Nearly seven years ago, moments before President Obama signed the national healthcare legislation into law, he declared, “When I sign this bill, all of the overheated rhetoric over reform will finally confront the reality of reform.”
Obama was right about rhetoric and reality meeting, but when they converged, the outcome was a lot different than he had hoped. Instead of vindicating him and boosting Democrats, the reality of Obamacare savaged his own political party in three different election years. It’s in large part thanks to Obamacare’s failures that Republicans now control the House, Senate and presidency, and are in a position to wipe out the president’s signature legislative accomplishment.
There is an important message in all of this for Republicans now contemplating how to unwind Obamacare and replace it with something else. The lesson isn’t merely that Obamacare failed politically because it was bad policy – after all, plenty of terrible federal policies thrive despite their failures. The lesson is that it failed politically because there was a large gap between what Obama promised when he was selling Obamacare and actual life under Obamacare.
When running for president in 2008, Obama predicted that under his plan, family premiums would be lowered by $2,500 per year. When he ran for re-election in 2012, he told Americans that once the law was fully implemented, “your premiums will go down.” More notoriously, Obama promised that under his program, everybody who liked their plans and their doctors would be able to keep them.
Obama made these sweeping claims knowing what the reality was: that premiums typically go up each year; that increasing regulations and forcing insurers to offer more comprehensive coverage puts further upward pressure on premiums; that younger people would no longer be able to purchase cheaper bare-bones plans; that millions of individuals purchasing insurance on the individual market wouldn’t be eligible for subsidies to offset premium hikes; and that the massive regulatory changes he was imposing on insurers would force them to make decisions that inevitably would disrupt the health coverage of millions of people.
Obama made these claims because he wanted to stave off Republican attacks that more government meant higher prices, and that overhauling the healthcare system meant messing with Americans’ existing coverage (which polls showed eight in 10 Americans were happy with). Though this served his short-term political purposes, it eventually came back to haunt him. When the premiums inevitably skyrocketed in a number of markets and people lost coverage and doctors that they liked, it fueled the Republican takeover of the Senate in 2014 and damaged Hillary Clinton in the weeks leading up to the 2016 presidential election.
Fresh off of their victory, Republicans are falling into the same trap that Obama did when pushing Obamacare by creating expectations that cannot possibly be met.
“We don’t want anyone who currently has insurance to not have insurance,” said senior Trump adviser Kellyanne Conway about those who are currently covered through Obamacare. There is simply no way that Republicans could repeal the taxes, regulations and spending in Obamacare and expect that it won’t cause any disruption to anybody.
Though it’s true that, in theory, Republicans could cover as many people as Obamacare for less money if they moved toward a system of catastrophic coverage (that is, toward plans aimed at protecting people against financial ruin in the case of a major illnesses or accidents), Trump’s own boasts make that more difficult.
Trump has attacked Obamacare for having high premiums while “deductibles are so high that it is practically useless.” This even though any plan to tackle premiums would hinge on reducing regulations so that individuals would have the option of purchasing cheaper plans that carry higher deductibles.
Republicans are in serious danger of repeating Obama’s mistake, because they are having a tough time stating a simple truth, which goes something like this: “We don’t believe that it is the job of the federal government to guarantee that everybody has health insurance.”
State this simple truth when asked about coverage levels, and there’s plenty of room to make the case for the benefits of replacing Obamacare with market-based solutions that bring down costs, offer more choices, and don’t force individuals to purchase government-designed health insurance policies.
Speaking honestly may open up Republicans to short-term political attacks, but it would also smooth the policy-writing process, limit embarrassing moments as Republicans struggle to explain their contradictions, and in the long run, avoid the pitfalls of setting up unrealistic expectations.
If, on the other hand, Republicans don’t have the courage to defend their opposition to government healthcare guarantees, they are doomed to fail. The process of replacing Obamacare will be crippled by the conflict between trying to meet some sort of vague coverage target and trying to limit levels of taxes and spending. Even if Republicans manage to pass some sort of plan to repeal and replace Obamacare within these constraints, they will suffer political consequences when the rhetoric they used to sell their plan meets reality.
