This morning, the Congressional Budget Office released a new report estimating that three to five million fewer people would receive employer-based insurance coverage under President Obama’s national health care law in each year from 2019 to 2022 than would be the case without the law. Under one scenario, the CBO said as many as 20 million would lose their employer coverage. Conservatives should be careful about how they react to this news.
To be sure, there are several important points to make from this report. The fact that millions of Americans will be losing their employer-based coverage is more confirmation that despite what Obama claimed when he was selling his health care legislation, not everybody will in fact be able to keep their coverage if they like it. The CBO study reinforces the reality that Obamacare is to migrate more people to government-run health care programs, mostly Medicaid and the new subsidized insurance exchanges. It’s also important to recognize that if more employers than expected dump workers on the government exchanges, the cost of Obamacare could explode. Currently, the CBO expects Obamacare to cost $1.76 trillion over the next decade (2013 through 2022). But that estimate increases to $2.1 trillion under the scenario in which 20 million workers end up losing their employer coverage.
All of that said, conservatives should handle this issue delicately. The centerpiece of just about every market-based reform of health insurance involves tweaking the tax code that currently is biased in favor of employer-based insurance. While details vary from proposal to proposal, in an ideal world of conservative health care policy, money would flow through individuals, who would have more choice over what type of coverage to buy and be able to take their policies with them from job to job. Moving to a system in which consumers have more direct control over their health care dollars would also drive down costs. But at the same time, transitioning to such a system would mean that fewer people would have employer-based health insurance. So it’s one thing to make the type of arguments I suggested above with regard to Obamacare. But it’s important that conservatives don’t muddle the message by making statements that reinforce the third rail nature of the employer-health insurance link or say anything that can be used against them when some future market-based proposal gets scored by the CBO as eroding employer insurance.