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In the Absence of Conservative Solutions to Health Care

3:10 PM, Mar 1, 2013 • By FRED BAUER
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With New Jersey governor Chris Christie's announcement that he would accept funds for Obamacare's Medicaid expansion, the number of Republican governors accepting Obamacare Medicaid expansion money rises to eight: Jan Brewer (Arizona), Rick Scott (Florida), Rick Snyder (Michigan), Brian Sandoval (Nevada), Susana Martinez (New Mexico), Jack Dalrymple (North Dakota), John Kasich (Ohio), and Christie. Many of these governors rode to power in 2010 on a Tea Party wave and protested vociferously against Obamacare, so their about-face on Obamacare money stokes more than a little ire on the part of some on the right. I am not sure, however, that conservatives should rest content with excommunicating these governors from the Church of True Conservatism and casting them into the darkness of the RINO Establishment.  The acceptance of these Obamacare funds—however tentative—drives home the need for Republicans to offer an alternative health care model.

ChrisChristie

There might be an aspect of political self-interest in these governors' decisions. Many of these governors are from states that President Obama won in 2012.  But it would be a mistake to attribute this decision solely to politics. Mitt Romney carried both Arizona and North Dakota handily, and Republican governors who embrace Obamacare funding likely risk a considerable backlash within their own ranks.  So politics alone cannot explain this conversion. 

On a surface level, there is considerable short-term incentive for these governors to take the federal government up on Medicaid expansion.  For at least the first two years, the cost of expanding Medicaid in states that choose to participate would be borne solely by the federal government, and federal subsidies for this Medicaid expansion could hover near 100 percent for years in the future.  From many a governor's perspective, this is free money (of course, this money ultimately comes from the taxpayer, but it does not come directly from the state budget).  And this money could be used to help the poor of a given state.  As Governor Kasich said in defense of his acceptance of this Medicaid expansion, "And I've got to tell you, I can't look at the disabled, I can't look at the poor, I can't look at the mentally ill, I can't look at the addicted and think we ought to ignore them."  Governor Kasich is far from alone in his belief that such spending, especially if it comes from the federal government, could help private individuals without exhausting the state's treasury. 

The point of this is not that Obamacare subsidies are magical free money or that these governors were necessarily right in their justifications of their decisions.  But what we should recognize is that politicians are, well, politicians.  If an elected official sees the chance for easy money from the federal government, he is very likely to take it—especially if he believes that this money could do real good for his constituents.  So angry conservatives might be wise to emphasize an alternative set of solutions to our health care problems instead of simply denouncing those elected officials who have taken more money from the federal government in hopes of making the best of a dysfunctional health-care system.

Two forces exacerbate the health care crisis in the nation.  One is the vertiginous climb of health care costs.  According to the Kaiser Foundation, since 1980, the per capita spending on health-care in the United States has climbed from $1,110 in 1980 to $8,402 in 2010.  Per capita health care spending almost doubled in the decade between 2000 and 2010.  The rise of insurance premiums tells a similar story.  These increased costs make health care far less affordable for the average family and place renewed strains on government finances.  Some of these increased costs may be due to technological innovation, but they are also driven by various federal and state policies that limit the effectiveness of the marketplace for controlling costs and that provide often misguided incentives.  Tackling health care costs in the U.S. involves far more than fighting over Obamacare.  By charting out a path to encourage more medical innovation and a more efficient delivery of medical care, Republicans could make health care more affordable for private individuals and public entities.

The second factor that is critical for health care and influential for governors debating whether to expand Medicaid is the hollowing out of the middle and working classes over the past decade-plus.  As more Americans fall behind, the public demand for more government subsidies grows—as does the cost of these subsidies.  According to the U.S. Census, the number of Medicaid beneficiaries exploded from about 43 million in 2000 to about 62 million in 2009—over a 44 percent increase.  From an electoral standpoint (to say nothing of an ethical one), declaring that low-income Americans should do without health-care is far from a sufficient answer.  By offering a set of policies that expand opportunity for all Americans and provide a popular prosperity, Republicans could lessen the need for government services such as Medicaid and thereby help stave off a government takeover of health care and much else of the economy.

If a political movement hopes to stand solely on the backs of rigid ideologues, it is doomed to failure.  And the Founders did not design a government in hopes of it being solely administered by perfectly virtuous men.  Instead, they created this government for real men.  It is not enough to denounce apostasy on Obamacare or any other issues.  Instead, conservatives can work to put forward policies that will make health care more affordable and expand the pool of those able to pay for their own health care. In doing so, they can lessen the need for a more expansive federal bureaucracy to administer health care while also offering politicians a market-oriented alternative that they can rally around in good faith.

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