Tuesday, February 01, 2011

What happens if conservatives succeed in undermining the ACA?

From Ezra Klein:

The legal theory currently in vogue in conservative circles holds that the Constitution's vision of "a central government with limited power" -- to use Judge Vinson's phrase -- permits the government to establish a single-payer health-care system that every American pays into through payroll taxes and that wipes out the private insurance industry but forbids the government from administering a regulated market in which individuals purchase private insurance plans and pay a penalty if they can afford coverage but choose to delay buying it until they're sick.

There's a chance conservatives will come to seriously regret this stratagem. I think it's vanishingly unlikely that the Supreme Court will side with Judge Vinson and strike down the whole of the law. But in the event that it did somehow undermine the whole of the law and restore the status quo ex ante, Democrats would start organizing around a solution based off of Medicare, Medicaid, and the budget reconciliation process -- as that would sidestep both legal attacks and the supermajority requirement.

The resulting policy isn't too hard to imagine. Think something like opening Medicare to all Americans over age 45, raising Medicaid up to 300 percent of the poverty line, opening S-CHIP to all children, and paying for the necessary subsidies and spending with a surtax on the wealthy (which is how the House originally wanted to fund health-care reform). That won't get us quite to universal health care, but it'll get us pretty close. And it'll be a big step towards squeezing out private insurers, particularly if Medicaid and Medicare are given more power to control their costs.

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