Lies may kill health reform before it gets started

IT’S SAID you can judge a man by the quality of his enemies

IT’S SAID you can judge a man by the quality of his enemies. If the same principle applies to legislation, the Affordable Care Act – which was signed into law two years ago in the US but for the most part has yet to take effect – sits in a place of high honour.

Now, the act – known to its foes as Obamacare and to the cognoscenti as ObamaRomneycare – isn’t easy to love since it’s very much a compromise, dictated by the perceived political need to change existing coverage and challenge entrenched interests as little as possible. But the perfect is the enemy of the good; for all its imperfections this reform would do an enormous amount of good. And one indicator of just how good it is comes from the apparent inability of its opponents to make an honest case against it.

To understand the lies you first have to understand the truth. How would ObamaRomneycare change US healthcare?

For most people the answer is not at all. In particular, those receiving good health benefits from employers would keep them. The act is aimed, instead, at Americans who fall through the cracks, either going without coverage or relying on the miserably malfunctioning individual, “nongroup” insurance market.

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Individual health insurance, as currently constituted, just doesn’t work. If insurers are left free to deny coverage at will – as they are in, say, California – they offer cheap policies to the young and healthy but refuse to cover anyone likely to need expensive care.

Yet simply requiring that insurers cover people with pre-existing conditions, as in New York, doesn’t work either: premiums are sky high because only the sick buy insurance.

The solution – originally proposed, believe it or not, by analysts at the ultra-right-wing Heritage Foundation – is a three-legged stool of regulation and subsidies. As in New York, insurers are required to cover everyone; in return everyone is required to buy insurance, so that healthy as well as sick people are in the risk pool. Finally, subsidies make those mandated insurance purchases affordable for lower-income families.

Can such a system work? It’s already working! Massachusetts enacted a similar reform six years ago – yes, while Mitt Romney was governor. Jonathan Gruber of the Massachusetts Institute of Technology, who played a key role in developing both the local and the national reforms has surveyed the results – and finds that Romneycare is working pretty much as advertised.

The number of people without insurance has dropped sharply, the quality of care hasn’t suffered, and the programme’s cost has been close to initial projections.

Oh, and the budgetary cost per newly insured resident of Massachusetts was actually lower than the projected cost per American insured by the Affordable Care Act.

Given this evidence, what’s a virulent opponent of reform to do? The answer is, make stuff up. We all know how the act’s proposal that Medicare evaluate medical procedures for effectiveness became, in the fevered imagination of the right, an evil plan to create death panels. And rest assured this lie will be back in force once the general election campaign is in full swing.

For now, however, most of the disinformation involves claims about costs.

Each new report from the Congressional Budget Office is touted as proof that the true cost of Obamacare is exploding, even when – as was the case with the latest report – the document says on its very first page that projected costs have actually fallen slightly.

Nor are we talking about random pundits making these false claims. We are, instead, talking about people like the chairman of the House Republican Policy Committee, who issued a completely fraudulent news release after the latest budget office report.

Because the truth does not, sad to say, always prevail, there is a real chance that these lies will succeed in killing health reform before it really gets started. And that would be an immense tragedy for America, because this health reform is coming just in time.

As I said, the reform is mainly aimed at Americans who fall through the cracks in the current system – an important goal in its own right. But what makes reform truly urgent is the fact the cracks are rapidly getting wider, because fewer and fewer jobs come with health benefits; employment-based coverage declined even during the “Bush boom” of 2003 to 2007, and has plunged since.

What this means is that the Affordable Care Act is the only thing protecting us from an imminent surge in the number of Americans who can’t afford essential care.

So this reform had better survive – because if it doesn’t, many Americans who need health care won’t.

Paul Krugman

Paul Krugman

Paul Krugman, a Nobel laureate, is professor of economics at City University of New York, professor emeritus of economics and international affairs at Princeton University, and a New York Times columnist