How the Next President Should Respond to King v. Burwell
In his 1996 State of the Union address, President Bill Clinton proclaimed, "The era of big government is over." That prediction turned out to provide more of a short-term rhetorical evasion than signal a lasting change in the direction of national policy. But after last week's Supreme Court decision in King v. Burwell, it would be more accurate to say: "The era of big lawsuits against Obamacare is over" Nevertheless, several other types of challenges to the future path and pace of implementation of the Affordable Care Act (ACA) remain ahead. As one door closes, others open.
No Remaining Existential Threats in the Courts
ACA opponents invested heavily in two lengthy legal challenges to core provisions of the 2010 health law. Targeting the constitutionality of the individual mandate almost succeeded, but it came up short at the Supreme Court in NFIB v. Sebelius in June 2012. Last Thursday, a statutory interpretation dispute over whether tax subsidies extended to insurance coverage through exchanges established by the federal government, rather than by states, was dismissed by a 6-3 Court majority in King. A handful of cases challenging other aspects of the health law remain. But even if they overcome significant legal hurdles, those challenges do not threaten fundamentally the ongoing implementation of Obamacare. The big battles on this legal front are over.
Politics: More of the Same Hasn't Been Enough
ACA opponents have been more successful at winning Republican majorities in Congress and state legislatures than at actually changing health care policy once in office. Rhetorical pledges to repeal, or repeal and replace, or even significantly revise, Obamacare remain unredeemed. Waiting for major court cases to be resolved, or pointing to the futility of overcoming presidential veto threats, did not hide a more basic problem: lack of consensus over pursuing a serious legislative strategy that offers something better to voters. The run-up to proposing a unified approach on Capitol Hill in response to a better King result showed the limits of current GOP political thinking. Beyond a thin layer of agreement to extend ACA insurance subsidies through other means, oppose current federal insurance mandates, and punt more thorny issues over to a coalition of willing red states, there was not much else to unite Hill Republican factions.
For the rest of the current Congress, don't expect much more than a few more symbolic Obamacare repeal votes that still face procedural roadblocks, or some small-ball measures to trim the ACA's edges, involving such provisions as the medical device tax or the Independent Payment Advisory Commission. Perhaps a full-fledged effort to delay or repeal the individual mandate -- as part of a successful budget reconciliation bill passed later this year -- will at least transfer full political ownership of that liability to the Obama White House, if it forces the president to actually use his veto power to preserve it.
Echoing the Brooklyn Dodgers of many decades ago, Republican officeholders and candidates mostly default to the usual promises to "Wait ‘til next year," or the next presidential election if it comes later. The premise is that a strong leader, who wins an electoral mandate in November 2016, could unify opponents of Obamacare and unveil a plan to repeal and replace the law, starting the very next year.
Such hope may spring eternal, but the limits of history remain more likely to constrain the scope, scale, and pace of change. Most presidential campaigns don't provide a clear referendum on national health policy. Any Republican candidate is unlikely to deviate very far from issuing broad statements of general principles and recycling a litany of ACA-linked maladies. Candidates also have to address a host of other important issues, so don't expect the unveiling of a more detailed plan to change Obamacare comprehensively on the 2016 campaign trail. "Mandates" to make more sweeping changes in settled arrangements tend to be claimed and redefined after getting elected, rather than sought and earned more openly in advance.
At best, a successful candidate promising an end to Obamacare should sketch out a stronger vision for a new direction in health policy. It would not only offer relief from the burdens of the ACA but suggest a better path forward to lower costs and improved health care, and then fill in the many other blanks later!
We did not see very much of that in the 2012 campaign. Will next time be different? Promising to tweak the parameters of tax subsidies for health insurance, defer to state judgments on most health care regulation, loosen the guard rails for insurance benefits choices, widen the rating bands for age-based premium pricing, essentially return to a pre-2010 health policy regime, and then hope for the best may not be stirring enough to overcome resistance to one more wrenching and prolonged round of disruption of the most recent status quo.
The in-box for a new administration will be full of must-do priorities and other competing goals. The ACA will have been in place for nearly seven years by the time the next president takes office. A transition plan to disconnect the many interconnected wires of the law, issue new regulatory guidance, implement another administrative infrastructure, and provide time for almost everyone involved to get from here to there without major upheavals and crippling losses requires substantial skill in planning, communication, and execution. And patience.
One Alternative: Contain, Counterpunch, Convert
Acknowledging these constraints of current political realities nevertheless has to lead to more effective strategies, rather than the cop-outs of resignation and depression. After all, many aspects of near-term implementation of Obamacare remain problematic and prone to create new political counter-pressures. The inherent contradictions and complexities of the ACA already are setting a ceiling on its aspirations and achievements. For example, the second year of exchange-based enrollment has plateaued. Extremely generous subsidies for such coverage can only be stretched so far up the income ladder, to disguise larger hikes in the underlying costs of government-mandated benefits. Immediately over the horizon is the end of several ACA mechanisms -- risk corridor and reinsurance payments -- that allow some participating insurers to offer initially lower teaser rates to attract market share. Further down the political road is the backlash of resentment from other moderate-income workers who do not benefit as much, if at all, from the ACA's highly redistributive subsidies and would prefer to see them spread more widely.
Much of Obamacare's implementation has meant averting a crash of mismatched parts, heading off another collision along uncharted paths, and improvising connections between wires that don't quite intersect. The political tension among the law's critics on the right thus far has remained primarily between more pragmatic business interests who prefer to assist the ACA's faltering trains to run somewhat less erratically and more on-track (instead of running directly over them!) and grass roots onlookers who are rooting for bigger and more spectacular crashes. The more important question remains -- are those trains even heading in the right direction and delivering valuable cargo? Or are they already far too overloaded?
In the near term, greater unity among ACA opponents might be found in efforts to limit the expansion and entrenchment of the law's initial inroads, as well as thwart the far more ambitious plans of Obamacare's original architects. Budgetary constraints through the appropriations process can choke off the ACA's supply lines of discretionary funding, to some degree.
However, building broader constituencies for change must move beyond criticizing, correcting, and constraining the law's implementation and expansion. One clear goal should be to connect consumers more directly with whatever financial assistance they need and their fellow taxpayers can afford, with the bare minimum of intermediate bureaucratic and regulatory filters. Another new one (for ACA critics) would advance "other" less bureaucratic ways to encourage delivery system improvements and help the production and distribution of health care cost and value information that actually gets used by real consumers, practitioners, and payers.
But those aspirations should be converted into more tangible and less nuanced messages. In short, the alternative to future expansion of the ACA is to rearrange, not reduce, its assorted subsidies. They would be distributed in a flatter, less income-sensitive manner; but with far fewer restrictions or requirements on how they are spent. Such a direct-to-consumer approach needs to be enhanced with information to provide health care buyers resources to make expanded choices.
Back up Alternative: Read and Write Between and Beyond the Regulatory Lines
ACA opponents have another set of tools to use in a future White House with different policy goals than further doses of Obamacare. The Roberts opinion in King essentially empowered future rule-makers to think even more creatively when it comes to implementing legislative goals enacted in broad terms. So, any future administration wanting to move in a different direction in health policy might want to consider pushing for a new law that is limited to many fewer words than the ACA. It might simply say, "We should have better, more market-based health care coverage that doesn't cost as much as it could and doesn't tell everyone else how to buy it. The Secretary shall figure out the rest."
Then, that new administration would invest its remaining resources in hiring enough experienced hands who know how to rewrite regulations to get political results. They will be busy for a while, but should not be interrupted until they are done.
