The big insight on repealing and replacing Obamacare that too many Republicans are missing is that they have the opportunity to enact an Obamacare replacement plan that the overwhelming majority of Americans will find vastly preferable to Obamacare. That is because a strong majority of Americans agree with Republican free-market principles on health policy — individual choice and market competition — rather than the socialized medicine principles of so-called progressives — collective social choice and centralized government regulation.
That is why Obamacare evoked such a strong grass-roots reaction from the start, and Democrats have been losing elections since Obamacare was adopted. Consequently, Republicans have the opportunity now for the most decisive victory on a dominating policy issue since the Civil War. That would be the meaning of the public now overwhelmingly rejecting Obamacare in favor of the Republican replacement plan.
Republicans would be foolish to allow themselves to be reduced to inaction by Democratic scare tactics about how voters will punish them for taking away their Obamacare “benefits,” which all can be far better provided through intelligently constructed free-market individual choice and competition.
Just the simple repeal of Obamacare would immediately begin to implement the public’s preferred principles. Both the job-killing employer mandate and the middle-class-killing individual mandate would be immediately gone through simple repeal. So would all the other federal regulations imposed by the Obamacare law that have done so much to increase health insurance costs, which made the Affordable Care Act so unaffordable for the middle class and working people, contrary to the original promise of the law.
Workers and their employers would consequently be immediately liberated to purchase the health insurance they each prefer, rather than forced to buy the costly health insurance the government insists they must buy. That is why President Obama’s promise that if you like your health insurance, you could keep your health insurance, turned out to be something very different: If he liked your health insurance, you could keep it.
And that is why the health insurance for close to 5 million Americans and rising was canceled as the Obamacare mandates started to become effective, leaving them only with the choice of paying more for effectively less coverage, considering the steep deductibles under Obamacare insurance. Those steep deductibles without the protection of Health Savings Accounts leave most families feeling effectively uncovered.
With cost-increasing federal regulation of health insurance repealed, the states would be immediately liberated to reassert their traditional role in health insurance regulation, which has generally been far more effective and sensible, restricted as they are by the natural competition of federalism. Those Democratic-controlled states that have adopted their own versions of costly Obamacare regulations would be suddenly exposed to this federalist competition, creating new opportunities for Republicans in those states to win governorships and legislative control. That would substantially advance the ultimate Republican goal of 50 Republican governors and 50 Republican-controlled state legislatures.
With reasonable and sensible state regulation replacing cost-raising federal regulation, health insurance premiums would immediately go down in most states, applying to the great majority of Americans. Moreover, all of the Republican Obamacare repeal bills have uniformly abolished the Obamacare net investment income tax, which sharply increased the capital gains rate and the tax rate on corporate dividends. Republican repeal of Obamacare would consequently involve an immediate, major, pro-growth, pro-jobs tax cut.
Several other highly appealing elements should be included in a follow-on replacement bill, including a universal health insurance tax credit, block grants for Medicaid, and expanded Health Savings Accounts, among other highly appealing elements.
[Originally Published at the Washington Times]
Peter Ferrara, J.D., is a senior fellow at The Heartland Institute and an advisor for entitlement reform and budget policy at the National Tax Limitation Foundation.
