Elizabeth Warren Shows Us Why ObamaCare's Cost Controls Won't Work


In an op-ed for a medical device industry trade publication this week, Elizabeth Warren helpfully shows us why some of the health care overhaul's cost controls will fail.

Warren, who is running against Massachusetts Senator Scott Brown for his seat in Congress' upper chamber, writes in Mass Device to argue against the health law's tax on medical device makers. The op-ed justifies this position in terms of encouraging innovation, which Warren says "depends on a fair tax system." And a fair tax system is apparently one that includes industry wishlist items such as repealing the health law's medical device tax and making a separate temporary research and development tax credit permanent. 

Warren apparently does not feel the need to do any innovating herself: Her op-ed is a bland and entirely familiar list of med-device industry talking points presented in a forum aimed specifically at industry players. If not for the byline, the author photo, and a few pro forma lines about respecting federal regulators, it could easily have been authored by a device industry representative.

There's no mistaking what's going on here: Warren is running for Senate in a state with a large medical device industry; she wants their support and is promising something in return. This is standard operating procedure for politicians and wannabe politicians from both parties. 

But it is telling that this progressive champion of higher taxes, who delivers viral mini monologues about the greatness of giving back and paying one's corporate fair share in exchange for valuable government services, can so easily transform her Senate campaign into a vehicle for obvious industry talking points. This is one of the reasons why the cost savings schemes in the 2010 health care overhaul probably won't work. Those provisions generally save money by either taxing someone's benefits (specifically the sort of expensive health plans held by many union members) or reducing someone's payments (higher payments to Medicare advantage plans). Those people, their friends, and their industries all have friendly representatives in Congress, as well as people who would like to be their representatives in Congress—people who will sing whatever tune they believe is necessary in order to win. You can't count on future members of Congress to stick to the cost control schemes dreamed up by past members of Congress, especially if those schemes are disliked by vocal, influential constituencies.