For conservatives, health-care choice trumps other values

In the crucible that Republicans hope will produce a health-care bill acceptable to at least 50 GOP senators, key conservative values – such as more choice in health plans – are taking precedence over another important one: attitudes about government spending.

Or at least that’s the case with a much-talked-about change to the bill offered by conservative Sen. Ted Cruz of Texas and Sen. Mike Lee of Utah.

The title of their amendment says it all: The Consumer Freedom amendment. It favors the ability to choose no-frills insurance plans instead of being forced to pay a fine or buy a plan with guaranteed benefits that people may not want, as mandated under the Affordable Care Act.

“The most unpopular part of Obamacare is the individual mandate. So trying to provide choices and options that include something that’s attractive to young, healthier individuals I think is important,” Sen. John Cornyn (R) of Texas told reporters on Monday. However, “We’re still trying to figure out … what that costs,” said the No. 2 ranking Republican in the Senate.

And therein lies the potential values trade-off. Because while Senators Cruz and Lee provide an avenue for greater choice, the two senators say insurers would still be obligated to provide plans that meet the Obamacare guarantees, including provisions for preexisting conditions. Helping consumers afford those more generous plans, as Cruz admits, will involve “direct taxpayer funds.”

Because Cruz’s amendment promises lower premiums and more choice, he sees it as a way to unify a deeply divided conference – while still keeping the essential health-care benefits of Obamacare. He is busy selling it to his colleagues this week as Republicans try to finalize a bill and bring it to a vote next week.

Cruz’s plan to lower premiums

Republicans have long tried to curb government spending on health care. The Senate GOP bill’s phase-out of Medicaid expansion under Obamacare and its switch from open-ended federal funding of Medicaid to a cap on funding reflect that priority. The independent Congressional Budget Office estimates that the bill would cut $772 billion in Medicaid by 2026.

“I’m for the amendment, but not for the subsidies that they’re piling on for the insurance companies,” said libertarian Sen. Rand Paul (R) of Kentucky on Fox News on Tuesday morning. “That is not a free-market trade-off,” he said. Senator Paul opposes the bill as it stands.

But in the minds of Cruz and other supporters – including Vice President Mike Pence and key conservative advocacy groups such as the Club for Growth – the benefits of more choice are paramount because, the amendment’s authors believe, that choice will foster more market competition and bring down premiums.

“Let’s focus on lowering premiums,” Cruz said on CBS’s Face the Nation on Sunday. “If we can … give people more choices, more options, more freedom, and lower premiums, that’ll be a win.”

At the same time, he cites “wide agreement” in Congress for “significant assistance” to people with serious medical conditions, and says he would rather have that assistance supported directly by taxpayers than by young people just starting out in life.

“Let’s use Warren Buffett’s taxes and not that of a 28-year-old woman starting her career,” he said on Sunday.

The CBO report also estimated that 22 million more people would be uninsured under the Senate GOP plan by 2026, including an initial 15 million in 2018. However, it assessed that most of those 15 million would be people who voluntarily dropped out as a result of removing the individual mandate.

The death of Obamacare in practice, if not in law

Some Republicans, such as Sen. Jeff Flake of Arizona, like the amendment. The Arizonan sees general taxpayer funding for plans that help people with preexisting conditions as “more efficient” than trying to pay for those costs through a mandate to buy insurance.

Matt Mackowiak, a GOP consultant in Austin, Texas, says Republicans’ willingness to subsidize such plans with taxpayer dollars is a response to the very effective Democratic message that people will lose coverage and die if the Republican Senate plan becomes law.

“I think we have to be compassionate here as a party. We have to address this very emotional concern that people have,” he says.

But other Republican senators are worried that bare-bones plans will also cause harm – because healthy people will flee from the more generous Obamacare plan, leaving behind only people who are the most ill, who would face skyrocketing premiums. Those plans would become unaffordable and useless – the death of Obamacare in practice, instead of through legislation.

If healthy people drop Obamacare plans, “What that means is people who are not getting a significant subsidy or people who aren’t wealthy enough couldn’t get plans,” says Cynthia Cox, an expert on the Obamacare exchange markets at the Kaiser Family Foundation.

Sen. Chuck Grassley (R) of Iowa, who has considerable experience with health-care legislation, warned about “subterfuge” in the Cruz-Lee amendment. “There's a real feeling that that’s subterfuge to get around pre-existing conditions,” he said of the Cruz amendment, speaking to Iowa Public Radio last week. If that’s the case, he added, “I would object to that.”

CBO report due out early next week

No one knows, however, exactly what the cost of the Cruz and Lee amendment would be – in terms of coverage, premiums, or budget dollars. That will be determined by the Congressional Budget Office, when it “scores” the GOP bill, expected early next week. The score on the amendment will be decisive in whether it becomes part of the bill or not.

Even if enough Republican senators were to swing behind the amendment, though, other issues remain. Moderate Republicans are extremely concerned about the bill’s proposed changes to Medicaid. “Add to that the general positive review that Republican governors have of Medicaid expansion,” says Mr. Mackowiak. “A senator never wants to go against their own governor and their own party in a state.” 

Republican leaders want to finish up health care next week and then get started on other business, such as defense spending and the debt ceiling. Unusually, the Senate will work during the first two weeks of August instead of taking a recess, so that it can make a dent in its backlog of work.