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Karl Rove Is Half-Right About Republicans and Health Care

Karl Rove is feeling a little defensive today. President Obama recently suggested that Republicans have no serious ideas for health care reform. Writers like Ezra Klein and Paul Krugman (and, yes, me) have written similar things many times. Rove thinks that’s nonsense. “Republicans,” he writes today in the Wall Street Journal, “have plenty of sensible ideas to make health coverage more accessible and more affordable.”

Actually Rove is at least half-right. Republicans do have plenty of ideas. But they are not the kind of ideas that would come anywhere close to achieving universal coverage, at least in the way most people understand it. At best, Republican proposals would make insurance a bit cheaper, mostly for people who are healthy and need coverage the least. At worst, these ideas would make coverage less accessible for people with pre-existing conditions—and leave more of the insured exposed to crippling medical bills.

The reforms that Rove describes in his op-ed fall into two categories, more or less. One category consists of reforms that most experts would support and, in many cases, are already part of Obamacare. An example of this would be efforts to curb defensive medicine. Even most liberals would admit that the existing malpractice system encourages physicians to provide tests or procedures that might not be necessary—and that these extra services make health care more expensive at the margins. Obamacare attempts to address this problem, by funding pilot programs in alternative ways of settling malpractice claims. These ideas include creating no-fault systems that would compensate all victims of medical errors, creating special health courts to hear cases before they go to lay juries, as well as the “sorry works” scheme (in which providers admit mistakes upfront and negotiate settlements) that the University of Michigan Medical System developed.

Conservatives complain that these proposals don’t go far enough. They would also prefer a different, blunter approach to the problem: Setting strict limits on malpractice damage awards. But even if their approach were preferable—a point folks like me would dispute—it wouldn’t help that much: The Congressional Budget Office has estimated that such limits would reduce health spending by half a percent and save the federal government about $49 billion over ten years. That’s not nothing, but it’s also not a game-changer, particularly when reforms already underway thanks to Obamacare are likely to capture at least some (and maybe most) of those savings.

The other category of reforms that Republicans endorse either wouldn’t reduce the cost of health care—or would do so in ways that make it more difficult for people with medical problems to get the care they need. The most obvious example is the suggestion that, after repealing Obamacare, the federal government allow insurers to sell coverage across state lines. The Republican logic goes like this: Historically, some states have regulated insurance more strongly than others. And, all esle equal, stroner regulation tends to make insurance more expensive. That’s one reason somebody buying an indivdiual insurance policy in, say, California traditionally paid more than somebody in Idaho.

But those state regulations exist for a reason—to protect consumers. It turns out, for example, that California has traditionally required insurers to cover screening for cervical and colo-rectal cancer. Idaho hasn’t. Allowing insurers to sell across state lines (again, after repealing Obamacare, which requires all plans to cover these things) would cause the proverbial “race to the bottom.” Insurers would gravitate to the states with the fewest regulations—in effect, doing exactly what the credit card industry did. Most state regulations would become effectively irrelevant. 

Coverage undoubtedly become cheaper and some regulations that really do seem superfluous would disappear. But for people who need the essential services that many of those regulations guarantee, coverage would be impossible to find. I’ve written about this a bunch of times. And I’m hardly the only one. But the idea just won’t go away. It’s a classic “zombie idea,” as health care blogger Aaron Carroll calls it today.

Republicans would say their ideas have more upside, and less downside, that liberal critics allow. I obviously think they are wrong. But concede the point for a second. Would the reforms Republicans endorse actually make a big dent in the number of people insured—or the ability of people with serious health problems to pay their bills? There’s no reason to think so.

The CBO and other analysts have examined these proposals and found, time and again, they’d boost coverage only marginally or increase insurance only by whittling down the protection it provides. The one exception that comes to mind was an assessment of John McCain’s proposal during the 2008 campaign—a proposal that, to McCain's credit, had some real ambition behind it. Among other things, McCain proposed changing the existing tax break for employer health insurance with a substantial tax credit. But McCain’s plan still wouldn’t have provided insurance to as many people as Obamacare will. (Conservative policy thinkers like James Capretta have put forth more ambitious ideas, but Republicans haven’t actually embraced those—perhaps because they’d have trouble defending the details. But that’s a topic for another day.)

Since 2008, Republicans have wanted nothing to do with the old McCain plan—perhaps because, even with its more limited reach, it would have cost quite a lot of money. Here we get to the real reason Republicans aren’t proposing more serious efforts to reduce the number of uninsured or establish decent standards of coverage for those who have it. Accomplishing those goals requires some combination of regulation, government spending, and redistribution—both from both rich to poor and healthy to sick. Republicans have made clear they oppose these things. Fair enough. But then they really can’t complain when people look at their health care agenda and see very little there.

Jonathan Cohn is a senior editor at the New Republic. Follow him on twitter @CitizenCohn

Note: This item has been updated.