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House Republican Leaders Finally State The Obvious: Obamacare Isn't Going Anywhere

For years, we’ve heard Republicans claim that they want to “repeal and replace” Obamacare with a better set of reforms. (What those reforms would exactly be,...

Forbes|By Avik Roy

For years, we’ve heard Republicans claim that they want to “repeal and replace” Obamacare with a better set of reforms. (What those reforms would exactly be, nobody can say for sure.) But there was always one critical problem with the “repeal and replace” plan: it stands no chance of passage until at least 2017. By then, as many as 35 million people could be on Obamacare-sponsored coverage. A few Republican leaders have had the temerity to acknowledge this fact—and that’s a good thing.
By committing to repeal, Republicans damage their chances in 2016
Most pundits are focused on the likelihood of Republican gains in 2014, fueled by an older, whiter electorate and the unpopularity of Obamacare. But the real prize is 2016. If Republicans can’t retake the White House in 2016, conservatives will have little to no opportunity to shape the future of the health-care entitlement leviathan.
And there’s good reason to believe that Republicans will lose in 2016. Here’s my thinking. In the Republican presidential primary leading up to that election, no aspiring GOP nominee will stray from the “repeal and replace” incantation that has become de rigueur among conservatives. To do otherwise will risk being called a RINO: a Republican In Name Only.
So, a repealer-and-replacer gets nominated by the GOP, much to the satisfaction of conservatives. That nominee runs against Hillary Clinton, whose only campaign ad of the year points out that for the 35 million people on Obamacare-sponsored health coverage, you won’t be able to keep your plan under the Republicans. If 70 percent of those 35 million people vote for Hillary, Republicans lose in a landslide.
Republican politicians won’t admit this out loud, but they are well aware of this problem. And they’re trying, with baby steps, to explain that to the voting public.
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Speaker Boehner: We need to ‘transition’ away from Obamacare
“[Repealing] Obamacare…isn’t the answer. The answer is repeal and replace. The challenge is that Obamacare is the law of the land,” said House Speaker John Boehner at an event in his Ohio district. “It is there and it has driven all types of changes in our health care delivery system. You can’t recreate an insurance market overnight. Secondly, you’ve got the big hospital organizations buying up doctor’s groups because hospitals get reimbursed two or three times [what] doctors [in private practice] do for the same procedure just because it’s a hospital. Those kinds of changes can’t be redone.
“So the biggest challenge we are going to have is—I do think at some point we’ll get there—is the transition of Obamacare back to a system that empowers patients and doctors to make choices that are good for their own health as opposed to doing what the government is dictating they should do.”
Note that key word—transition—which, despite Boehner’s ritual incantation of “repeal and replace,” requires a much less disruptive approach to health reform than repeal and replace can offer.

Majority Leader Cantor: Focus on ‘replace’
House Majority Leader Eric Cantor (R., Va.) has been rolling out a series of policy initiatives, themed “Making Life Work,” that seek to show that conservatives have a policy agenda for people who are struggling in America. According to Brian Beutler, Cantor last week released a memo to House Republicans in which “the word repeal appears nowhere…The GOP platform has speciated, from ‘repeal’ to ‘repeal and replace’ and now ‘replace.’”
This isn’t entirely fair, insofar as Cantor has never disavowed the “repeal and replace” position, and, like Boehner, has frequently called for repeal. But a three-page brief on health policy on Cantor’s website does mention the word “repeal” only once, when it calls for three provisions of Obamacare to be repealed: the excise tax on health insurance plans, the excise tax on medical device manufacturers, and the limits to contributions to flexible spending accounts.

Rep. Cathy McMorris Rodgers (R., Wash.). (Photo credit: Gage Skidmore)

McMorris Rodgers: ‘We need to look at reforming the exchanges’
The kicker came from Cathy McMorris Rodgers (R., Wash.), the fourth-highest-ranking Republican in the House, who was quoted in the Spokane Spokesman-Review on Friday as saying that “we need to look at reforming the exchanges,” in an article claiming that McMorris Rodgers “said it’s unlikely the Affordable Care Act will be repealed.” (The article never actually quotes her as saying this.)
These eminently sensible comments sparked a massive conservative backlash. Ben Domenech writes that what McMorris Rodgers is really saying is that “Republicans are unlikely to beat Hillary Clinton,” and that her comments exemplify “how not to talk about Obamacare.”
McMorris Rodgers’ spokesman was forced to issue a clarification, assuring voters that “the Congresswoman believes Obamacare’s government-centered, one-size fits all approach is not working, and will never work on multiple fronts, which is why she has voted numerous times to repeal it and will continue to work to repeal it at every opportunity.” Blah blah blah.
Technically speaking, McMorris Rodgers isn’t necessarily saying that Republicans are unlikely to beat Hillary. She could be saying that Republicans are unlikely to retake the Senate, or that even a GOP-controlled Capitol won’t have the public support for “repeal and replace,” or that a “replace” plan won’t be filibuster-proof, or that the GOP will never agree on a “replace” plan, making repeal impossible.

‘Repeal and replace’ is not the last hope for conservatives
But as I noted above, there is good reason to believe that a “repeal and replace” approach won’t beat Hillary, because it will be too disruptive of people’s pre-existing health insurance arrangements.
This prospect shouldn’t depress conservatives, however. Indeed, Obamacare’s exchanges—if heavily reformed—could serve as the foundation for sweeping entitlement reform, reform that could expand coverage, lower health costs for most Americans, and make Medicare and Medicaid permanently solvent.
To those frustrated conservatives who think that repealing Obamacare is our last fiscal hope, I say: “No. There is another.”
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INVESTORS’ NOTE: The biggest publicly-traded players in Obamacare’s health insurance exchanges are Aetna AET +1.41% (NYSE:AET), Humana HUM +0.64% (NYSE:HUM), Cigna (NYSE:CI), Molina (NYSE:MOH), WellPoint (NYSE:WLP), and Centene (NYSE:CNC), in order of the number of uninsured exchange-eligible Americans for whom their plans are available.

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Op/Ed 4/29/2014 @ 8:45AM 31,226 views

House Republican Leaders Finally State The Obvious: Obamacare Isn't Going Anywhere

Avik Roy , Forbes Staff

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