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Avik Roy: 2020 Democratic Debate Reveals Flaw in GOP's Anti-Single-Payer Message

In the first Democratic presidential debate of the 2020 cycle, candidates proposed a number of far-left ideas. But when Lester Holt asked, “Who here would abolish private health insurance in favor of a government run plan?” only two raised their hands: Elizabeth Warren and Bill De Blasio.

It was a new stand for Warren, who previously had been vague on whether she supported the abolition of private insurance. But the most significant aspect of the episode is how it highlighted the flaws in Republicans’ strategy on health care.

It has been tempting for Republicans to default to their traditional posture of complaining about what Democrats want to do on health care rather than proposing their own ideas. Hence all the op-eds and speeches from leading Republicans about the perils of so-called “Medicare for All” single-payer health care.

The hitch in the GOP strategy is that only a minority of Democratic presidential candidates — Bernie Sanders, Kamala Harris, De Blasio, and now Warren — have explicitly supported the abolition of private insurance. The remaining candidates have expressed support for measures that are relatively more incremental, such as installing a government-run “public option” health insurer that would compete with private insurers in the individual and employer-sponsored markets.

These public-option-based approaches, whatever their flaws, are more clearly targeted at the problem that most Americans care about: the extremely high cost of U.S. health care. Public-option plans are usually designed to pay hospitals and doctors at Medicare’s reimbursement rates. Because private insurers are forced to pay hospitals at exaggerated rates, private-insurer premiums are higher than what a plan paying Medicare rates would charge. That is to say: A public option would offer lower premiums and lower deductibles to the average consumer than the typical private health-insurance plan does.

While panelists on cable news go on about “socialism,” the public option is the far more likely encroachment upon a private-sector, market-based health-care system. A recent poll found that even Republican voters favored the creation of a “new government health insurance plan” by a margin of 44–32 percent. Republicans and conservatives need to get serious about reducing the cost of Americans’ health care, particularly when it comes to hospital care and prescription drugs, or they will find themselves once again on the losing end of an important health care debate.

There are encouraging signs. President Trump’s recent executive order on health-care price transparency, and a related bipartisan bill from the Senate Health, Education, Labor, and Pensions Committee, could open up anti-competitive hospital pricing practices. The Trump administration has been doing serious, and underappreciated, work to reduce prescription-drug prices. And Arkansas representative Bruce Westerman’s Fair Care Act is the most robust legislative approach yet developed in Congress to reduce hospital and drug costs through competition.

But this key issue — lowering the cost of American health care — has to be front and center in Republicans’ thinking about the 2020 election. If it is not, we may wake up in November 2020 and find it is Democrats, not Republicans, who are more in touch with voters’ economic concerns.

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Posted: June 27, 2019 Thursday 09:38 AM