Redistribution of wealth — one of the most radioactive subjects in American politics — has moved from being a subtext in the national debate over health care to being the core of it.
Politicians prefer to talk about health reform in terms of benefits — extending medical coverage to those who lack it, curbing increases in costs and improving quality.
They offer gauzy, have-it-all promises to make the system better, more efficient and more generous, as though it can all be done without anyone having to sacrifice anything.
House Republicans, led by Speaker Paul D. Ryan (R-Wis.), say that the measures they introduced Monday will increase competition and give consumers more choices.
What makes the latest health-care battle different from past ones is that it is not about building a new government program. This time, the question is whether to abolish one — and replace it with something else.
That means it is harder to gloss over a bedrock philosophical and ideological question that has always been in the background of any argument about the government’s role in health care: What is the minimum that society should provide for its poorest, most vulnerable citizens, and how much should be taken from the rich and powerful to do it?
“Even though it is a technical discussion, it’s a really big value discussion,” said Robert Blendon, a professor of health policy and political analysis at Harvard University.
Democrats, who had passed the seven-year-old system known as Obamacare without a single Republican vote, say that the GOP proposal to repeal more than 20 taxes enacted under the law amounts to a windfall for the rich and for corporate interests.
The Republican plan also probably would make Medicaid, the program that provides coverage to the poor, less generous.
Overall, it would be “a big transfer. This is a massive tax cut for unpopular industries and wealthy individuals,” said Andy Slavitt, who was acting administrator of the Centers for Medicare and Medicaid Services during the final years of the Obama administration. “It is about cutting care for lower-income people, seniors, people with disabilities and kids to pay for the tax cut.”
Meanwhile, conservative critics argue that the blueprint goes too far the other way. In their view, for instance, the individual tax credits included in the Ryan-backed plan to offset the cost of insurance are actually a new entitlement, not all that different from the subsidies provided under the Affordable Care Act.
“The House Republican proposal released last night not only accepts the flawed progressive premises of Obamacare but expands upon them,” said Michael Needham, the chief executive of Heritage Action for America.
However, economic historian Bruce Bartlett, who served in the administrations of Ronald Reagan and George H.W. Bush, said that argument ignores that health insurance itself is a means of spreading the cost of health-care around.
“Republicans argue that redistribution is inherently immoral without acknowledging that the very nature of insurance is per se redistributive,” Bartlett said. “You’re taking money from people whose houses don’t burn down to give it to the people whose houses do burn down.”
There were many ways that Obamacare also redistributed the burden of medical costs — from the sick to the healthy, with provisions such as the one denying insurers the ability to refuse coverage to people with preexisting conditions; from the old to the young, with a mandate that everyone have coverage or pay a penalty; from the rich to the poor, with an array of new taxes.
By contrast, “the Republican plan, as outlined right now, really is centrally about income redistribution, of the reverse Robin Hood variety,” said Austan Goolsbee, a University of Chicago economics professor who was chairman of Obama’s Council of Economic Advisers.
Democrats are framing their argument against the Republican approach in precisely that way.
“If Republicans have their way, working families, older Americans, and people with disabilities will face huge new health costs. Families across America are going to be pushed off their health coverage just so Republicans can hand a massive tax break to the wealthy,” House Democratic leader Nancy Pelosi (Calif.) said in a statement.
By producing their own proposal, Republicans are wandering into a familiar political thicket.
“The problem that the Republicans are going to have is anything they do makes them the inheritor of anger at the health system. That’s not a pleasant place to be, and now, they’re going to own it. All the Democrats know exactly how that feels,” Goolsbee said.
White House press secretary Sean Spicer insisted that widespread dissatisfaction is going to help the Republicans pass their plan to replace the Affordable Care Act. Health-care costs have continued to rise, and in many states, insurance companies are pulling out of the health-care exchanges that were set up under the law.
“What we’ve seen over the last few years with Obamacare is you can have an insurance card, but that doesn’t mean that someone’s going to take it, and it sure doesn’t mean that it’s going to be affordable,” Spicer said.
“When it comes to communication, I think, one of the things that’s really helpful is that part of the sell is done for us,” Spicer said. “We don’t have to explain the problem: People are living it.”
The question now is how to come to grips with the fact that it will not be painless to fix it.