Wall Street Journal: Kimberley Strassel: The Simplicity of a Health Deal

Posted on June 30, 2017

As Washington continues to boggle the nation with the complex minutiae of health-care reform, the contours of an actual deal aren’t nearly so mystifying. The success of the GOP effort comes down to one simple question: Will the most conservative members of Congress accept that the politics of health care have changed?

Or more simply yet: Will they acknowledge that any reform must include continued protections for pre-existing medical conditions?

It’s that easy. Yes, the media analysis is correct that there are two camps of defectors from the Senate’s reform bill. One consists of Republican moderates— Rob Portman, Dean Heller, Susan Collins, Lisa Murkowski —who claim the bill is too mean to poor and sick people. Cue mind-numbing media stories about Medicaid formulas and per capita spending caps and medical inflation, all of which make a compromise sound nigh impossible.

Hardly. Here’s a tip: When a politician claims a bill “cuts too much,” that’s an invitation to be bought off. There’s a reason several senators who had been largely mum on the GOP bill (Jerry Moran of Kansas, Shelley Moore Capito of West Virginia) came out against it only after Majority Leader Mitch McConnell delayed a vote. They saw the other holdouts were about to get payola, and they wanted theirs.

And there is cash to be had. With the stakes this high, the Senate leadership will gladly shuffle some money toward opioid treatment, rural health-care providers or Medicaid. So getting the “moderates” on board is simple and transactional. They name a price, they get pork, they vote yes.

The conservatives are the sticking point, precisely because they have principles. Sens. Ron Johnson, Mike Lee, Rand Paul and Ted Cruz have been clear from the start that any bill must lower premiums, which involves getting rid of costly ObamaCare mandates. And there is no question that among the most expensive mandates are those designed to protect individuals with pre-existing conditions—in particular “community rating,” which requires insurers to charge the same prices regardless of health status.

The House Freedom Caucus was so intent on getting rid of community rating that it nearly derailed the bill. Only after the conference added an amendment allowing states to apply for waivers from community rating did the most conservative members finally came on board.

Even so, it was always clear that provision was never going to fly in the Senate—and for a simple reason. Freedom Caucus members tend to hail from inordinately conservative (and safe) congressional districts, whereas senators represent entire statewide populations. And a sizable majority of the public strongly supports retaining protections for pre-existing conditions.

This is the true legacy of the Republican presidential loss in 2008, and the health-care law that resulted. Few Americans ever understood the stunningly complex means by which ObamaCare screwed up the individual insurance market, or the wider economy. To this day, most Americans haven’t intimately interacted with the law, as they receive their health care from an employer or Medicare.

But every American remembers two particular provisions of the law—pre-existing conditions and coverage for children up to 26. These policies are simple and sound good. And they have become over the years a new standard in most people’s minds. A February poll from YouGov showed 77% support for protections for consumers with pre-existing conditions.

Principles matter, but so does public will. Conservatives will argue their side just needs to do a better job explaining how these mandates drive up costs for everyone, or lower the quality of care. These are valid points, but they’ll count for little in the face of 2018 Democratic campaign ads that flash GOP names next to a graphic of a kid in a wheelchair with cancer who can’t get care. Republicans lost this argument nearly a decade ago, when Mr. Obama won. More than 90% of Senate Republicans understand this.

Which is another way of saying that protections for pre-existing conditions are here to stay, and conservatives face a choice. They can work with their colleagues to minimize the costs of the mandates (there are innovative ways to do this) and build in different free-market reforms to lower premiums. The Congressional Budget Office estimates that the current Senate bill will reduce premiums by about 30%, and the GOP can and should build on this.

Or they can kill the bill, and get no premium reductions at all, no deficit reduction, no Medicaid reform, no tax cuts, and no economic boost. Oh, and the protections for pre-existing conditions would remain. Plus, electoral disaster would loom.

It’s a binary choice, rooted in blunt political reality, which ought to make it an easy call. The question is whether conservatives will be savvy enough to forge a face-saving compromise and seek victories elsewhere in the bill. The health-care debate has changed over the past decade, and Republicans can’t reverse it on a dime. But they can pass a bill that starts the walk back to freer health-care markets.