By Patrick Brennan
Monday, January 05, 2015
New York magazine’s Jonathan Chait says he’s confused by
conservative glee over the news that Harvard professors are complaining about
changes to their health plans due to Obamacare. The faculty is mad about an
increase in their out-of-pocket costs, such as higher annual deductibles.
Conservatives, Chait points out, would like consumers in
general to pay for a greater share of their health care out of pocket, rather
than consuming it through our byzantine tax-sheltered insurance system.
Adrianna McIntyre, a health-policy writer formerly of Vox, says she’s therefore
“baffled” that conservatives are taking the professors’ side in this debate.
McIntyre and Chait may not be Harvard faculty (yet) but
they’re smarter than this: Conservatives aren’t saying a $750 family deductible
is too high or some great abuse. They’re saying it’s funny that Harvard
professors think it’s too high, because said professors generally like
Obamacare, and (according to Harvard) Obamacare is the reason their employer is
raising it.
Liberal writers engaged in something similar about a year
ago, expressing shock that conservatives kept pointing out how the high deductibles
of Obamacare-exchange plans can be a burden for a lot of Americans. But
conservatives say they’re for high deductibles and having skin in the game,
liberals said, as if this was some kind of significant, esoteric insight.
Obamacare hiked the cost of health insurance (leaving
aside subsidies) by implementing higher taxes and huge new regulations. Those
meant higher deductibles and higher premiums.
Conservatives therefore criticized both developments,
even though sometimes they think other policies that produce higher deductibles
are a good thing. Liberals sometimes like to argue that people really only care
about ends and that all conservative process objections are disingenuous — I’m
tempted to see what Chait’s doing as a particularly insane extension of that
argument.
“Harvard’s reforms show that in some ways, Obamacare has
pushed the health-care system moderately in the direction conservatives favor,
by encouraging employers to shift more of the cost of care onto employees,”
Chait writes. But the development at Harvard is higher overall health-insurance
costs — no one favors that. Harvard chose to pass some of the higher cost on to
its employees through out-of-pocket increases, which has nothing to do with the
fundamental structure of Obamacare except inasmuch as it forces costs up almost
everywhere.
The deductible increase is so small that it’s hard to
imagine that’s where most of the cost increases are even ending up. One of
Obamacare’s financing mechanisms, the Cadillac tax, will force pricey plans
like Harvard’s to do more out-of-pocket financing some day, but other parts of
Obamacare are driving costs up right now — Harvard refers to the Cadillac tax
as a “potential” cost.
Chait is right the Harvard example shows us that
increases in out-of-pocket health spending can be really unpopular. This is a
political challenge for conservative health reforms — and for liberal reforms
to the extent that this is how they expand coverage. That’s why conservatives
pair that reform with liberalization of other elements of the market, so that
overall costs can be reduced by market forces.
Assailing higher deductibles certainly can be problematic
territory if one has the eventual goal of a consumer-driven health system. To
the extent that conservatives may have suggested deductibles in the thousands
of dollars on Obamacare plans are intolerable, that’s unwise, because high
deductibles aren’t a bad thing per se. But there are benefits to individual
control of health-care dollars for almost everyone.
Virgil scholar Richard Thomas offered colorful criticism
of the Harvard plan to the Times, but conservative reformers, confident in
market forces, can genuinely say of out-of-pocket increases they favor, forsan
et hikes olim meminisse iuvabit.
Higher deductibles are definitely a bad thing when
coupled with higher premiums and less choice brought on by a bad law, which is
why the Harvard episode is not evidence that, as Chait claims, “Obamacare is
implementing some versions of conservative ideas.” And yes, many conservatives
may still not comprehend the political challenge of higher deductibles — but I
don’t think that’s because, as Chait argues, we have “a conservative media
apparatus that relentlessly turns all news stories into either non-stories or
confirmation of their increasingly discredited hysteria.”
Any more, that is, than liberals have a media apparatus
that didn’t prepare their partisans or Americans in general for the unpopular
sides of Obamacare, and still can’t quite spin the situation to satisfaction.
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