  While coverage has vastly improved under the ACA, affordability remains elusive if you don’t qualify for a subsidy.

Where are we going next?  Some (including me) are hoping that this opens the door to real bipartisan negotiation.  Here’s the theory.  The Trump administration cares about the appearance of winning, not ideology.  If you can’t work over the Freedom Caucus to get the votes, you go to the Tuesday Group, a group of moderate Republicans.  Perhaps they’ll even appeal to the next group over from them, moderate Democrats, to get onboard for something.

Here are five things I observed from this last round of negotiations:

  1. The Freedom Caucus has a literal interpretation of the phrase “repeal and replace”. All the rhetoric about removing Obamacare “branch and root”?  Turns out it wasn’t simply rhetoric for them.  They believe that Medicaid expansion to childless adults must be removed entirely, because it is enabling able-bodied citizens to get care without working for it.  All the headlines about 24 million more uninsured shocked many of us, but for conservatives was actually not a bad thing, and for some a desired outcome, judging from the rhetoric surrounding the debate.
  2. Loss aversion works. One of the truisms of behavioral economics is that fear of loss is about three times as motivating as desire for gain.  This has been shown over and over again by people like Amos Teversky and Danny Kahnemann in psychology experiments.  Thus, some people didn’t like the Affordable Care Act until they faced the possibility that they would lose coverage if it was repealed.  For the first time in years, public approval of the ACA is greater than disapproval.  (By the way, now that the immediate threat of repeal is gone, I predict those numbers will reverse again.)  If you want people to value something, don’t try to sell it to them; give it to them and then try to take it away (the Classic Coke strategy).
  3. Trying to sneak legislation through in the age of Twitter is like trying to sneak to the bathroom in your pajamas through Grand Central Station. Hiding stuff so you don’t get criticized for it doesn’t work.  Nor does speeding up timelines for the same purpose.  We may have to do this a few more times before people get it, but the old days of passing legislation that hasn’t been dissected under a microscope I think are gone.  There are too many smart people out there with time on their hands and a Twitter following to feed.  They have an immediate platform to do the Roman thumbs up or down on literally everything in view, and are just waiting for something to tweet about.
  4. The emerging centrist view is that we need to maintain coverage for everybody who has it now, but get to cost containment to make the system sustainable. In a previous post, I talked about the hard truths that both sides are avoiding by blaming the other guy.  But what do we do to control costs?  The conservative answer is market forces, and the progressive one is government regulation.  Neither one has a great track record when it comes to health care.  So what’s an industrial superpower to do?  There was funding in the ACA to set up CMMI, and much of their work has been on alternative payment models intended to bend the cost curve over time.  But pragmatically the experience has been mixed for medical homes, bundled payment, and population-based payment.  Rollout has been slower than many would like, and affect too few providers to declare it a success.   I would love to see a real and thoughtful bipartisan discussion on some hybrid possibilities.
  5. And there is no guarantee the next move is toward bipartisanship. Winston Churchill said, “Americans will always do the right thing—after exhausting all the other possibilities.”  If the last twenty years teaches us anything, it’s that governing from the extremes doesn’t work very well.  So you’d think that the next move would be to try to govern from the center.  But this is one of those Clayton Christiansen moments.  Christiansen says that the winners of the last game are unlikely to be the inventors of the new game, since the new game displaces the old one.  The existing game goes like this:
    1. Point out what’s wrong with any plan offered by your opponents, which is much easier to figure out than how to make things work (boring). It also gets a lot more attention on Twitter.    And, the bonus is that you get to go home to your district and tell people you stood on principle, and that everyone else has the morals of a used car salesman.
    2. Foment anger and frustration, and promise that you are the only person capable of breaking through the mess. Do this, while you are all the while perpetuating the mess.
    3. Repeat, and fund-raise.

Both parties have had the chance to be in the majority and the minority in the last two decades, and both have gotten pretty good at the existing game.   It will take a sea change to find the next game that rewards centrist compromise.  Here’s hoping we exhaust all the other possibilities sooner rather than later.

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