On Obamacare, Congress doesn't know best: Column

As the lead trial counsel for 26 states in their historic constitutional challenge to Obamacare, I was well aware that the purported justification for imposing so drastic a change was that millions of Americans were uninsured. But many who fell into this category were young, healthy adults who were uninsured by choice. The number of uninsurable persons with severe preexisting medical conditions was much smaller. Regardless, their needs could have been met by simply making them eligible for Medicare. (Since its inception in 1965, Medicare has been expanded several times to include various categories of non-elderly Americans who did not fit within the typical insurance paradigm, without disrupting the overall structure of private insurance enjoyed by the rest of us.) But that simple option was rejected in favor of a sweeping, top-down overhaul of our healthcare system that was designed to destroy private insurance en route to a single-payer system, placing the federal government in control of a fifth of our economy.

Now, six long years later, with the election of Donald Trump as president, combined with the Republican Party’s retention of control over both houses of Congress, the time has come to end the Obamacare disaster. Most of the proposals call for repeal and replacement. But the very notion of a “replacement” suggests that Congress would be the body to engineer it, swapping a big-government Democratic Party program for a big-government Republican version. That would be a blunder. The federal government should not be imposing any nationwide plan in the first place. The Constitution does not confer such sweeping authority on Congress, much less on the unelected bureaucrats who undoubtedly would be tasked, as before, to administer the plan. The best answer lies elsewhere.

By far, the best approach would be to redirect most of the federal government’s involvement in healthcare to the states and the private sector, but without imposing rigid parameters — as if Congress knows best, which is the sort of arrogance that has beset centrally-planned economies all along. With that in mind, here are a number of important considerations that should guide our leaders, at both federal and state levels, as we move toward a post-Obamacare tomorrow:

Start by agreeing on the end-vision, then work backwards to formulate the steps needed to transition from here to there over the next two years. As the transitional steps are rolled out, the end vision should be kept in mind, lest ill-considered interim measures undermine realizing the ultimate goal.

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No matter what end-vision is embraced, don’t kill the bottom-up economic freedom that leads to prosperity. Look instead to reduce tax and regulatory burdens on Americans and their businesses, so that we can generate the robust economic growth and excess wealth needed to pay for healthcare that is likely to rise in cost as Americans continue to live longer. That growth will be critically important for enabling us to provide care for the poor and needy — care that impoverished societies simply cannot afford.

The end vision should include a significantly reduced role for the federal government in healthcare. Our constitution was carefully designed to keep political power closer to home, with a federal government of limited powers, and with the states retaining sovereignty over the traditional “police power” for the health, safety, and welfare of the people. There is no legitimate constitutional basis for a centrally planned national healthcare system.

Consistent with the Constitution’s design, Medicaid should first be drastically altered and then quickly phased out. The beginning point should be for Medicaid funds flowing from Washington to be block-granted to the states with no federal strings attached, save that the monies be used for assisting poor and needy persons to purchase health insurance and medical services and supplies as they choose. Moreover, the federal government’s practice of grabbing huge chunks of the income generated by the states’ peoples and businesses, only to return them via grants, should be phased out through reduced taxation, leaving the matter of government’s role in healthcare — and associated taxes and spending — to be decided entirely at the state level.

States then should allow private health insurers to offer coverage on a more rational basis that pleases customers better, with insurance geared toward major medical coverage and with everyday costs borne by the customers. The use of health savings accounts would incentivize individuals to shop around for better value as they incur these costs, leading to significant reductions in hospitals’ and doctors’ charges. For the poor, vouchers to fund health savings accounts would reward them, too, for seeking better value from providers. Congress should enact legislation to promote and protect health savings accounts.

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Congress also should prohibit states from preventing healthcare insurers from operating across state lines. It would be the rare valid exercise of Congress’s power under the Constitution’s Commerce Clause. The clause was designed to empower Congress to referee trade disputes among the states, and thereby prevent states from imposing trade barriers that disfavor out-of-state merchants.

Restore the morality of the market to healthcare by allowing excellence on the supply side to be rewarded on the demand side. This is best accomplished through economic freedom, which empowers providers and insurers to enter markets and compete to offer better quality at lower prices, and which empowers patients to choose those sellers that please them best.

Allow the states to function as the laboratories of experimentation that our Constitution was written to encourage. No one has a monopoly on good ideas, and often we simply cannot know how the best-laid plans will work in the real world. The states are far better positioned to correct errors than is the federal government — as the long-fought campaign to undo Obamacare amply attests.

If a significant number of these steps are implemented by Congress, and if the states react by working with providers and insurers while keeping the consumers’ best interests at heart, we will be amazed at how quickly market forces kick in to bring about huge improvements in the medical sector of our economy. This is what happens when we embrace the morality of the market.

Blaine Winship is the author of Moralnomics: The Moral Path to Prosperity, available in hardcover frommoralnomics.com and in e-books.

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