A Popular Conservative Alternative to Obamacare

In a recent piece at New York Magazine, Jonathan Chait writes that “Republican alternatives to Obamacare have lain just over the horizon for half a dozen years" yet somehow never come into view. He asserts, "The reason the dog keeps eating the Republicans' health-care homework is very simple: It is impossible to design a health-care plan that is both consistent with conservative ideology and acceptable to the broader public."

Chait adds, "You can cover poor people by giving them money. And you can cover sick people by requiring insurers to sell plans to people regardless of age or preexisting conditions. Obamacare uses both of these methods. But Republicans…don't want to do either of them."

Chait's statement reflects the liberal conceit that there are really only two choices in this world: Have the government take care of everyone, or do nothing. In truth, there is third way: Fix what the government has broken.

The problems with our health-care system date back 70 years. Before the passage of Obamacare's 2,400 pages of coercive mandates and profligate spending, the federal government had already largely wrecked the market for individually purchased insurance, in three interconnected ways. First, it had effectively established two different health insurance markets—employer-based and individually purchased—by treating them differently in the tax code. Second, it had given an attractive tax break for employer-based insurance while denying it for individually purchased insurance (except for the self-employed). Third, having effectively split the market in two while favoring the employer-based side, it had made it hard for people to move from the employer-based market to the individual market, as it had allowed insurers to treat previously covered conditions as "preexisting."

A popular conservative alternative, then, would repeal every word of Obamacare while fixing this longstanding inequity in the tax code. Indeed, the order is somewhat reversed: With a popular conservative alternative in play—one designed to fix the longstanding inequity in the tax code—Obamacare is ripe for full repeal.