By Rich Lowry
Friday, November 14, 2025
The debate over affordability is now truly and fully
joined.
After the off-year elections, Democrats are coalescing
around a cost-of-living message that makes more sense than their anti-Trump
obsessions (not that we aren’t going to hear a lot about those). For its part,
the White House has concluded that affordability is a vulnerability, and Trump
has thrown out a raft of proposals to address it, from $2,000 tariff rebates to
50-year mortgages.
Health care will be a major front in this fight, a
traditional Democratic policy strength that the party emphasized during the
just-concluded government shutdown.
In isolation, the Democratic demand to extend Obamacare
subsidies in perpetuity shouldn’t be sustainable. The party’s position is, in
effect, “We passed a sweeping health-care reform that we promised would lower
costs, and now that it’s done the opposite, it is incumbent on Republicans, in
the name of all that is right and good, to support additional subsidies for the
law.”
The GOP is so hopeless on health care that it will have
trouble countering this argument. Fifteen years after the passage of Obamacare
and after a major attempt to repeal it early in Trump’s first term, it still
lacks a concrete alternative of its own, even though the policy direction here
should be clear enough.
Obamacare imposed massive new regulations on the
individual insurance market in order to cover the sick and lower costs. The
fact is that there are better ways to achieve the former goal, and the latter
has been completely unrealized.
As Avik Roy of the Foundation for Research on Equal
Opportunity points out, Barack Obama ran for president promising that his
health care reform would reduce premiums by as much as $2,500 per family. That
was as misleading as his promise that “if you like your plan, you can keep your
plan.” Roy notes that premiums for the benchmark “silver” Obamacare plans — the
law created metallic tiers for various insurance plans — has nearly tripled
since 2013.
At the same time, deductibles for those same silver plans
have more than doubled, outpacing the rate of increase for employer-sponsored
plans.
Democrats no longer pretend that Obamacare is going to
reduce costs. Instead, they insist that without expanded credits first passed
under President Biden in 2021 and then 2022 — now set to expire — Americans
will experience a cost apocalypse. “Cancel the cuts. Lower the cost. Save
healthcare,” is how Hakeem Jeffries has put it.
The subsidies, though, only cushion consumers from the
worst of a poorly designed system. A basic problem of Obamacare is that it
charges young and healthy people higher premiums than they would pay otherwise
— making health insurance less attractive to them — to subsidize the premiums
of the old and sick.
As Roy observes, it’d make more sense to have so-called
reinsurance programs, either at the federal level or in the states, to pay the
cost of care for people with preexisting conditions. This alone should reduce
premiums for everyone else. The “age band” imposed by Obamacare — mandating
that young people can’t pay too much less than old people — should be loosened.
Obamacare taxes should be repealed; the law should allow for genuine,
bare-bones “catastrophic plans” for those who want one; and states should be
given as much leeway to innovate as possible.
Republicans would also be smart to build on a Trump
administration rule from the first term that allowed employers to fund accounts
— Health Reimbursement Accounts, or HRAs — for employees to buy their own
individual coverage.
None of these ideas will make the case for themselves,
though. Republicans have to introduce them to the public and explain them, even
if they’d prefer to be talking about something else. Failing to do so
represents a serious political risk — of either swallowing Obamacare subsidies
that they never supported before, or going to the voters next year
empty-handed. If they lose the midterms on the issue of affordability, they
can’t say that they weren’t warned.
No comments:
Post a Comment