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Repeal—Now More than Ever

Nov 8, 2010, Vol. 16, No. 08 • By YUVAL LEVIN
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When the Democrats passed their health care reform legislation in March, they assured one another that the law would grow increasingly popular as its contents became better known and its early provisions began to take effect. Seven months later—as those contents have become better known and those provisions have begun to take effect—the law only looks worse, in both substantive and political terms. Its disastrous consequences are already being felt. Voters clearly know it. The case for repealing Obamacare and starting over has never been stronger. 

Repeal—Now More than Ever

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The fundamentals of that case remain what they were back in March. The law will spend a trillion dollars over the next decade and increase taxes by half a trillion; create a massive new entitlement on top of those that are already threatening to bankrupt the government; impose a vast array of new rules and mandates on providers, insurers, employers, and consumers; insert the government in countless new ways between doctors and patients; increase the burden of Medicaid costs for the states; and cause millions of middle class families to lose the employer-based insurance they have today and pay even higher premiums.

Rather than reducing costs, Obamacare will increase national health expenditures by more than $200 billion—according to the Obama administration’s own actuary. Rather than pave the way for entitlement reform, it will take the resources that future policymakers might have used to improve the structure of Medicare and use them instead to construct a new entitlement that will grow more expensive more quickly than Medicare itself. And all of this to increase the portion of Americans who have health insurance from just under 85 percent today to about 95 percent in 10 years, according to the Congressional Budget Office. There are far better ways to contain costs and so increase access to coverage—above all, by increasing the control consumers have over how their health care dollars are spent. Opponents of Obamacare proposed a variety of such approaches this year.

All this we knew, and said, last spring. But today, we know even more about why the law must be repealed. We know with far greater certainty, for instance, that Obamacare will make it very attractive for both large and small employers to stop providing insurance coverage, thereby sending millions more into the subsidized exchanges than the CBO accounted for, and thus sharply increasing the cost of the law and with it the deficit. We know that Obamacare will make it more difficult for many providers of nonstandard insurance (like colleges insuring young students, or employers providing bare-bones plans to part-time workers) to offer coverage. We know that it will drive up premiums—since it has already begun to do so. We know that it will create massive administrative headaches for businesses and consumers—for instance, requiring companies to file 1099 forms with the IRS for any vendor whom they pay more than $600 in a given year, and requiring a prescription to buy over-the-counter drugs with money from flex spending or health savings accounts.

We know that the people who designed the bill and the people charged with implementing it were not aware of a lot of this. Unanticipated consequences usually take a while to present themselves. But in the case of this law, some nasty ones have already become apparent, and it seems that more appear with every passing week. Just imagine the unanticipated complications that would ensue if the legislation’s enormous and unwieldy new entitlement, Medicaid expansion, exchanges, subsidies, rules, and restrictions were to come on line in full. 

We also know how the law’s champions would respond to such problems—with a mix of strident bullying and daft denial. When some companies began to report the added costs Obamacare would impose on them—reports which are required by law—some congressional Democrats threatened to launch hearings to harangue them. When insurance companies explained that the new law was forcing them to increase some premiums, HHS Secretary Kathleen Sebelius sent them a letter warning that the government will not look kindly upon such honesty in the future.

All of these ominous signs point in one clear direction. To avert a monumental disaster and enact real health care reform, Obamacare must be repealed. The law’s design—which points away from consumer-directed health care and toward an entitlement model in essentially every detail—makes tinkering at the edges impossible. Real reform first requires wholesale repeal. And it cannot come too soon.

—Yuval Levin


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