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Healthcare Reform: Wyden-Brown Bill is a Trojan Horse

A new "bipartisan" healthcare reform bill introduced by Sen. Ron Wyden (Ore.) and Sen. Scott Brown (R-Mass.) has received qualified praise from pundits on the left and the right. Unfortunately, it's a Trojan horse that would spell the end for any effort to reach near-universal coverage across the U.S. Wyden should know better, and so should Ezra Klein of the Washington Post, who suspended his critical judgment in evaluating the proposal.

The Wyden-Brown bill would give individual states the ability to decide how they want to proceed on reform by moving up the effective date of an obscure provision of the Affordable Care Act from 2017 to 2014. Klein explains the provision in these terms:

If a state can think of a plan that covers as many people [as the Affordable Care Act], with as comprehensive insurance, at as low a cost, without adding to the deficit, the state can get the money the federal government would've given it for health-care reform but be freed from the individual mandate, the exchanges, the insurance requirements, the subsidy scheme and pretty much everything else in the bill.

Klein likes this idea because he believes it would allow state governments of various political persuasions to try out different ideas to see what works best -- yet without upsetting the central goals of the reform law. For example, Vermont, whose new Democrat governor-elect, Peter Shumlin, favors a single-payer system, could try that out. A more conservative state like Tennessee could emphasize consumer-directed health plans to see how well those would work. And if one approach got better results than another, it would spread to other states.

This, of course, is not a new idea. A few years ago, economist Henry Aaron of the Brookings Institution and Stuart Butler of the Heritage Foundation suggested that, because liberals and conservatives could not agree on how to reduce the number of uninsured, the states should try a variety of approaches with federal funding and guidelines. But that was before there was national legislation in place that specified how to expand coverage to 32 million people.

Ross Douthat, the conservative commentator for the New York Times, likes the idea of state experimentation in principle. But he points out that it wouldn't work if states had to require coverage as comprehensive as that mandated by the Affordable Care Act. "This seems to stack the deck against precisely the sort of consumer-directed, market-friendly systems that more conservative states would try to build," he writes.

His objection explains why the Wyden-Brown bill has the potential to subvert healthcare reform. Under the guise of letting states determine how to dispense health care, the proposal could add enough Democratic votes to the Republican majority to pass the House and possibly the Senate (although maybe not to sneak past President Obama's veto pen). Then, with no compulsion to start a state insurance exchange or require individuals to buy insurance, states could establish substitute programs supposedly designed to produce the same results as the Affordable Care Act. A few years later, when these states' promises proved to be empty, it would be too late to institute the original reforms, and the uninsured and underinsured would be more numerous than ever.

How about the single payer possibility? Let's say that Vermont did adopt a state-run healthcare system and banned private insurance. Let's further assume that the system covered more people with better benefits at lower cost than any other approach. Think Texas would follow Vermont? Hell no. They'd just call it a communist plot. And actually, Vermont Sen. Bernie Sanders, who helped Wyden insert the original provision, is a socialist.

Which brings us back to Ron Wyden. Several years ago, the Oregon senator proposed a universal coverage plan that would combine an individual insurance mandate with a requirement for employers to increase wages by an amount equivalent to what they now pay for insurance. Employees would then be able to shop for coverage on an insurance exchange similar to what's in the new law.

Wyden got some bipartisan support for his idea, and he was undoubtedly disappointed when the Obama Administration ignored it in formulating its healthcare strategy. But that's still no reason to open a hole in the ACA large enough for the Republicans to drive a tank through.

Image supplied courtesy of Wikimedia Commons.