The Obamacare Legacy of Centralization and Bureaucracy

The Obamacare Legacy of Centralization and Bureaucracy
By Kevin Glass
3/21/2011

The monstrous Obamacare health law was passed by the House of Representatives on March 21, 2010 and signed into law by President Obama nine days later. Nancy Pelosi said that Congress had to pass the law to find out what was in it. Despite a lengthy debate, new details trickle out seemingly daily about the destructive impact of the law. One year later, a group of conservative health policy wonks have banded together to release a book that comes as close as possible to being the authoritative tome on the full impact of Obamacare.

Grace-Marie Turner, James Capretta, Thomas Miller and Robert Moffitt are co-authors of the new book Why Obamacare is Wrong For America. Turner, President of the Galen Institute (a health policy think tank) and frequent Townhall contributor, made time to talk with Townhall about her new book, Obamacare's continuing repercussions and what Americans can do to make sure their voices are heard.

Townhall: The title is blunt.

Grace-Marie Turner: It is, I know, there's not any question about where we stand on this.

TH: The book was written by you, James Capretta, Thomas Miller and Robert Moffitt, four of the biggest names in health care policy on the Right. How did this project come together?

Turner: You know, it was really clear to us that there needed to be one book that pulled together the key parts of Obamacare, and that we needed a book that really explained the impact of this awful new law. So rather than descriptions of the bill, which is important, we decided that we needed to do a book about the impact on young adults, on seniors, on patients and doctors, employers and employees, taxpayers and citizens whose constitutional rights are in jeopardy because of this legislation. So we offered this to several publishers, and Adam Bell, who's now our editor at HarperCollins, said "I believe we need this book." We produced it in unbelievable record time. We started it at Thanksgiving, and the manuscript was due at the end of December, so it's very, very current. We've continued to update it through January. Everything is in one place for what people need to know about this legislation and its impact on Americans.

TH: The book is perhaps the most comprehensive overview of what's in Obamacare. What would you say is the biggest impact of Obamacare that's still largely unknown by the public?

Turner: That's such a good question. We know it so well, but it's hard to know what other people know and don't know about it. I think the real risk is that people think that too many people are told that the law really is about some of the early provisions: keeping 26-year-olds on their parents' policies; "free" preventive care (we know there's no such thing as free preventive care); the high-risk pools for the uninsured; and they don't realize this unbelievable avalanche that is coming to take over one-sixth of our economy. It really is the totality: there's no one thing in it.

When you go through 2800 pages of legislation that's going to literally going to control one-sixth of our economy. The number of places in this legislation that give power to the [HHS] Secretary to decide how this is going to be done is totally unprecedented. We wanted to write about what we know already about this legislation and its impact, but also what's coming, and the projections by authoritative, independent experts, and pull it all together in one place. All of us, James Capretta, Tom Miller, Bob Moffitt and me, we write literally every day about this, as do all of our colleagues in the market-based policy community. But what people wanted is one place where they could get the best information about the impact of this law. And we have several hundred footnotes that tell people where to find this information. So even though the book is written for the average reader, it is very carefully documented and cited. This is not just our opinion. this is documented evidence of what the impact of this law is going to be.

TH: You just noted that the law is unprecedented in how it empowers the central government to make important healthcare decision, and that is probably the biggest underlying theme of the book: the trust in centralization and bureaucrats to make decisions about what will lead to healthier outcomes. Could you explain how this is a departure of what you phrase in the book to be "current medical trends towards more individualized and personalized care"?

Turner: Well, it is totally goes in the opposite direction of where the market in health care is going, and where science is taking us. We're moving toward ever more personlized care, where we can find out before somebody starts a round of chemotherapy, for example, whether or not that chemotherapy is going to work with them through genetic testing. That's where science is moving, to make sure that treatments are targeted toward what we can learn about that individual patient.

What this law does is really collectivize, and assumes that we need population medicine. The law claims that experts in Washington are going to figure out what is the right treatment, and what's going to be the protocols. Doctors are going to be judged based on how they follow those protocols whether or not it's the right thing for their patient. So doctors are put into a very difficult position, and one of the things that we talk about is the number of physicians who are seriously considering getting out of the practice of medicine as soon as they can.

The number of doctors who are thinking about retiring early, closing their practices and moving on to something else is astonishing. We are going to have a huge shortage of physicians if we try to put doctors in these boxes. They're saying, "I can't practice medicine according to Washington's rules. I know what's right for my patient." This law is going to absolutely interfere with that. It's astonishing: payment policies, fines on doctors, penalties, likely even lawsuits if they don't follow Washington's protocols.

TH: What really surprised me is the extent that Obamacare treats Medicare as a piggy bank to pay for all of this. The Republicans made a minor issue out of this, but do you think, if all the cuts that are planned go through, that Medicare can even continue to function as an effective program?

Turner: Oh, it absolutely can't. And Rick Foster, who's the chief actuary for Medicare, said that if the cuts in Medicare that are designed to pay for massive new entitlements, if these cuts were to go through, that it would decimate seniors' access to physicians. He says that, over the long term, as many as 40% of providers who treat Medicare patients would either have to stop seeing patients or go out of business. In addition to the doctors who are going to be leaving the practice of medicine so they don't have to follow Washington's protocols, we see that the payment policies are going to drive out a huge number of other providers like nursing homes.

Medicare will be paying less than Medicaid. And we already know that patients on Medicaid have a very difficult time finding a private physician to see them because Medicaid payment rates are so low. And so they wind up having to spend most of their time, if they want to see a physician, waiting for hours in a hospital emergency room, where they're required to be seen. It's just unacceptable that they'll do this to the Medicare program when there are other solutions out there.

TH: It's unclear if you could call it the "bright side," but you write in the book that it's pretty likely that a lot of these Medicare cuts won't actually happen.

Turner: Then you wind up with the impact on taxpayers. Douglas Holtz-Eakin, former director of the Congressional Budget Office, estimates that the number of people who will sign up for these new entitlement subsidies is much larger than the estimates by the current CBO. That's going to add at least a trillion dollars to the cost of this program. You add to that the likelihood that Congress will not allow these cuts to Medicare go into place, and the red ink from this law is absolutely unfathomable. The hypocrisy of this is that they would pretend that this law is designed to reduce the deficit. It will absolutely explode the deficit.

TH: It seems that the choices are destroy the program of Medicare or destroy the deficit.

Turner: Or, as we say in our final chapter when we talk about what we should do instead, figure out how we're going to redesign Medicare and give subsidies to people who need help with emergency health insurance. There's plenty of money in the existing system. But it has to be done in a market-based, competitive approach, rather than the centralized, top-down approach of Obamacare.

It's also going to bankrupt the states! When you go down the line of the implication of the people and taxpayers who are impacted by this law, it is completely unprecedented that we would do this much damage to so many people and such a big swathe of our economy with one piece of legislation.

TH: One of the biggest Medicare reforms in the law is the introduction of Accountable Care Organizations. And you note in the book that these could be used as an effective Medicare reform, but that Obamacare mangles that idea.

Turner: Mangles is really the right word. There is no question that one fo the solutions to the problems in our health care system is to have better coordinated care, particularly for people with significant health costs and multiple chronic illnesses. We need better coordinated care. Right now, the system tosses them around between Medicare and Medicaid, or they go uninsured and they don't get the care they need. The care is fragmented. One doctor doesn't know what the other doctor prescribes. We absolutely need to reform that system. But, once again, Obamacare does it with a Washington-knows-best rules-driven program.

We don't even know the rules, by the way, that the Accountable Care Organizations are going to have to follow. But you know that all of the other regulations so far from Health Secretary Sebelius is that this is a top-down program that will absolutely suffocate the innovation that would be the solution to the problems of fragmentation, lack of coordinated care and waste and inefficiency in our health sector.

TH: There's a lot written in the book about goverment's research into effective spending control measures like the Federal Coordinated Council for Comparative Effectiveness Research and PCORI, the Patient-Centered Outcomes Research Institute. Considering, even without Obamacare, the massive involvement that the government has in paying for health care services, couldn't these be seen as good ideas?

Turner: Well I'd add to that list the Independent Payment Advisory Board. It's this independent board that, without any oversight whatsoever, will have control over payment policies for Medicare. These are centralized agencies. It's important to understand the basic philosophy of the people who wrote this legislation: that they feel like it's really kind of awful for anyone to make a profit in the delivery of health care services. so when you look at this from that perspective, they really want to drive out that competition.

They want to have Washington tell physicians, "this is the way you're going to practice, we're going to set up all these institutions," like the three that we just mentioned. That's only three of 159, at least, that the Congressional Research Sevice says will be created by this legislation.

Absolutely, we agree with the goals: greater efficiency, having physicians know more about what the treatments should be, but that is again something that can be driven by an information age economy, and better incentives for physicians. More transparency, so that the patients know which doctors and hospitals perform best, have the best track record. Instead, this is going to be Washington telling physicians and hospitals, "follow our rules or else."

TH: Something else that was striking in the book was your description of some of the ways that President Obama and the Democrats co-opted what could be promising health care reforms. Like we talked about Accountable Care Organizations, and you go over high-risk pools and the pre-existing condition insurance plan, and say that those could be promising, but that Obama has set them up to fail.

Turner: And that's one of the things they say. They say, "we took your ideas for high risk pools, we took your ideas for refundable tax credits to help people purchase health insurance," but they mangled them beyond recognition. These are not the policies and proposals that we had recommended. Because we believe that doctors and patients should be in charge of decisions. We trust them and the competitive market to figure out how to get better care faster and more efficiently to patients. They simply don't believe in that philosophy.

So there's an underlying philosophy in Obamacare that Washington knows best. And we believe that patients and doctors know best. That fundamental divide has led them to this legislation. It is just completely out of sync with the rest of the economy. And it is a reason that people were literally marching in the streets against it. When Congress was getting ready the last few days of the session to vote on this law a year ago, Congress was getting 100,000 calls per hour. For a switchboard that's only able to handle 50,000 calls an hour, so it was a meltdown. And the great majority were telling their members, please vote against this legislation. There were vigils outside the Capitol literally until the vote was taken, with people saying, "please don't vote for this. Listen to us." And they did it anyway.

It's that philosophy that we're going to completely disregard the American people, that "we're going to do what we know is best for them." And I know I think the American people know what's best for them. That's why they need to know what's in this law. A number of states that have filed for appeals. The House has voted to repeal it. Several courts have declared it unconstitutional. Americans need to know this law is fully in force, and is absolutely coming at us like a steamroller. We're marching toward 2014, when the full impact of this law will be in place.

We have a chapter in the book that tells pepole what they can do to fight back. Many people write to me and ask, "what can we do? This has been passed. And my member of Congress, they're not listening for me." And we have a whole chapter on things that people can do to make sure their voices can be heard. I really hope that, if nothing else, people read the book for that. but I also hope that they really find that the book is important in helping educate them about the details of what's in this law in a way that makes it relevant and accessible to them.

TH: And what do you think the chances are for some kind of repeal or replace of Obamacare, either through the legislature or through the courts?

Turner: This is a multi-front battle at this point. There are now 30 states that are in one way or another challenging this legislation. They know they'll go bankrupt, and they want to protect their citizens from these Washington mandates. The new House is doing a fabulous job with oversight, both bringing Administration officials up to talk about it and business leaders to discuss the law's impact on them.

The political debate continues to rage about this, and you've got Congress trying to take this apart. They've held a vote to repeal one of the most egregious parts of the legislation: the requirement that all businesses file 1099 reporting forms on all purchases over $600. That would have buried over 40 million businesses in paperwork, including mine. And that's gonna go. So you're starting to see the dismantling.

It's hard for me to know, and I don't think anybody has a crystal ball to see, how the Supreme Court is going to come down on this. The political process is continuing to judge this. Back in November, it was a huge, huge motivator for people to go to the polls and vote against anybody who voted for this legislation. Pat Caddell has said, "this is not over." I think the American people's voices will be heard eventually. I don't know how it's going to happen, but I think that they will make sure that this legislation is delayed, postponed and hopefully repealed. But it's going to take a new President to repeal it. That's why the 2012 elections are so consequential.
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To read another article by Kevin Glass about ObamaCare, click here.