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Blackman, Barnett, and Scalia misrepresent the facts of insurance
on October 31, 2014
A little history:
The book provides a detailed history of ACA (Obamacare). The key Court arguments are found in Part VI. (Blackman labels the story a drama and calls his chapters parts.)
Randy Barnett is one of the conservative lawyers who led the attack on ACA. He was given the Foreword of the book to promote his philosophy.
In the Foreword and Epilogue, Blackman and Barnett endorse the conservative opposition to ACA. On page ix we see, "to save our country from Obamacare" which claims power that is "unlimited, unnecessary, and dangerous." The main opposition to ACA is about the mandate.
Originally, many conservatives supported the mandate for market-based insurance. ACA is similar to the 2006 Republican plan in MA. Earlier, the mandate was proposed by some Republicans in 1989, and again in 1993 as a simpler alternative to the Clinton plan. Reagan's 1986 mandate (EMTALA requires ERs to treat the uninsured) is still in effect.
ACA has much precedent; the title of the book is a misnomer. The origin of ACA was bipartisan. What is unprecedented now is the scope of the Republican campaign to defeat something people need, a good market-based opportunity to get health care insurance.
The book is also wrong to state (p. 4) that the mandate to carry insurance is redistribution. Carrying insurance and redistribution are different things. The book erroneously minimizes the history of the mandate on page 1, stating that it "was first advanced by conservatives as an alternative to `Hillarycare' in the 1990s." Elsewhere the book reports that it played a larger role and was part of a market-based plan for health insurance proposed by some conservatives in 1989, "the conservative origins of the individual mandate championed for over two decades by leading Republicans." Most conservatives continued to support the mandate. A few libertarians opposed it.
In 2008-9 our nation suffered a perfect storm in our economy, an all-hands-on-deck emergency (large banks going bankrupt, millions losing their jobs and homes). Instead of helping, Republicans in many forums pledged to do what they could to gridlock the new president before he even got going. That was unprecedented. An example is their attack on ACA. The main controversy is the mandate. Most Republicans supported it until Obama adopted it thinking it was bipartisan.
Jonathan Gruber is the MIT economist who was the chief consultant for Romneycare, which worked well in MA, and one of the advisors who developed ACA. The conservative view of ACA differs radically from his. Gruber's assessment of ACA is more accurate. His introductory book is "Health Care Reform."
When conservatives pivoted away from their support for the mandate, they made two errors:
(1) the claim that health care is like broccoli and (2) the claim that the purchase of health care insurance is the initiation of a commercial transaction, and therefore cannot be required.
The book supports the view that ACA is unconstitutional because it forces you to initiate and engage in commerce. ACA does not. ACA is no different from laws that say you can't walk out of a store with something and not pay for it.
A court has two main jobs: to determine issues of law and of fact. There are several issues which the 5 conservatives on the Court got wrong about ACA.
It's a simple story:
Human beings need health care. There is no livable, imaginable, civilized society without health care. The story Republicans are selling is a mathematical abstraction, a legal fiction that does not exist.
The need for health care is unpredictable. We know there will be instances over which we have no control (a serious condition arises; an injury). It can be expensive. Medical bills are the number one cause of personal bankruptcies in the U.S.
A fact of health care is that only a few can afford to self-insure. For all practical purposes, the only feasible way that most of us can pay for many instances of care is with insurance.
Virtually no one goes through life without an occasional need for health care. To have health care accessible, insurance needs to be already in place. A young person who has not purchased insurance knows that if he breaks a leg, he will go to the ER for treatment. To pretend that his plan to get care is a separate transaction from the need to purchase insurance to pay for that care is a simple falsehood. The transactions are not separate. They are two sides of the same coin.
A mandate to carry insurance is not the initiation of a new commercial transaction. The only reason people purchase health insurance is to pay for their care.
The mandate to carry insurance and pay a regular premium is no more than the simple requirement to pay for a service you are already committed to using - in the only way that you can pay for it!
To allow 50 million people to not pay for insurance, and dump their costs on others, disrupts the national economy. The Commerce Clause gives our government the power to prevent that imposition. No stable nation would allow its economy to be disrupted. The mandate to carry insurance is no more than the mandate to pay for a service you are committed to using. It is clearly warranted by the Commerce Clause.
Inactivity: To fail to pay for something you use is not "inactivity." It's a kind of fraud. It should not be a permissible "inactivity" to fail to pay for a service you are committed to using in the only way you could, in many instances, feasibly pay for it.
If conservatives believe that being asked to pay for something you use is a new transaction separate from its use, why don't they demonstrate that belief by walking out of a store with something and claiming they can't be asked to pay for it?
Republicans created a false story when they compared health care to broccoli. Health care is not a voluntary activity like eating broccoli. They are different kinds of voluntary activity. Breathing is voluntary. But virtually no one chooses to stop.
Similarly, virtually everyone treats some instances of health care as necessities. If they do not have insurance, they go to an emergency room. It is disingenuous to ignore the duress in choosing health care, compared to more free choices. Health care is not like anything else.
People make ongoing use of care and plan to continue using it. It's a standing plan. To label it a one time decision to get care is to ignore the nature of health care.
It is wrong to equate health care insurance with broccoli. Many people lead fine lives without owning a car or eating broccoli. But life can be brutal without health insurance.
When comparing health care to more free choices, the difference in degree is so great it becomes a difference in kind. People are committed to survival and to getting health care if the need is sufficient. The only issue is whether they will pay for it.
Eating is a necessity. We don't need a law telling people to eat or what to eat. But the law does say that you can't take things to eat without paying for them. (a reply to the arguments in Part III)
Virtually everyone treats at least some instances of health care as necessities. We don't need a law telling people to get health care. But the law should say that you cannot use the service without paying for it.
Not eating broccoli does not impose an unfair cost on anyone. Not carrying health insurance, like not insuring a car you drive, does impose unfair risks and costs on others (e.g., the cost of uninsured motorist coverage).
Health care is a practical necessity. It is not as voluntary as buying a car. Comparing it to broccoli is a story that doesn't correspond to reality. We have years of experience showing that people use care and impose their costs on others. Those are the facts that the Court is obliged to address, rather than a story that doesn't exist.
It is disingenuous to ignore the nature of health care risk by pretending those events are freely chosen, and do not require us to have insurance already in place. To buy health insurance at the time you need care would violate the nature of insurance.
Risk is a fact of life. In many areas of life, insurance is a necessity. Insurance pays for some things that we use sporadically. But the risk is a constant. The need for insurance, your peace of mind, and the peace of your family are all constants. These constants are covered and purchased all the time, continuously, by insurance.
It misrepresents the nature of insurance to equate it to a one time use of something. You suffer risk at all times. The need for insurance is continuous. Not paying to cover your own risk is fraud; it dumps the cost on others.
The conservative Justices asked the philosophical question about breaking new ground in the power of government. ACA does not. There are many areas of law that prevent you from imposing costs on others. If you risk imposing a cost on others, the law requires you to do things.
Imposing costs or risks: You are not required to buy car insurance if you own a car. But you are required to carry insurance, and have the car inspected, when you drive it. (You also pay for insurance in the ticket price for public transport.) Building owners are required to meet codes, shovel their walks, and carry insurance. Of course, the facts of health care are different from owning a car or building, but this principle is the same: When you impose a cost or risk on others, the law can require you to pay. It's nothing new.
This, and the other areas summarized here, show that ACA is not "a unique claim of congressional power." (p. ix) Since government (the sovereign power of the citizens) has the right to regulate commerce, it has the right to not allow the unfair imposition of costs on others, especially by 50 million.
Many false claims:
It is also false to label ACA socialized medicine. It's only a plan for insurance. The service delivery takes place in a free market. Like most insurance policies, it allows you to choose your provider.
Republicans made false accusations about death panels that did not exist. But estimates do show there are 7 - 17,000 deaths per year in all GOP states due to their blocking of both the exchanges and Medicaid expansion.
Citizens in the other developed nations are on average healthier and live longer that we do. The culprit is the way our private insurance corporations choose to work.
It is not true when Republicans claim that ACA disrupts a good system. Blackman could have included a chapter to address criticisms of the insurers by Gruber, Uwe Reinhardt and Wendell Potter, and in Paul Krugman's old Times columns. But he doesn't mention them: In the US we have the most expensive and wasteful system of health insurance on the planet. We pay double what other developed nations pay, but our results rank way down on the list. Our private insurers engage in deception and cause the most abuse: interfering between doctor and patient, denying and dropping coverage, and leaving the largest number of uninsured among the developed nations. They have given us a rapid rate of increase in premiums. ACA will reduce, not increase, that rate. Citizens and visitors in other nations have described the advantages in their access to care, but our conservative media refuse to report on that.
Given their status and the scope of their contributions, to leave out Gruber, Reinhardt (brief mention), Potter, and Krugman, while repeatedly presenting the opposing claim that ACA is unprecedented, was an egregious omission.
The private insurers behave so badly because health care insurance cannot work as insurance. We label it insurance but it's not pure insurance. It's also a buying club. Some consumers have grocery buying clubs. They don't have grocery insurance.
Insurance is when many pay for coverage, but only a few collect. Car and home insurance are regulated and work well. They work because only a few homes burn down and only a few cars are totaled (while insured) or cause serious injury. Most customers pay in premiums much more than they collect.
But with health care, most of us have large bills, and we're all totaled at the end. The actuaries can't make money for the health insurers, so the companies compete by finding ways to gouge, deny coverage, drive up premiums, and leave 50 million uninsured. To counter the abuse, we need the kind of regulations supplied by ACA.
Human beings are not commodities. Health care is a unique need and is not like anything else. A law requiring you to pay for it by carrying insurance is not the same as requiring you to do anything else or pay for anything else. We will not have laws requiring everyone to purchase a car, purchase car insurance, or eat certain foods. A court decision should state that limit, while recognizing that the mandate is constitutional. Regarding that limit, conservatives saw no difficulty in deciding Bush v. Gore, while limiting the scope of that decision.
Republicans organized a campaign of fear. The story they told was that if government could require you to carry health care insurance, then it could require you to do anything. It was a false comparison. But that comparison convinced the swing vote on the Court, Anthony Kennedy.
Stable societies have always had rules. We occasionally make constructive changes in the rules. Opponents of change sometimes try to argue that if you allow a change, then there would be no rules. Opponents of gay marriage argued that if we allowed it, then we would allow any kind of activity, and social order would be gone. Not true.
Similarly, opponents of requiring health care insurance argue that if we can do that, then all limits are gone and government could require anything. Not true. As described here, the limiting principle is that the mandate is not a separate transaction. It's about paying, in the only feasible way most of us can, for a service you already use and a risk and a cost you already impose. It is regulation of an ongoing use and risk.
A little history:
The health insurance mandate was originated and long promoted by many conservatives who did not (as Blackman documents) question its constitutionality. Now conservatives nitpick to claim that they didn't really mean it. Like John Kerry, they were for it before they were against it.
Conservatives say there are differences between ACA and what they proposed. Of course there are, but that's not the issue. It's their claim, now, that the mandate is unconstitutional.
Blackman describes meetings in which conservatives sought ways to defeat Obama's legislation. Opposition to the mandate gradually gained popularity as a way to defeat ACA. Originally, the argument that the mandate is unconstitutional was not widely supported on its merits. It was a device for opposing ACA, even though ACA was based on GOP ideas.
For years, the claim that the mandate is unconstitutional was described by legal scholars and by conservatives in words reported by Blackman: very pessimistic (about the claim), highly skeptical, not...raised at all, frivolous, (not) the slightest merit, not even a close question, futile, a stretch, scoffed at, ridiculed, laughed at, and similar words. Its constitutionality was labeled unquestioned
Some conservatives continued to support the mandate until the court challenge was well along. Newt Gingrich did not announce his opposition to the mandate until 9 months after the bill was signed (p. 11, 79).
In summary, it is not accurate to label ACA as unprecedented. To find a moderate, bipartisan way to pay for health care, Obama borrowed the market-based plan previously supported by Republicans. In 1993 many Republicans said the Clinton reform wouldn't work. In fact, the private communications of some showed that they blocked it because they were afraid it would work. They were serving the insurance industry that wanted to keep the advantages it had.
The lack of any reform at that time left the industry unchanged. The painful consequences for us have been spiraling, out of control costs; interference in and denial of care; and vast numbers suffering the brutality of life without health insurance.
While advocating choice, Obama compromised by eliminating the public option supported by his base. ACA is market-based: the mandate, exchanges, private insurers, and choice of providers. When Republicans promise to "repeal and replace" because they have a more workable market plan, they're promising something that does not exist.
ACA or Romneycare is the market-based way to make insurance accessible. ACA is a compromise. The only simpler, more efficient, less expensive, and more popular option would be Medicare for all. Either way, it is inhumane to leave tens of millions unable to pay for health care.
For decades there has been no serious market-based proposal for health insurance that did not include a mandate, except by libertarians who were willing to accept a status quo where millions are unable to find decent coverage that is affordable.
Opposition to change:
As mentioned, the home and car insurance markets work well. By itself, the health care insurance market will never work. By themselves, the insurers will never stop abusing, dropping coverage, and leaving millions uninsured. Republicans who want to give them yet another chance are on their payroll. Those politicians do not represent us. They're the same politicians who blocked cost controls such as allowing Medicare to negotiate for drug prices.
Only a well-regulated market works for health care. The other developed nations are doing better than we are, at half the cost per person. Romneycare and ACA are examples of a system that can work.
In the past hundred years, no developed nation has found that an unregulated market for health care insurance works. That is significant evidence that warrants a policy response. That evidence should not be ignored.
Our current system has failed. The lack of adequate regulation has allowed the abusive practices by the insurers and left millions uninsured. Those are not conditions we are obliged to accept in a civilized nation.
ACA is now working well in those states where it is not being blocked. Many got insurance at reasonable or even low rates. But healthy people do need to pay in. It's the only way insurance works. If you object to the cost of insurance, remember, medical bills are the number one cause of personal bankruptcies in the U.S.
Of those who are, unfortunately, paying more, many previously had inadequate coverage. In fact, most of the scare stories about this portrayed in GOP ads were shown to be false.
Many people have kept their previous coverage. Obama was wrong to say that everyone could. He admitted he was wrong to say that. Republicans have said many wrong things but have not admitted that. Obama and his wife always had good incomes and good health insurance. When he said you could keep the coverage you had, he may have been thinking of people who had coverage, good coverage that, if you had a real choice, you would want to keep.