Category: Impact

Democratic candidate Bernie Sanders recently released his health-care plan: a government-run single-payer system for the U.S., similar to what many European countries have. Criticism of the plan has so far focused on its lack of political feasibility, but there is an even more important reason to be wary: Accounting for costs and tax increases, it would reduce labor supply by 11.6 million. In a struggling economy, with tepid wage growth, hurting employment should be the last thing on any politician’s agenda.

The plan truly promises everything under the sun. Not only will everyone be able to get any medical treatment needed — with no cost at the point of service — but the plan won’t require a terribly high tax increase.

The growing number of ObamaCare failures creates an opportunity for conservatives to make a persuasive case for a replacement, experts said at a policy briefing held by the Conservative Reform Network and the Hoover Institution in Washington, D.C., on Wednesday.

“On healthcare, we too often hear that people on our side, that conservatives don’t have a plan,” said Grace-Marie Turner, president of the Galen Institute. “Conservatives overwhelmingly agree on principals and pillars for reform and for a replace[ment] plan.”

For all the damage that ObamaCare has done, it has also led to an awakening among Americans about the inadequacies and costs of a government-centered health care system. This awakening has created an enormous opportunity for conservatives. But making the most of that opportunity will require being clear about what is wrong with ObamaCare, why it needs to be replaced, and what a replacement must involve.

People are starting to get excited about another ObamaCare work-around: The section 1332 waiver. This refers to a section of ObamaCare that allows states great flexibility in how they deliver ObamaCare within their borders. The curious thing about section 1332 waivers is that they can only be issued as of January 1, 2017.

Why? Why not allow states to get section 1332 waivers as of October 2010, when ObamaCare’s first regulations took effect? Or January 2014, when the gushers of tax credits began to flow through the exchanges? Who knows? Maybe the administration just thought they needed a few years for the cement around ObamaCare to solidify.

Newt Gingrich and Tom Daschle have co-authored a report on how states can use section 1332 waivers to execute policy preferences either to the left or the right of ObamaCare. Anne Phelps of Deloitte & Touche LLP has also written a report describing the benefits of using a section 1332 waiver.

Unfortunately, while many 2016 presidential candidates have backed the “repeal” part of the “repeal and replace” equation, few have addressed how they would start over.

They would do well to follow the advice of The Heritage Foundation. The think tank’s soon-to-be-released policy handbook for candidates, Solutions 2016, lays out the “then what” reforms candidates should be talking about:

Last month, majorities in Congress voted to repeal the Affordable Care Act. Not surprisingly, President Obama vetoed the repeal bill, and the Republican Congress was unable to override the president’s veto.

As former leaders in Congress, we have a message for both sides in this debate: It’s time to give the states a chance.

This doesn’t mean that conservatives and Republicans have to give up the fight to reduce the regulations and taxes in the law. It also doesn’t mean that progressives and Democrats have to stop defending protections for the underinsured and uninsured.

Instead, it’s time to look to a provision of the Affordable Care Act — Section 1332 — that can achieve what both sides earnestly wish for: providing more Americans with access to more affordable, flexible, patient-centered health care.

As more requirements of the health care law take effect, income tax filing season becomes more complex for small businesses.

Companies required to offer health insurance have new forms to complete providing details of their coverage. Owners whose payrolls have hovered around the threshold where insurance is mandatory need to be sure their coverage — if they offered it last year — was sufficient to avoid penalties.

Even the most tax-savvy owners may find that do-it-yourself doesn’t work when it comes to fulfilling the law’s requirements. Many don’t know about the intricacies of the new health care regulations associated with the law that affect employers, says Lydia Glatz, an accountant with the firm MBAF in Fort Lauderdale, Florida.

“Most small businesses and mom-and-pop operations,” Glatz says. “They’re more involved in running their day-to-day business.”

N.C. Insurance Commissioner Wayne Goodwin this week became the latest public official to warn of the harms wreaked by the Affordable Care Act, saying the federal insurance law has destabilized the state’s insurance market and now threatens to leave some residents without options for health insurance.

Goodwin expressed his concerns in a letter sent Tuesday to Sylvia Burwell, secretary of the U.S. Department of Health and Human Services, as a follow-up to a personal conversation he had with the Obama administration official in November. Goodwin, a Democrat up for re-election this year, warned that the ACA is driving up insurance costs, reducing consumer options and generating unsustainable financial losses for the insurers, with the potential risk that insurers will withdraw from the state altogether.

Two studies published in the most recent Health Affairs journal raise questions about the contention that the Affordable Care Act will reduce employment, wages, and hours worked by employees.

The study by Gooptu and colleagues examined the effects of the law’s Medicaid expansion on employment and found no statistically significant effect through March 2015. A related study by Moriya and colleagues examined the subsidy structure provided to households getting health insurance through the ACA’s exchanges and similarly found no discernible effect on levels of part-time employment for employees eligible for these subsidies.

These studies provide useful new information, but they do not mean, as some reporting on them seems to suggest, that there is nothing to worry about with respect to the ACA’s effects on labor markets. Given the structure of the ACA, it would be hard to conclude the law would not eventually reduce hours worked or total compensation, although the magnitude of the resulting changes may be hard to detect in the U.S.’s large and complex labor markets.

Most standard questions aimed at presidential candidates in recent years have sought affirmation or denial of standard propositions. For example: Do you favor repealing or extending ObamaCare? Would you ensure near-universal insurance coverage? Do we need more federal regulation or greater state-level discretion?

That or they try to generate advance signals about near-term tactics. For example: Should we increase or trim taxpayer subsidies? How much should price variation be limited or curtailed? Are coverage and care goals better achieved through regulatory mandates or market-like incentives?

However, this is getting well-worn and generic, if not a little hackneyed, for these questions tend to obscure more basic dividing lines between candidates, and how candidates are likely to think about health policy and frame any plans for future changes. Of course, our vast accumulation of laws, regulations, institutions, entrenched interests, vulnerabilities, and evidence-free assumptions constrain any sort of “blank sheet of paper” rethinking in this sphere of politics. But we might better predict how candidates will proceed if we ask them the following five questions…