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As part of our Election 2012 series, political scientist and sociologist Theda Skocpol analyzes the health care proposals of the Democratic and Republican presidential candidates, and what the election could mean for the future of the Affordable Care Act.
Should the United States expand health coverage and prod the system toward greater efficiency? Or should government retrench and unleash market forces? In our chapter on health reform in the recent Russell Sage Foundation book Reaching for a New Deal: Ambitious Governance, Economic Meltdown, and Polarized Politics in Obama’s First Two Years, Lawrence Jacobs and I highlighted the enormity of the legislative achievement represented by the Affordable Care and Patient Protection Act of 2010. This comprehensive effort seeks to expand health insurance coverage to more than thirty millions additional Americans, and also puts in place strategies and experiments to reduce rapidly rising costs in the U.S. health care system.
Of course, the law and other Obama reforms sparked fierce conservative opposition. Far-right popular and plutocratic forces have since taken control of most of the Republican Party’s agenda going into the 2012 elections. For heath care in the United States, this raises the stakes as Americans are about to head to the polls in one of the most pivotal general elections in memory. Republicans, including presidential nominee Mitt Romney and vice presidential nominee Paul Ryan, are not only committed to repealing the Affordable Care Act. They have also promised to slash Medicaid and turn Medicare into a set of voucher subsidies for private health insurance.
Democrats want to use federal powers to expand health coverage and prod insurance companies and health-care providers into more efficient forms of care delivery, while Republicans call for sharp reductions in federal funding for health care and would count on expanded market competition to reduce future costs. The fate of Affordable Care, Medicaid, and Medicare are all at issue in this election. I draw on my own research with Lawrence Jacobs and on many two-page briefs on health care issues spotlighted this October by the Scholars Strategy Network (SSN) to outline the stakes in 2012. (SSN is a nationwide effort to get the voices of civically engaged scholars more fully into the public sphere. It has dozens of two-page briefs sure to interest Russell Sage Foundation devotees, not just on health care issues, but on a full range of social and political topics.)
The Fate of the Affordable Care Act
Especially since the Supreme Court upheld most of the law last June, Obama’s health reform has gradually gained popularity overall. But when asked about the reform as a whole, Americans remain divided, largely along partisan lines. It is a different story, however, when the specific parts of reform are mentioned. By large majorities, including majorities of Republicans, Americans support new rules for insurance companies, subsidies to make insurance coverage affordable for almost all families and businesses, the establishment of state exchanges to allow comparison-shopping for private health plans, and the improvements in Medicare included in ObamaCare.
The most controversial part of Obama’s health reform has always been the “individual mandate,” but the political fireworks rest on deliberately fostered misconceptions. As SSN scholars lay out with calm arguments and compelling evidence, the mandate provision in Affordable Care is not unprecedented and will not hit very many people at all. More than nine of ten will already be insured through Medicare, Medicaid, employer plans, or policies they have bought with help from subsidies provided after 2013 through Affordable Care. Even Americans who are eventually subject to the mandate can choose not to buy insurance and just pay a small fine instead. No one will be coerced to buy insurance.
Will Medicaid Still Be a Vital Lifeline?
As former President Bill Clinton explained in his speech at the Democratic National Convention in early September, the survival and future of Medicaid is also a big issue in the upcoming election. If Democrats hold at least a toehold in Washington, D.C., after 2012, Medicaid is slated to expand as part of the Affordable Care Act’s provisions for extending health insurance coverage to millions of additional low-income Americans. But if Republicans gain control of the White House and both chambers of Congress, they plan radical cutbacks for Medicaid.
Colleen Grogan of the University of Chicago is one of the nation’s leading experts on Medicaid, and she explains the issues in recent briefs for the Scholars Strategy Network. In one brief, Grogan explains that half of all Americans have either benefited from Medicaid in its current form or know someone who has been helped. Medicaid provides health care for poor families and children and helps fund nursing home care for the elderly and specialized services for many disabled people of all ages. Another highly informative Grogan brief details the Republican plans for Medicaid and what they would mean for fiscally hard-pressed U.S. states. According to blueprints already spelled out by Congressman Paul Ryan and endorsed by most Congressional Republicans as well as presidential contender Mitt Romney, funding for Medicaid would be reduced by more than a third over the next decade. What is more, the federal government would leave each state on its own to pay for health care for the poor, elderly, and disabled, even during national economic downturns when state revenues sharply decline. State governments would face draconian choices about which vulnerable groups should be deprived of essential services.
The Future of Medicare
Once Paul Ryan was elevated to become the GOP nominee for Vice President, his budget plans – largely endorsed by Republican presidential contender Mitt Romney – gained new national visibility. Ryan’s plan to restructure Medicare for Americans retiring a decade from now gets the most attention, as Democrats and Republicans clash on the future of this very popular health care program for the elderly.
The new GOP intention to remove Medicare’s universal guarantee of basic health care for older Americans and replace it with vouchers of restricted value has stark human and fiscal implications. As various briefs at the Scholars Strategy Network explain in expert detail, the vouchers would apply to part of the cost of either private health insurance plans or a redefined, residual public program. Analysts find that this approach would reduce the federal government’s commitment only slightly, yet also shift high additional costs and risks onto future retirees and make it harder to limit overall cost increases in national health care spending. The reason is clear: by breaking up Medicare to create insurance company subsidies, the bargaining capacity of the system would be reduced, making it hard to limit price increases for health care services, equipment, and prescription drugs. In contrast, the Obama administration plans to make Medicare more cost effective and use its bargaining power to help reduce costs in the system as a whole.
The bottom line is clear. In 2012, the two parties have contrasting plans not just for health insurance coverage but also for how to make American health care more cost-effective in future decades. Empirical evidence suggests that only one party’s approach has much chance of success.