Wednesday, May 16, 2012

Don Taylor envisions a distant healthcare compromise; might Justice Kennedy impose something like it next month?

At present it would seem that there is no common ground between the parties on healthcare -- though the Democrats built the ACA on Republican ground, which the GOP fled (and rhetorically bombarded) as soon as the Dems set foot on it.

Nonetheless, looking down the road and seeking the contours of a future compromise, Don Taylor, in his new book Balancing the Budget is a Progressive Priority, identifies Democrats' top priority as universal coverage, and Republicans', insofar as they have one, as ensuring that everyone has "skin in the game," i.e. is on the hook for some of the medical expense they generate.  He therefore envisions this future deal:
  • Universal catastrophic coverage implemented through Medicare, with gap insurance available to persons wanting it (no mandate!) via state based exchanges
  • With a massive deductible (I suggest $10,000/persons; $15,000/family to maintain a key role for private insurance; far larger out of pocket exposure than Bronze level cover in the ACA)
While such further compromise might strike most progressives as equal parts unlikely and undesirable, it caught my eye because, as I have noted repeatedly, there's an outside chance that Justice Kennedy (as swing vote) may impose something akin to it in the Supreme Court's ruling on the constitutionality of the mandate.

In oral argument, Kennedy seemed troubled by the notion that the mandate was "unprecedented" in imposing "the affirmative duty to act to go into commerce" but also acknowledged that "the young person who is uninsured is uniquely proximately very close to affecting the rates of insurance and the costs of providing medical care in a way that is not true in other industries." Responding to Kennedy's ambivalence, Marty Lederman,  former deputy assistant attorney general in the Obama administration's OLC, suggested both a "bounded, minimalist way to uphold the ACA" -- uphold the power to impose such a mandate only in the case of the unique characteristics of the healthcare/health insurance market that Kennedy seemed to acknowledge -- or else a way that Kennedy might further limit the mandate (if convinced that the scope of the mandate exceeded the economic need):
Moreover, even if Randy and Mike Carvin were correct, and the preventive care coverage could not be justified under my proposed, or any other, limited holding, that would only mean that the Court should declare invalid those subsections of section 18022(b) that go beyond coverage for catastrophic care and other services that are government-guaranteed. Such an excision would likely have, at most, only a marginal impact on the cost of insurance premiums, since it is of course catastrophic and longterm care--the services the state and federal governments guarantee--that account for the lion's share of uncompensated health care costs, and of the cost of health insurance (my emphasis).
I have argued that the plaintiffs misrepresented the scope of the mandate, and that the conservative justices seemed unaware that  a) the ACA provides a catastrophic coverage option for those under 30; b) that it extends that option to others exempt from the mandate on financial or other grounds; or c) that the bronze plans offered in the exchanges, as the Kaiser Family Foundation recently detailed, might also reasonably be labeled "catastrophic" coverage.  The mandate, in other words, is self-limiting.  But were it further limited, that would not preclude making more comprehensive coverage available at subsidized cost.

More on catastrophic coverage in the ACA and misrepresentation of the mandate in the Supreme Court
On the mandate more broadly
The individual mandate is a piece of Cake (4/25)
Verrilli's limiting principles (4/24)
If only Verrilli had said (A, B, C) (3/31)
Verrilli, slapped silly, recovers willy-nilly (3/28)
External links
Patient cost-sharing under the Affordable Care Act (Kaiser Family Foundation. 4/27)
Will the justices make a catastrophic error? (Jonathan Cohn, 4/19)
Policy ignorance at the Supreme Court (Steve Benen, Maddow blog, 4/16)
Supreme Court misunderstanding on health overhaul? (AP's Ricardo Alonso-Salvidar, 4/10)
The bounded, minimalist way to uphold the ACA (Marty Lederman at Balkinization, 4/2) 
Ragbatz on the catastrophic coverage options in the ACA - a healthcare attorney picks up the plaintiff's con in real time ( 3/28)

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