While the Republican presidential field is beginning to look like the pledge class in Animal House, there are still Republicans making sense and thinking boldly. Today, Rep. Paul Ryan (R-Wis.) went to the Hoover Institute to talk about healthcare. He stated with some restraint: “The political hurdles that stand in the way of real, structural health-care reform are daunting. And while Republicans have advanced many good ideas on health care, it is my candid opinion that the party as a whole has yet to coalesce around a complete reform agenda aimed at dealing with the underlying problem, which is runaway inflation in the cost of health care.”
In fact, the party has done precious little to advance an intelligent discussion. But Ryan presented a template for thinking about healthcare:
First, we know we will have the opportunity to enact reforms. Even before the President’s law made matters worse, Americans faced serious problems in health care – and we cannot simply revert to the status quo.
In the wake of repeal, we must be ready to advance solutions. To get the prescription right, we need to properly diagnose the problem – starting with the reasons that the President’s law is such a failure.
At its core, the health care problem is one of inflation, driven by the overutilization of services, dramatic underpayments, and massive inefficiency.
If you look closely, the reason is easy to see: The health care sector lacks most of the basic building blocks of a functioning market. . . .
Rather than tackle these root drivers of the problem, the President’s law goes in the other direction. It expands broken government programs, enhances bureaucratic control, and imposes flawed mandates that will continue to drive up the cost of health care.
Ryan doesn’t demagogue, but he does point out that, as a result of failing to address the underlying costs of healthcare, Obama’s plan leaves us with rationing:
Just last week, the President rolled out a deficit-reduction plan that doubled down on his bureaucratic approach to controlling Medicare costs, first advanced in his health-care law last year.
The law empowers a board of 15 unelected officials – the Independent Payment Advisory Board, or IPAB – to hold the growth of Medicare spending to GDP plus 1 percent by reducing reimbursements to health-care providers. Unless overturned by a supermajority in Congress, the recommended cuts dictated by this board become law.
The President’s latest proposal simply called for letting IPAB cut deeper. This board of bureaucrats will now be tasked with holding Medicare’s growth rate to GDP plus half a percent. To put that in context, Medicare is currently growing at 6.3 percent per year.
Medicare’s non-partisan chief actuary, Richard Foster, has been clear on this point: Going from 6 percent growth down to the President’s targets, using only the blunt tools that his law gives to IPAB, would simply drive Medicare providers out of business, resulting in harsh disruptions and denied care for seniors.
In fact, the deterioration in seniors’ care that is projected to occur under IPAB would be so untenable, the board is unlikely to yield any savings at all. Future Congresses would be under tremendous pressure to undo the cuts, just as past Congresses have time and again reversed scheduled cuts to physicians’ pay.
Whether we are talking about Medicare, Medicaid or the health system more generally, “The solution in each of these areas is to move away from defined-benefit models and toward defined-contribution systems. Under a reformed approach, the government would make a defined contribution to the health-care security of every American, rather than continue to offer open-ended, well-intentioned, but ultimately empty promises. . . . In other words, defined contributions should underpin a system driven by patient choice and centered on patient needs – one that offers real security instead of empty promises.”
He then goes on to sketch out the elements of each of these segments of the healthcare system. He concludes with a plea for courage:
The three reforms I’ve just outlined – premium support for Medicare, block grants for Medicaid, and tax reform to correct the inefficient tax treatment of health insurance – must be present in our “replace” agenda.
If we end up with a replace agenda that fails to fix the problem, then we will lose hard-won credibility on the health-care issue as a result.
Look, I understand how daunting the politics of these issues are. I’ve lived them, so I know that the political hurdles to real reform are great. But we can clear these hurdles if we combine political courage and clarity of purpose with faith in the American people. . . .
Fear and demagoguery are the last refuges of an intellectually bankrupt party – and the moment calls for leaders who are not afraid to be honest with people about how they would solve the problems we face.
In health care, we owe the American people a defining choice, and that choice is: Who is in charge: The government or the patient?
Ryan has spent years working on these issues, and it shows. So if there is a presidential candidate who can supply the courage, why not simply adopt this as the agenda for his candidacy? There is no harm in using others’ ideas; that’s the essence of executive leadership. So how about it? Let’s see who has the nerve and the brains to say, “Sign me up!” That’s the sort of person whom voters wouldn’t have to just “settle” for but whom they’d be proud to support.