The search for elusive common ground on health care reform
The White House presented for health care reform Monday with a good deal of virtual fanfare on devoted to the much-hyped 鈥渉ealth care meeting.鈥� (For the real live show and audience participation/crowd reaction, we鈥檒l have to wait until Thursday.)
The proposal is supposed to be somewhat a compromise between the House and Senate versions of health reform. But it鈥檚 a very familiar kind of compromise in that instead of encouraging both sides to give up something that they want (but is costly), it trims the fiscally responsible pay-fors that make the most economic sense but that politicians (on both sides of the aisle actually) would rather not swallow. In the case of health reform, the number one smartest thing to include is the higher taxation of employer-provided health benefits. The Senate proposal included this feature via an indirect excise tax levied on insurance providers, which was already somewhat of a 鈥渟econd best鈥� solution from an economic perspective because it didn鈥檛 allow the tailoring to households鈥� ability to pay that a tax levied directly through the personal income tax would. The Senate鈥檚 indirect tax, in an attempt to look like it didn鈥檛 burden anyone who wasn鈥檛 truly rich, had already been diluted by exempting all but the most expensive insurance policies, and it wouldn鈥檛 take effect until 2013. But the President鈥檚 proposal reduces the tax further by delaying the tax another five years, to 2018.
If you look at the section on the White House鈥檚 health meeting webpage that highlights the the Administration supports/includes and compare it with the subsection on the aspects of the President鈥檚 proposal for (implying the proposals that actually lower the deficit), you鈥檒l find no overlap. That鈥檚 because the only thing both sides agree on is in cutting things that sound like they鈥檙e just 鈥渨aste, fraud, and abuse鈥� 鈥� which doesn鈥檛 get us far enough to count as 鈥渆nsuring鈥� 鈥渇iscal sustainability.鈥�
Given what the White House reveals/admits on their health meeting webpage, we shouldn鈥檛 expect to be dazzled by all the 鈥渂ipartisan fiscal responsibility鈥� we鈥檒l see on Thursday.
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