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August 19, 2013 9:43 AM Health Reform Made EZ

By Ed Kilgore

Since Republicans seem to be determined to re-litigate the entire debate over the Affordable Care Act of 2010, it’s more helpful than ever for progressives to simplify why the core provisions of that law made sense then and now—or for that matter, in the 1990s and the 2000s, when Republicans were supporting similar reform proposals. Paul Krugman gets the job done in three paragraphs:

Start with the goal that almost everyone at least pretends to support: giving Americans with pre-existing medical conditions access to health insurance. Governments can, if they choose, require that insurance companies issue policies without regard to an individual’s medical history, “community rating,” and some states, including New York, have done just that. But we know what happens next: many healthy people don’t buy insurance, leaving a relatively bad risk pool, leading to high premiums that drive out even more healthy people.
To avoid this downward spiral, you need to induce healthy Americans to buy in; hence, the individual mandate, with a penalty for those who don’t purchase insurance. Finally, since buying insurance could be a hardship for lower-income Americans, you need subsidies to make insurance affordable for all.
So there you have it: health reform is a three-legged stool resting on community rating, individual mandates and subsidies. It requires all three legs.

Today’s Republicans oppose all three “legs” of the stool, yet claim to want to eliminate discrimination against those with pre-existing conditions, an exceptionally popular idea. As Rick Ungar explained at Forbes back in 2011, there are a limited number of ways to do that:

There are only three choices if we wish to make health care coverage available to those who already have a medical situation in their past or present;:Mandated coverage to create a reasonable pooling opportunity for the private insurance companies as legislated in the health care reform act; government operated high-risk pools as proposed by the GOP; or inclusion of those with pre-existing conditions in the private insurance pools without mandated coverage, causing premium costs for everyone to skyrocket to the point of being unaffordable by 99% of all Americans. Clearly, option three isn’t really an option at all.
If you oppose mandated health care coverage, the high-risk, government operated pools are the only remaining way to go. You should, however, be crystal clear on a few points - the existing pools have always failed to be of much value because they are terminally underfunded. As the funding proposals of the GOP to date are woefully inadequate, it seems more likely than not that this proposal may be far more political in nature than a good faith or realistic effort to solve an important problem. You might also keep in mind that pushing the medically uninsurable into government operated programs would be a substantial step forward in increasing the involvement of government in health care.

So whenever Republicans are pressed into explaining what they’d do about the fundamental problem of people shut out of private insurance markets, they either tout these “risk-pool” ghettoes as though nobody’s tried them before, or change the subject to various ideas for reducing health care costs generally, such as “tort reform” or interstate insurance sales. This last idea, BTW, would by its very nature destroy state-based community rating as insurers flock to the states with the fewest regulations.

So for all the complexities of health insurance, and of the Affordable Care Act when you look at its many aspects, the basics really are pretty simple if you focus on the central issue of how to insure the currently uninsurable population. Conservative critics of Obamacare haven’t gotten any more persuasive in their claims that there are better and cheaper ways to deal with that issue, and on most days, they don’t even try.

Ed Kilgore is a contributing writer to the Washington Monthly. He is managing editor for The Democratic Strategist and a senior fellow at the Progressive Policy Institute. Find him on Twitter: @ed_kilgore.

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