If you want a sustainable budget, stay the course with Pres. Obama

I have an op-ed in today’s Durham Herald-Sun newspaper arguing that the re-election of President Obama increases the chances of a deal that will put us on the path to a sustainable budget. It is reproduced below. This will be a familiar argument if you have read my book Balancing the Budget is a Progressive Priority.

***

By Donald H. Taylor Jr., Herald-Sun guest columnist

The fate of Obamacare and the direction of the next step in health reform is the clearest choice in the presidential election.

Obamacare has already expanded insurance coverage to young adults by allowing them to remain on their parents’ insurance, and it will begin the setup of state-based markets (think Orbitz.com) in which the uninsured and those working for small businesses can purchase private insurance coverage with income-based subsidies. North Carolina will have the choice of expanding Medicaid in financially advantageous terms if we wish to do so (the Supreme Court said states could not be forced).

Obamacare contains many efforts that begin changing the way we pay for care — policies that if tried, evaluated and implemented, could help us address cost inflation while improving quality.

However, the hardest steps on cost containment will never be taken so long as health reform remains the policy of only one political party. Eventually, there has got to be a deal that makes both political parties responsible for taking the hardest steps.

Re-electing President Obama and moving forward with Obamacare will provide the conditions under which such a political deal is most likely to occur, yielding the best chance for the best health policy.

Gov. Romney is in many ways a hero of health policy, having achieved near universal coverage in Massachusetts; his plan is the pattern for Obamacare. He now says that he will repeal and replace it on day one of his presidency, and that is the clear sentiment of the Republican Party.

When viewed purely in policy terms, Obamacare represents a moderate track, and not the single-payer system that many liberals want. The part of Obamacare that is most offensive to Republicans is the Obama part.

If Republicans record a clean sweep in this election (presidency and both houses of Congress), they will be able to repeal the vast majority of Obamacare. However, there is no reason to believe they will get around to the replace part. It is not that they don’t have ideas on health reform. They do. What they lack is the political will (it takes 218 votes in the House, 60 in the Senate, months of discussion) to push a reform through from scratch.

When was the last time the Republican Party invested political capital to push a health reform effort that would expand insurance coverage while addressing costs and quality? There is no example.

There is a tremendous amount of policy work that must be done in Washington in the coming weeks and months on taxes and spending, and the scope of the tax and spending changes that happen by default mean that the time will be ripe for a large-scale deal, one whose inevitability has been delayed only by the election. If we can identify some modifications of Obamacare that are to the liking of Republicans in the midst of these broad negotiations, and while doing so make the hardest work of health reform the responsibility of both parties, then we have a reasonable chance of moving toward a sustainable budget over the next decade.

If the first step on health reform is back to nothing via repeal, then I fear that will be the last step for some time. And we have no hope of a sustainable budget without consequential health reform because health care costs are our biggest long-run spending problem.

If you want a sustainable budget, the best course of action is to stay the course and re-elect President Obama, in large part because he already has a health reform vehicle that provides many great steps and is flexible enough to accommodate the inevitable next ones.

Donald H. Taylor Jr. is an associate professor of public policy at Duke University and author of “Balancing the Budget is a Progressive Priority.” He blogs at http://www.donaldhtaylorjr.com. Taylor has contributed financially to the Obama campaign and has canvassed, but this column was not seen by anyone else and he is not a policy adviser to the campaign.

About Don Taylor
Professor of Public Policy at Duke University (with appointments in Business, Nursing, Community and Family Medicine, and the Duke Clinical Research Institute). I am one of the founding faculty of the Margolis Center for Health Policy, and currently serve as Chair of Duke's University Priorities Committee (UPC). My research focuses on improving care for persons who are dying, and I am co-PI of a CMMI award in Community Based Palliative Care. I teach both undergrads and grad students at Duke. On twitter @donaldhtaylorjr

4 Responses to If you want a sustainable budget, stay the course with Pres. Obama

  1. David says:

    I am a former powerful supporter of Obamacare, turned very lukewarm supporter. I think I was foolish for assuming Obamacare is the right course of action for this country. Yes, I believe we have a moral obligation to ensure that a majority, if not all, of the population is insured. I applaud Obama as a man who values this ideal. It’s the moral thing to do – but does this really make it the right thing to do?

    Simply using common sense… Medicaid is in shambles – how does it make sense to add millions to medicaid financially? Yes, for states it seems like a no-brainer – the federal government takes care of all expansion costs! But, long-term, how does this make sense financially for the nation/federal government??? Part of me now believes that Obamacare will do wonders for the very poor (which is great) but raise premiums on the middle class. Liberals and Obamacare supporters (like myself) used to always post about the CBO and Jon Gruber showing how much cost savings and lower premiums Obamacare would bring us. Jon Gruber in the past year has COMPLETELY reverse coursed on his statements and has come out with literature saying that premiums in many many many states will not only not fall but also rise by 10-20%!! The COB has recently come out and predicted that the costs of Obamacare will be 25% greater than originally assumed.

    We accused Republicans of picking and choosing when they thought the CBO was credible based on whether the findings supported Obamacare or not – we can’t do the same. And now liberals seem to act like Jon Gruber has fallen off the face of the earth after he was one of the most oft-cited supporters of Obamacare. I’m a conflicted progressive who is unsure what to think about Obamacare because of these reasons. I was wondering what your thoughts are regarding all this.

    • Don Taylor says:

      David
      our political system produces messy outcomes. Obamacare was what could pass, and has some great features but much more is needed, and as I say we will only do the hardest parts of cost with both sides bearing some responsibility. Big picture stop and think what Rs are likely to do on health reform? Historically speaking, nothing. We need a deal to modify the ACA, and from the basis of the ACA one is plausible. If we start by going back to nothing, I am not optimistic.

      On the cost of insurance, there are two things to keep in mind. What is covered (benefits) and what the premiums are. If someone has a bare bones plan (say 2 out of 10 on some measure of benefit expansiveness) and pays $200 per month, and after ACA has a more expansive plan (7 of 10) but pays more than $200 per month, that is an increase in premium, but they also have an increase in coverage. In an individual market of today or plan provided by small employer, the ACA level of benes (7) would cost much more than it does in the individual or small group market.The ACA also allows higher deductible plans that most people seem to forget https://donaldhtaylorjr.wordpress.com/2012/05/17/high-deductible-plans-in-the-aca/ Also, the degree to which what you describe is true is going to be driven partly by what states decide as they have decisions and flexibility with regard to benefits and exchange structure. So, you could find different outcomes in different states….but that is part of the idea of allowing states to develop some of the mechanisms.

      This isn’t the same as the overall net cost of the ACA….CBO hasn’t greatly expanded their cost estimate of the overall/net cost of the ACA.

      My book lays outs what I claim to be the way ahead and what a bipartisan deal would look like between Dems and Repubs. email me and I will send you one. This post outlines big ideas https://donaldhtaylorjr.wordpress.com/2011/09/06/balancing-the-budget-health-reform/

  2. Pingback: Why I take the N.C. election personally « freeforall

  3. Pingback: Why I take the N.C. election personally « The Reality-Based Community

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