AHLAlerts: American Health Line’s Blog

by Kathryn Nix of The Heritage Foundation‘s “The Foundry“

Editor’s Note: This is one in a series of guest posts on AHLAlerts, wrapping up the year in health policy and looking forward to the year ahead.

The Patient Protection and Affordable Care Act became the law of the land in 2010, but debate over its existence and implementation will rage on in the New Year. Critics point to the serious policy flaws that are already impacting health insurance and costs, but these are part of a deeper and broader issue: the proper role for the federal government in Americans’ health care. The public’s stance on this issue has been anything but settled in the wake of the new law’s passage.

As ramifications of the new law (known as ObamaCare) continue to play out, it becomes clearer that the changes made are the wrong ones. The new law cuts $575 billion from Medicare, but uses the savings to fund a new health entitlement, rather than deal with the financial insolvency that Medicare faces. “Bending the cost curve” was one of ObamaCare’s original goals, but Medicare’s actuary reports that the new law instead bend the curve in the opposite direction.

Furthermore, countless employers have said the new law accelerated increases in their health insurance premiums, prompting them to consider dropping coverage or pass more of the cost on to employees and their families. Mandates and new regulations are likely to further inhibit businesses’ ability to offer health insurance to employees, and also threaten to negatively affect the economy at large. Finally, when the law comes fully online and the true costs are accounted for, ObamaCare is expected to significantly increase the nation’s deficit spending.

But the debate extends beyond these policy errors and into the realm of the federal government’s rightful role in health care. ObamaCare significantly increases Washington’s influence over every aspect of the U.S. health care system — not just in the insurance market, but right down to the patient’s bedside. Medicare beneficiaries will be especially affected by the creation of new bureaucratic entities and top-down, cost-containing mechanisms included in the law.

Meanwhile, Americans continue to oppose parts or all of the new health reform law. Pollsters like Rasmussen show that Americans’ support for repealing ObamaCare has ranged from 50% to 63% since the law’s passage. In November, American voters chose to send a wave of new lawmakers to Congress, many of whom campaigned in support of repealing the law. The provisions in ObamaCare are not consistent with what Americans want, strengthening the case for repeal and a new direction for health care reform.

So what’s the alternative? Reform should transform the health care system to strengthen individuals’ control over their health care spending and decision-making. Patients, including those covered by Medicare and Medicaid, should have the opportunity to choose health care plans in the private insurance market that best suit their needs.

Market-based reforms would foster greater competition among insurers and more choices for consumers, enabling them to seek out the best value for their dollar. This bottom-up approach to reform would reduce health care costs while maintaining the quality of care available in the United States. It would put doctors and patients, not Washington bureaucrats, in charge.

As the conversation continues, plans that embody these principles are gaining greater traction. U.S. Rep. Paul Ryan’s “Roadmap for America’s Future” would drastically change Medicare, Medicaid, and the health care system at large, to put patients in the driver’s seat. Ryan and Alice Rivlin, both members of the National Commission on Fiscal Responsibility and Reform, together offered a similar plan for Medicare and Medicaid that would replace the highly centralized, bureaucratic system with a defined-contribution program, offering beneficiaries greater autonomy.

In 2011, Americans can expect health care to remain a top issue. The push for repeal will remain strong not only to undo the disastrous consequences of ObamaCare, but as the first step to reform that will fix the health care system without expanding government control of Americans’ health care.

Kathryn Nix is a Research Assistant for The Heritage Foundation’s Center for Health Policy Studies.