Obamacare

Sorry, Liberals: Obamacare Won't Lead to Single Payer

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Whitehouse.gov

If you spend any significant amount of time talking to conservative activists who oppose Obamacare, you'll eventually hear some variant on the theory that Obamacare was never meant to work. Instead, it was meant to destroy the existing health care system, and in the process pave the way for liberals to step in with the comprehensive health care fix the far left has always really longed for: single payer. 

There's often a hint of conspiracy surrounding the accusation, as if President Obama and the White House senior staff had hatched some meticulous plot to spend a year struggling to pass a health care law that they intended to fail in a series of carefully planned disasters sometime down the road, which would create the perfect opening for their true, secret goal.

I've always thought the notion was rather far fetched. Obamacare was a stalking horse for a modified version of Obamacare, not a single payer conspiracy scheme. But The New Republic's Noam Scheiber suggests that conservative activists worried that Obamacare will lead to single payer might be at least partially onto something—maybe not in their belief that Obamacare was explicitly designed as a gateway to single payer, but in their worry that the health law will eventually lead to some sort of nationalized health system. And unlike those concerned conservative activists, Scheiber thinks this is a good thing.

The gist of Scheiber's theory (delivered in response to a griping Michael Moore op-ed about the health law  in The New York Times) is that the law will create a unified, organized constituency for change. Private coverage in the exchanges will be too expensive for many, and dealing with private insurers will upset some beneficiaries. That will make existing government run health insurance options more attractive. "By pooling millions of people together in one institutional home—the exchanges where customers buy insurance under Obamacare—the Affordable Care Act is creating an organized constituency for additional reform," he writes.

I don't doubt that as Obamacare's flaws continues to be exposed, liberals like Scheiber, as well as a some Democratic legislators and even presidential candidates, will push for a single payer overhaul. But I don't think it's likely to happen in the forseeable future.

For one thing, it assumes that irritation with Obamacare—a law designed and implemented exclusively by Democrats—will somehow generate public support for additional Democratic health legislation that is even more sweeping. But judging by the beating Democrats have taken at the polls over last few months, public frustrations with Obamacare will turn the electorate toward Republicans. Democrats won't be given a second chance, with a mandate to do even more.

Scheiber's theory also overlooks how tough passage of Obamacare was in the first place—and how much support the administration had to get from health industry stakeholders in order to eke out a legislative victory. Single payer would be even tougher. Moderate Democrats who were nervous about Obamacare the first time around would be even less likely to support single payer, especially given how the law cost Democrats at the voting booth. And there's no way that doctors, insurers, hospitals, and other major health industry groups would play nice with a single-payer push. Quite the opposite: Even beyond the insurers, much of the industry would see single-payer as a de facto nationalization of the health system, and they would fight the transition with everything they could muster.

Finally, Scheiber's argument rests on the odd idea that individuals with private coverage will become jealous of people with Medicare and Medicaid.

I might be willing to believe that some people would prefer Medicare to private coverage, but Medicaid isn't going to become a consumer favorite any time soon. Here's Scheiber:

There's the likelihood that, one day soon, especially if Medicaid becomes more generous, the working-class person who makes 175% of the poverty level will look at his working-class neighbor making 130% of the poverty level and think, wow, his health insurance seems a lot better than my private Obamacare plan.

That's some rather wishful thinking. For starters, Medicaid isn't likely to become more generous: State budgets are already straining under the burden of Medicaid spending, and the federal budget squeeze means that it's more likely that the federal share of the program will be cut back. Meanwhile, it's hard to imagine someone with private health insurance looking jealously at a program that has no statistically significant effect on physical health outcomes and that has even been found, in a couple of narrow instances, to produce health outcomes that are worse than no insurance at all.

Might Obamacare lead to a handful of state-level experiments with single-payer variants? Possibly, although that mostly means that very liberal states with heavily consolidated insurance markets will explicitly transform their insurance industries into public utilities. 

There's a weird overlap between conservative fears and liberal hopes when it comes to single payer: Both seem to think that Obamacare makes a universal government-run system more likely. But both are wrong.