Trump Never Meant to Repeal Obamacare

trump obama

By Eric Shierman

Donald Trump ran on Obama’s 2008 healthcare plan. What became the Affordable Care Act was actually Hillary Clinton’s 2008 plan. So both presidents have campaigned against this law, both presidents largely came to accept it, and both presidents’ approach to healthcare has been remarkably similar so far.

Like Obama, Trump has long supported a single payer system. He touted it in his 2000 book The America We Deserve. In the August 6, 2015 GOP debate in Cleveland, Trump explicitly defended a complete government takeover of the healthcare sector, saying to a Republican audience “it works in Canada. It works incredibly well in Scotland.” His opponents were quick to jump on that, especially Rand Paul.

Realizing that defending the British National Health Service might not be a winning position in a GOP primary, Trump did what Obama did when he instead pursued a heavily regulated private market that prevents health insurance companies from being insurance companies, a policy economists call community rating. In the wake of Clinton’s 1993 healthcare reform defeat, the last serious attempt at establishing a single payer structure, the Democrats seized upon this seemingly innocuous reform that would fundamentally change the health insurance market.

Trump did the same, but he also did so in the same irresponsible way that Obama’s 2008 campaign did, embracing this popular rule that forces insurance companies to pay for preexisting conditions while rejecting what all health economists warn must come with it: a coverage mandate. Like Obama, Trump’s response was to subsidize the market so much that people can afford the higher prices that inevitably come with this heavy handed regulation, telling 60 Minutes interviewer Scott Pelley in September 2015 “I am going to take care of everybody. I don’t care if it costs me votes or not. Everybody’s going to be taken care of much better than they’re taken care of now.” So Paley asked who’s going to pay for that. Trump said what any left-winger would say: “the government’s gonna pay for it.”

On March 2, 2016 the Trump campaign offered more details. His outline of a healthcare plan explicitly promised to keep the central regulation of Obama’s legacy. The rest of Trump’s plan involved repealing regulations that did not exist. There are no federal laws preventing states from allowing their residents to purchase plans from other states. Georgia allows its residents to buy plans from other states and has been experiencing the same skyrocketing premium increases every other state has, because Obamacare imposes community rating on all 50 states.

The core of Obamacare is not a lack of competition, and it’s certainly not the mandate of coverage. The core regulation of Obamacare that’s been driving up costs is mandating community rating. The coverage mandate is just the most efficient means of dealing with the spiraling costs that inherently come when you prevent insurance companies from engaging in basic underwriting.

Imagine what would happen to our auto insurance rates if the government mandated repairs for our cars’ preexisting conditions. Would the spiraling costs not be worse if the mandate to buy auto insurance were also removed? Would the promise to deal with these costs with government subsidies not be fiscally unsustainable?

Like the President, our own Greg Walden made a fiscally and politically dangerous promise at the annual Dorchester Conference last weekend when he said “If you’re on Medicaid today in Oregon you’ll be on Medicaid after we pass this bill.” That sounds a lot like an exaggerated promise the other side once made. I don’t blame Representative Walden for this. He’s always been a trooper for falling in line with what the GOP leadership has decided.

Repealing Obamacare could have been a simple thing, but the White House is leading Republicans in a treacherous direction. Once Trump decided to keep the core of Obamacare intact, the GOP then became doomed to repeal Obamacare only to replace it with Obama’s 2008 plan, something that would have to be far more expensive to work.

The House bill, however, is actually less expensive than what it’s trying to replace, but it won’t cover the same amount of people. This bill might pass the House, but when the CBO gives a credible, bipartisan estimate of the number of low income Americans who will go uninsured due to a loss of the ACA’s generous exchange subsidies and Medicaid expansion, at least three Republican senators will oppose it. When they do so, they might quote what Trump said in the February 2016 South Carolina debate:

There’s going to a group of people at the bottom — people that haven’t done well. People that don’t have any money that won’t be able to be care of.

We’re going to take care of them through maybe concepts of Medicare. We have hospitals that aren’t doing well, we have doctors that aren’t doing well. You cannot let people die on the street, OK?

Now, some people would say, “that’s not a very Republican thing to say.” Every time I say this at a rally, or even today, I said it — once, it got a standing ovation.

I said, you know, the problem is everybody thinks that you people, as Republicans, hate the concept of taking care of people that are really, really sick and are gonna die.

That’s not single payer, by the way. That’s called heart. We gotta take care of people that can’t take care of themselves. But the plans will be much less expensive than Obamacare, they’ll be far better than Obamacare, you’ll get your doctor, you’ll get everything that you want to get. It’ll be unbelievable.

There are only two votes to spare in the Senate. When it’s killed in the upper chamber by at least three of the seven Republican senators that have raised Medicaid funding objections so far, Bill Cassidy (R-LA), Shelley Capito (R-WV), Susan Collins (R-ME), Cory Gardner (R-OH), Dean Heller (R-NV), Rob Portman (R-OH), and Lisa Murkowski (R-AK), these moderates will simply say the bill does not live up to what the President has promised. If the bill gets amended to retain more of the Affordable Care Act’s new entitlement spending, then the President will lose the three votes of Rand Paul (R-KY), Mike Lee (R-UT), and Ted Cruz (R-TX). Even were Trump to pry off Cruz’s bandwagon vote, the increased spending will cause the CBO to score this bill with a negative fiscal impact, making it set to expire in 10 years.

Thanks to Republican primary voters, Obamacare is here to stay. If we had a President that could lead on this issue, there are free market reforms out there worth replacing Obamacare with. This first major piece of legislation appears to be going down in flames because Republicans nominated a guy that doesn’t know what he’s doing but has sure made a career of making promises that he can’t deliver.

Eric Shierman lives in Salem and is the author of A Brief History of Political Cultural Change.

  • Bob Clark

    Dear Eric: Mr. T was the only realistic alternative to beating Queen Hillary. Bush 3 wasn’t going to happen. Cruz didn’t have the blue collar Dems in the Midwest. The only chance, and it took a miracle even at this, was Mr. T. And the Ryan-Prez T bill gives the Health czar (what’s his name starts with p…maybe Price) a significant freedom to allow some freedom flowers to pop through the concrete.
    Realistically, as you well know, once you give out the candy (benefits as in ObamaCare and Medicaid), it’s very difficult to stop with the candy giving. So, the game plan becomes allowing loopholes for new medical service delivery and promoting those services so folks are enticed to remove themselves voluntarily from Medicaid and maybe even Medicare.
    The CBO will show a budget canyon from this new bill, but by the time the CBO gets to it; it’s either passed or defeated.
    We are in the time of animal spirits…Mr. T’s election is a miracle, and maybe, he pulls out more miracles from the conservative perspective.

  • Robert Collins

    You need to cut these postings down to around 600 words or less if you want to keep a reader for the whole thing.

  • redbean

    It’s been 50 years since Medicare-Medicaid gave us the HMO’s and insurance companies we deserve, leading to Obamacare. Fixing that isn’t going to happen in 90 days of a new administration, especially one beset by congressional enemies posing as friends. Long before Trump came on the scene, the GOP establishment joined the Democrats in scheming for their own version of complete government control of medicine, token CONstitutional CONservatives – hired to keep the tea partiers docile – not withstanding.

    O-care’s pushers are Big Labor and Big Business, whose salespeople masquerade as our representatives and senators in both parties. There are trillions of dollars at stake – they’re not going to give up without a fight. This is why the repeal process is proceeding as it is, not because Trump is secretly stumping for a single payer system or because of a lack of leadership on his part.

  • redbean

    Eric says, “Repealing O-care could have been a simple thing.” He then details the vote hurdle for the current effort, which shows it is not a simple thing at all. The problem is in the crooked process through which O-care was passed. A clean repeal bill requires 60 Senate votes, the reality being that a few Dems have to cross over. But Democrats are hoping for a scorched-earth repeal that leaves chaos in its wake – making their job in 2018 so much easier.

    That last Republican bill that Obama vetoed was not a repeal bill. It was a defunding bill, i.e. a reconciliation bill needing only 51 votes. To keep that 51-vote threshold requires that the new bill make no substantial changes to the original O-care bill; it can only change the financial framework, maintaining the same 10-year budget effect. Otherwise, the bill requires 60 votes. Dropping the filibuster rule might get it done but would be a pyrrhic victory.

  • redbean

    Eric, it’s not necessary to scrutinize Trump’s motives based on the thin gruel of his stump speeches, when his actions speak much louder. Successful executives build effective teams and given the nature of the Wall Street – K Street swamp, Trump is doing remarkably well at managing the gators. He appointed the knowledgeable, pro-market Tom Price to navigate the O-care repeal/replace. The choice of Seema Verma as head of Center for Medicare and Medicaid Services is also promising, but she was just confirmed on Monday, almost 2 months after the inauguration. (Thanks, GOP.) The appointments of OMB’s Mulvaney and Treasury’s Mnuchin point to some 3-dimensional chess-playing on Trump’s part. It’s a little early to throw in the towel.