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June 14, 2012 11:13 AM The Real Missed Opportunity for Stimulus in Health Reform

By Harold Pollack

Noam Scheiber, Jonathan Cohn, Ezra Klein, Kevin Drum, and even Mitt Romney are getting into it regarding whether the White House missed an opportunity to pursue a second stimulus by pursuing health care reform. As a professor, I hate to interrupt the learning experience of students having a useful debate. Still, enough is enough. It’s time for the answer key.

Pursuing health reform was necessary and right. Had President Obama passed on this chance, he would have forfeited a once-in-a-generation opportunity to advance the economic security of ordinary people, and to address the widespread inhumanities and dysfunction of our health care system. Before President Obama leaves office, millions of Americans will recognize the magnitude of this achievement.

The real missed opportunity was the failure–forced by fiscal conservatives at both ends of Pennsylvania Avenue–to embed more effective and immediate help for states, localities, and ordinary people in the nuts and bolts of the final bill. Health reform included many opportunities for a second stimulus. Many of these opportunities were missed, due to the tentative back-loading of the Senate bill that became the core of the Affordable Care Act.

Suppose ACA had included a five-year extension to the COBRA subsidies embedded in the 2009 stimulus. Imagine if ACA had abolished the mandatory Medicare waiting period for individuals who qualify for federal disability programs. Imagine if the bill had allowed each state the option to begin health insurance exchanges as soon as these could possibly be implemented. Imagine if ACA had continued the 2009 stimulus’s highly-favorable federal matching rates for hard-pressed state Medicaid programs.

Each of these measures would have been sound health policy. Each would have accelerated the on-the-ground implementation of health care reform for ordinary people. The Affordable Care Act’s original sin, tentative back-loading of its main pillars, left health reform more politically vulnerable than it needed to be. It also left on the table needed opportunities to provide immediate help to a weak national economy.

Sure, these measures would have been costly. Let’s suppose they would have cost another $75 billion annually for a few years until ACA is solidly-in place.* As far as I can tell, opponents’ post-truth “repeal and replace” talking points about trillion-dollar-entitlements would have been much the same as they are right now. And ordinary people, states and localities, and the national economy would have received more potent help when they most needed it.

The first paragraph of the answer key says, “Back-loading health reform is poor health policy and health politics.” It’s poor fiscal policy, too.

*A friend emails that $75 billion per year forever adds up to…real money. I meant this as a short-term stimulus and transition measure.

[Cross-posted at The Reality-based Community]

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Harold Pollack is the Helen Ross Professor at the School of Social Service Administration at the University of Chicago.

Comments

  • Neildsmith on June 15, 2012 4:53 AM:

    There wasn't any political support among the general public for additional government spending on stimulus in 2010. There still isn't. Americans are getting the economic policy they want (and deserve). You just don't get it.

  • Neildsmith on June 15, 2012 5:09 AM:

    Here is what you don't understand: "I am socially liberal. I was thrilled when Obama recognized a gay couple's right to marriage. I am fiscally conservative. Obamacare scares me,"

    http://www.theatlanticwire.com/technology/2012/06/politics-silicon-valley-obamacare-scares-me/53544/

    This sentiment is far more pervasive that you think it is. And lots of people aren't thrilled with gay marriage either. See Greensburg, IN and North Carolina.

    Sorry for the repeat posting (not that anyone is going to notice).