Heritage Foundation: Don't Blame Us for Obamacare


"The Obama health-care law 'builds' on the Heritage health reform model only in the sense that, say, a double-quarter-pounder with cheese 'builds' on the idea of a garden salad, writes the Heritage Foundation's Robert Moffit. "Both have lettuce and tomato and may be called food, but the similarities end there." Moffit is objecting to President Obama's citation of Heritage research in support of the Patient Protection and Affordable Care Act:

It began when President Obama told "Today" show host Matt Lauer on March 30 that "a lot of ideas in terms of the exchange, just being able to pool and improve the purchasing power of individuals in the insurance market, that originated from the Heritage Foundation."

First, Heritage did not originate the concept of the health insurance exchange. Furthermore, the version of the exchange we did develop couldn't be more different than that embodied in this law…

For us, the health insurance exchange is to be designed by the states. It is conceived as a market mechanism that allows individuals and families to choose among a wide range of health plans and benefit options for those best suited to their personal needs and circumstances…

Under the president's law, however, the congressionally designed exchanges are a tool imposed on the states enabling the federal government to standardize and micromanage health insurance coverage, while administering a vast and unaffordable new entitlement program. This is a vehicle for federal control of state markets, a usurpation of state authority and the suppression of meaningful patient choice… This is probably not something President Obama gives a whit about, but we at Heritage do.

The other charge—repeated on this page and elsewhere—is that the federal individual mandate in Obama's health-care plan came from us.

For the record, we think that the law's federal mandate is unconstitutional…

Yes, in the early 1990s, we, along with other prominent conservative economists, supported the idea of such a mandate. It seemed the only way to solve the "free-rider" problem, in which individuals can, under federal law, walk into any hospital emergency room nationwide and rack up big bills at taxpayer expense.

Our research in the ensuing two decades has led us to realize our initial idea was operationally ineffective and legally defective. Well before Obama was elected, we dropped it.

Note that Reason too has flirted with the idea of the individual mandate, but the president refuses to give us a shoutout.

A couple points:

1. While a think tank needs to be conducting thought experiments, this is why it was always a fool's errand to try and compromise between the goal of universal health care and the system of insurance-based health coverage (and especially the satanic permutation of employer-based health insurance that Obamacare effectively renders immortal). In the few small cases where universal coverage could realistically be said to have occurred—as for example in Mayor Gavin Newsom's Healthy San Francisco program—it has happened because the provider moved outside of the insurance model entirely. You can argue about the success of such programs, or even whether universal coverage is a worthwhile goal. But insurance can not be and will never be the vehicle that gets you to universal coverage.

2. Conservatives gave health care reformers plenty of ammunition by harping on the serious but not life-threatening "free-rider" problem. By exaggerating the costs of uninsured patients, and particularly by presenting fanciful schemes wherein earlier care would prove cheaper than having people "forced to turn to expensive emergency room care," California Gov. Arnold Schwarzenegger was able to claim that his abortive 2007 universal coverage plan would end up saving the state money. No matter how hard Schwarzenegger's eggheads tried to monkey with the figures, those numbers never made a syringeful of sense, but the case was helped (unwittingly) by immigration hawks telling horror stories about illegal immigrants swamping emergency rooms. Fortunately Schwarzenegger's reform ended up failing anyway, but Obama went on to make the case that universal coverage would somehow end up saving money. It's like saying if you give a freeloader your credit card he'll stop costing you money. Sadly, in this case—possibly for the first time in history—the nation as a whole turned out to be even dumber than California.

Related: Tom Bosley: Stop confusing me with David Doyle.