After the Affordable Care Act

Today, the members of the Supreme Court will meet in private to begin deciding the fate of the Affordable Care Act, and the millions of Americans whose lives and futures stand to be made more secure because of the ACA. It's entirely possible that Anthony Kennedy will discover some place in his heart where integrity and a respect for the true role of the Court are supposed to be and the Act will be upheld, but at the moment you won't find too many people willing to bet on it.

So I'd like to spend a few moments working through what might happen if the Court takes the middle course, which could be the most likely—striking down the individual mandate, but leaving the rest of the law intact—both in the short and long term.

The immediate problem would be the fact that the individual mandate is what makes the law's most popular provision, the end of exclusions for pre-existing conditions, possible. Once nearly everyone is insured, the risk pool is expanded and insurance companies can function even if they're no longer allowed to turn anyone away. But if the bar on exclusions for pre-existing conditions is in place but the mandate disappears, no one would bother getting insurance until they showed up at the emergency room or got diagnosed with a serious illness. Insurance companies would eventually have only sick (and therefore expensive) people as customers, and premiums would skyrocket. It's a recipe for disaster.

Even those of us who don't feel too fondly about insurance companies understand this, and given the industry's substantial lobbying power, it's a fair bet that if only the mandate were eliminated, in short order Congress would pass a law eliminating the pre-existing condition ban, because the status quo is preferable to an absolute meltdown of the insurance industry. And presto: the best thing about the ACA—the fact that when fully implemented it gives every American the security to know they will always have coverage no matter what—is gone.

That suits Republicans just fine, of course. Better to take that security away from every American than to let Barack Obama have a policy victory. But I digress. Back to what happens next.

At that point, the core of the ACA may be gone, but there are still many important provisions remaining. Medicaid has been dramatically expanded, meaning millions of lower-income people can now get insurance. Millions of others can get subsidies to get insurance through the insurance exchanges, which would still be implemented. There are lots of things like incentives for hospitals to experiment with new ways of delivering care that will remain. All good.

But the essential nature of the system—as an employer-based system with poor and elderly people getting government coverage—remains. In the search for a silver lining, some liberals are hoping that the ACA being struck down could eventually lead to the kind of single-payer system liberals have wanted all along. Ezra Klein explains how that might happen:

With health-care reform either repealed or overturned, both Democrats and Republicans shy away from proposing any big changes to the health-care system for the next decade or so. But with continued increases in the cost of health insurance and a steady erosion in employer-based coverage, Democrats begin dipping their toes in the water with a strategy based around incremental expansions of Medicare, Medicaid, and the Children’s Health Insurance Program. They move these policies through budget reconciliation, where they can be passed with 51 votes in the Senate, and, over time, this leads to more and more Americans being covered through public insurance. Eventually, we end up with something close to a single-payer system, as a majority of Americans — and particularly a majority of Americans who have significant health risks — are covered by the government

This is a kind of pincer movement, as coverage is ratcheted up by income from Medicaid, and down by age from Medicare. Establish a Medicare buy-in for people over 55 (this was going to be part of the ACA, until Joe Lieberman realized it was something liberals liked, at which point he threatened to filibuster it). Do a similar buy-in for Medicaid for people at higher incomes. And so on.

This also means that the insurance industry would grow smaller and smaller over time as it had fewer and fewer customers. But let me offer a slightly different long-term goal, one that would mean insurers covering just as many people as they do now (and maybe more), but just changes what kind of coverage they provide. This scenario even offers a better system than we would have if the entire ACA were upheld.

We could move toward a system like they have in France, which the World Health Organization calls the world's best. That system has two parts. The first is a basic, government-funded insurance plan that covers everyone, meaning no one is uninsured, no one goes bankrupt because they get sick, and everyone has the security that comes with not worrying about your coverage. The second part of the system is a market in supplemental insurance, which pays for as many extra health perks as you might want, like a private room when you get hospitalized, or procedures not covered by the government plan. Most French people buy this supplemental insurance.

In theory anyway, such a system satisfies the desires of both liberals and conservatives. Liberals like the universal coverage and security that the basic system provides. And it would satisfy conservatives' most critical bottom line, and the reason they most fear systems like Canada's (a single-payer system without private plans): inequality. Conservatives are absolutely horrified by the idea that a rich person might not be able to buy better care than a poor person. But in a system like the French one, you can. You can get the most gold-plated supplemental plan you want. I'm sure that if we had it in America, someone would create a supplemental insurance plan just for hedge-fund managers, complete with weekly visits from a masseuse, rides to and from the doctor's office in a Bugatti, and hospital meals catered by Thomas Keller. And you know what? That'd be fine. Contrary to what conservatives believe about us liberals, I'm sure almost all of us would be perfectly happy to let the wealthy use their money to buy whatever crazy stuff they want, so long as the rest of us have a basic level of health security.

There's one problem, though: by now, no one can doubt that anything Democrats advocate on health care will be fought with every fiber of Republicans' being, up to and including the enlistment of their friendly justices on the Supreme Court, no matter what its content. And that's a problem that I have no idea how to solve, barring a couple of retirements on the Court.

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