Resolved: Obamacare Is Now Beyond Rescue

Megan McArdle:

Last Wednesday, Scott Gottlieb and I debated Jonathan Chait and Douglas Kamerow on this proposition: “Resolved: Obamacare Is Now Beyond Rescue.” I was feeling a little trepid, for three reasons: First, I’ve never done any formal debate; second, the resolution gave the “for” side a built-in handicap, as the “against” side just had to prove that Obamacare might not be completely beyond rescue; and third, we were debating on the Upper West Side. Now, I grew up on the Upper West Side and love it dearly. But for this particular resolution, it’s about the unfriendliest territory this side of Pyongyang.

Nonetheless, I greatly enjoyed the debate. I’m not ashamed to admit that the other side had a lot of powerful moments. Kamerow, a doctor who is also a former assistant surgeon general, made good points about the problems with the previous status quo. In the other seat, Chait was as passionate, witty and well-reasoned in his arguments as ever. (You can read his account of the debate here.) Given the various difficulties, we went in assuming that we would lose, so we were pretty surprised and pleased when we won.

What was the winning argument? We argued that the Patient Protection and Affordable Care Act is an unstable program that doesn’t deliver what was expected. For a lot of people, that hardly needs proving, given all the recent technical and legal gyrations. But for others, it does, and because most of them weren’t at the debate, let me elaborate. Scott spoke eloquently about the ways in which narrow networks and the focus on Medicaid are going to deliver an unacceptable quality of care. I talked about why this, among other things, makes the system so unstable.

In a nutshell, Obamacare has so far fallen dramatically short of what was expected — technically, and in almost every other way. Enrollment is below expectations: According to the data we have so far, more than half of the much-touted Medicaid expansion came from people who were already eligible before the health-care law passed, and this weekend, the Wall Street Journal reported that the overwhelming majority of people buying insurance through the exchanges seem to be folks who already had insurance. Coverage is less generous than many people expected, with narrower provider networks and higher deductibles. The promised $2,500 that the average family was told they could save on premiums has predictably failed to materialize. And of course, we now know that if you like your doctor and plan, there is no reason to think you can keep them. Which is one reason the law has not gotten any more popular since it passed.

The administration and its supporters have been counting on the coverage expansion to put Obamacare beyond repeal. So what if the coverage expansion is anemic, the plans bare-bones, the website sort of a disaster? It’s a foundation upon which we can build — and now that so many people have coverage, the thinking goes, Republicans will never dare to touch it. The inevitable problems can be fixed down the road.

But it’s far from clear that this is true. The law is unpopular, not only with voters, but also apparently with the consumers who are supposed to buy insurance. The political forces that were supposed to guarantee its survival look weaker by the day. The Barack Obama administration is in emergency mode, pasting over political problems with administrative fixes of dubious legality, just to ensure the law’s bare survival — which is now their incredibly low bar for “success.”

Although the fixes may solve the short-term political problems, however, they destabilize the markets, which also need to work to ensure the law’s survival. The president is destroying his own law in order to save it.

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