Thoughts on the CBO Scoring

I haven’t written much about the Republican healthcare plan because it’s fairly obvious that it’s never going to happen. Another nail was put in the coffin yesterday when the CBO released their analysis of the Republican healthcare plan. The bottom line is that it would cut spending by $800 billion over ten years, cut taxes by $500 billion over ten years but increase the number of uninsured by about 24 million through both cuts to Medicaid and the elimination of the insurance mandate. The reaction has been about what you’d expect: conservative touting the deficit reduction and downplaying the uninsured numbers; liberals doing the opposite and accusing Republicans of literally murdering people to get “tax cuts for the rich”.

A few thoughts on this:

First of all, I would take any projections about the number of insured with several large helpings of salt. This number is infamously difficult to project. The CBO previously overestimated how many people were going to enroll in the Obamacare exchanges to the tune of 8-10 million. A lot will depend on what’s happening with the economy, what the states do, etc.

In many ways, the GOP is being more honest here with their CBO analysis. As McArdle reminds us, the Democrats heavily gamed the CBO projections of Obamacare:

During the process of passing the Patient Protection and Affordable Care Act, or PPACA, many of us complained that Democrats were gaming the CBO process, tossing out desperate cuts and pay-fors over and over until they got the score they wanted, in much the way video-gamers try to kill a hard boss. They ended up jamming in a bunch of provisions that made Obamacare’s finances look sturdier than they were, but realistically, had no hope of ever taking effect (among my favorites: a never-never long-term care program, and a requirement that everyone in the country had to issue 1099s to anyone who sold them more than a few hundred dollars worth of stuff). We certainly can’t accuse Republicans of that!

They also phased in the tax hikes years ahead of the spending hikes so that it appeared to balance over ten years even though it was running a deficit by the end of the window.

Second, if you want to know why so many people despise the Left, check out the verbiage being used to describe this. The Republicans are “taking away” people’s health insurance and “giving” money to the rich. They are “stealing from the poor and giving to the rich”. This is “class warfare” of the rich against the poor. This is high-grade horse manure but unfortunately what passes for thought in Left Wing circles. You can’t “take away” something that you’re giving to people free of charge. And you can’t “give” money to people that is already theirs. A more accurate description is that the Republicans are taking less from the rich to give to the poor. That’s fair enough and if you think that it is the government’s job, fine. But please stop with this “taking from the poor and giving to the rich” line. It’s nonsense and a mangling of the English language.

Third, ignore any claims that the Republicans are literally killing people here. We were told, when Obamacare passed, that lack of health insurance killed 100,000 Americans every year. If that had been the case, we should have seen a big drop in mortality since the bill was passed. We haven’t (in fact, mortality has ticked up a bit). The benefits of Medicaid, in particular, are highly disputed.

Fourth, I have no idea, given the inevitable lashing the GOP will endure, why they’ve written the bill this way. Since they’re going to be accused of murdering people anyway, why go with Obamacare Light?

Finally, let’s not forget something important. It’s not like the Republicans are fixing a problem that doesn’t exist. The ACA is teetering, with insurance rates skyrocketing, insurers pulling out of the exchanges and the beginnings of a death spiral in the individual insurance market. The problem with the ACA is that it did nothing whatsoever to make insurance “affordable”. All it did was shift the burden around, taking money from one group of people to make insurance “affordable” for another. But the price of health insurance remained what the price of health insurance is. And since numerous people are deciding they would rather pay the fine than astronomical insurance rates, the system is on the brink of collapse.

The Republican plan, however, does not address this problem at all. If anything, it makes it worse, replacing the Obamacare tax with higher insurance premiums for those currently uninsured, thus making the death spiral even steeper. It’s simply a terrible idea, both financially and politically. Because if the Republicans pass this law and the Obamacare markets collapse, they will take the blame for it.

Many are suggesting that the Republicans should just let Obamacare collapse so that the Democrats take the blame. I’m dubious about this. First of all, I don’t like using millions of people’s healthcare coverage as some kind of political tool. Second, the Republicans will almost certainly be blamed anyway. In fact, many liberals are blaming Republicans right now for eliminating the risk corridors — the subsidies paid out to insurance companies to keep the exchanges afloat. That’s how bizarre politics has gotten — Democrats accusing Republicans of killing poor people by their refusal to subsidize some of the largest businesses in America. Either way, Republicans are going to be blamed for the mess that Obama has created. I don’t see that there’s a good option here. But passing the AHCA is certainly a worse option than doing nothing.

Ultimately, our efforts at healthcare reform continue to founder on the same rocks: Americans can’t make up their minds what they want. Every healthcare system in the world balances tradeoffs. Ours gives up universal coverage and affordability for quick response and rapid technological innovation. Socialized systems are universal and “free” but sacrifice availability and demand heavy taxation. What the voters seem to want is insurance where they can get all the care they want, see any doctor they want but not have to pay any money for it. That’s simply not going to happen. And until someone — Republican or Democrat — acknowledges that, we will continue to stumble from bad plan to bad plan.

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  1. West Virginia Rebel

    One of the good things about American insurance has been the availability of choice, expensive though it might be. Now Democrats want the insurance companies to essentially get a bailout-or force everyone onto single payer. Talk about something that would kill the poor.

    Of course Ryan isn’t helping himself by talking up the Republican sh*t sandwich they call a replacement. It was cobbled together with an end-run around normal procedure, designed to reassure people who liked Obamacare that their favorite parts wouldn’t be taken away. It should die a quick death.

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  2. AlexInCT

    One of the good things about American insurance has been the availability of choice, expensive though it might be. Now Democrats want the insurance companies to essentially get a bailout-or force everyone onto single payer. 

    As Bernie so eloquently pointed out when he uttered the question “Why do you need 23 brands of deodorant?”: collectivists will limit your choices to what they like, and you better not complain.

    Of course Ryan isn’t helping himself by talking up the Republican sh*t sandwich they call a replacement.

    I have a sneaking suspicion that this was the intent from the start. The republican establishment doesn’t like the idea of government power shrinking now that they are in charge, and this whole kerfuffle with the CBO was orchestrated on purpose to delay the repeal of Obamacare.

    It was cobbled together with an end-run around normal procedure, designed to reassure people who liked Obamacare that their favorite parts wouldn’t be taken away. It should die a quick death.

    Yeah, it was almost like they designed it to fail from the start. I ask again, what would be wrong with just repealing Obamacare and going back to what existed before, and then coming up with a system that splits catastrophic healthcare from regular health maintenance, and move on from there. And no, the argument that some people will lose their insurance or will not get insurance, doesn’t fly with me. No plan can prevent that from happening as Obamacare clearly proved. Some people simply will choose not to get this, and that is their right.

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  3. Aussiesmurf

    Alex, only certain parts of the Affordable Care Act can be repealed using the mechanism of reconciliation (50 votes).  Many portions, such as the pre-existing condition provisions, will require 60 votes, presuming there is a filibuster (and I think that’s a pretty fair presumption).  Therefore, the bill has to either (1) ONLY deal with the portions which require 50 votes (2) Have parts which will get 8+ Democratic senators to vote for it or (3) Have the 52 Repubs vote to abolish the filibuster entirety.

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  4. AlexInCT

    That’s all excuses to me Smurf. Bring up the vote, get the democrats to oppose it, accuse them of not allowing you to get rid of the whole horrible thing (and that is an understatement of how bad this thing is) so you can fix what they broke, and let that ride. And I think Harry Reid already did away with the filibuster mechanism when he held the top dog job so the democrats could do whatever they wanted.

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  5. Aussiesmurf

    The filibuster was abolished for government appointments (Save for the Supreme Court) not for legislation.

    And the Democrats are quite content, to all appearances,  at being described as being in favour of the Affordable Care Act.

    Your basic problem is that the GOP House wants a bill further to the right, and the GOP Senate wants a bill more to the left, so squaring the circle is going to be difficult for the majority party.

     

    Governing is actually not that simple, as many of the far-right newer representatives are now finding out (and I include Trump in that comment).

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