Lanhee Chen on Obamacare Alternatives

Source Leslie dela Vega

OZY:

What’s next for the states that said no to Obamacare, and overall on the health care front?

LC:

The big question that is on everybody’s mind is: What are premiums going to look like next year? For states that have operated their own exchanges to date, there are going to be pretty fundamental questions of how big and how robust their marketplaces are going to be. The direct result of that is how cheap or expensive plans are going to be. The second set of issues is how many insurers are really going to participate in these marketplaces if they don’t see profitability? This is where the business side of Obamacare hits the policy side of Obamacare, because if in some of these states businesses pull out because they decide it is just not a profitable endeavor, then you are going to see some real heartache over, “I can’t get a plan I really like. I can’t see a doctor I really want to see. Screw these plans that were theoretically supposed to expand quality coverage.” The third issue is just: What is going to happen to states that have taken the Medicaid expansion? Are they going to be able to continue to afford it? That has always been the big complaint about Medicaid, is that it’s a budget buster. If you look at California’s budget, the single most significant line item is Medi-Cal. If you think about what it is in California that is really driving the train in terms of our fiscal ruin, it is Medicaid.

OZY:

Are there some interesting alternatives to Obamacare out there that you think we haven’t heard much about?

LC:

I think there are a lot of alternatives … [but] people don’t write about them because they don’t think it is ever going to happen. 

OZY:

Let’s say it could happen.

LC:

No conservative likes Obamacare. If Republicans win the Senate in 2014, there are [a few] things we should think about doing…

I think the mistake that Republicans make is this: They forget that the status quo pre-Obamacare was not acceptable. So if we’re going to get rid of Obamacare, we have to talk about the things we also believe in. I think Republicans can and should do a better job of articulating those alternatives, because they are out there and the ideas are out there. We need to figure out: What are the three to five changes to Obamacare that we as conservatives would want to make in order to either transition the pathway towards conservative health care reform, or make Obamacare work the way we as conservatives want to make it work?

My big complaint about Obamacare is not that we have exchanges — I think exchanges are fundamentally a good thing. What I worry about is when you conflate regulator with marketplace. What would it be like if we actually had in states a true marketplace, where plans could compete — based on some minimum standard, of course — but you removed all of the regulatory overlay that Obamacare puts on the exchanges?

The second question is: How are we using the tax code to subsidize health care? In Obamacare, we are using the tax codes the same way we’ve used it for last 60–70 years, and we’re further entrenching the tax system. I would [ask]: What’s one way we could tweak some parts of the way Obamacare deals with the tax system to move us toward a health care system where people have more control and leverage over the health care that they are buying and using?

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