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How the GOP doomed itself on Obamacare

Rick Newman
Senior Columnist

The Affordable Care Act has problems, but it was never as dastardly as its Republican critics made it sound. Years of exaggerations and misinformation about the law’s effect on individuals and businesses have now led to a political fiasco for Republicans.

The death of the Senate bill to scale back the ACA probably means Republicans’ 7-year quest to kill the ACA is, itself, dead. The House passed a health bill in May, but without a Senate version, there’s no path forward. President Trump and a few Republicans now want to repeal the ACA outright, even if there’s nothing to replace it with. But if Congress can’t pass an unpopular bill that eases some Americans off health insurance over time, it’s hard to imagine how it could pass a bill that would boot more people off insurance, much more abruptly.

Trump blames Democrats and a few recalcitrant Republicans for the giant embarrassment. Instead, he should blame prominent GOP critics who characterize Obamacare as the source of every problem in the US health system and an albatross on the economy besides. By vastly overstating the negatives of the ACA, Republicans created a mythic Voldemort that could never be tamed; the only option was to slay it at the first opportunity. The GOP forced itself into a doomed, all-or-nothing misadventure when it should have been addressing the problems that affect the most Americans—especially rising costs.

GOP myths about Obamacare

The first myth spun by ACA critics is that the law, which has only been in effect for three years, is the root cause of soaring medical costs most Americans feel. This is nonsense. Medical costs in the United States have been rising far faster than overall inflation for nearly 40 years, which means the typical family has been devoting more and more of its disposable income to health care. Of the 320 million people in America, only about 20 million—6.3%—get health coverage under Obamacare. Most of the rest have been unaffected by the law.

There’s one exception. Roughly 10 million adult Americans buy insurance on their own, without the benefit of an employer plan or Obamacare subsidy. Some of those folks ended up paying more under Obamacare, because of new rules requiring all insurance policies to offer a wide range of benefits not everybody needs. Congress should have addressed this problem, finding some way to offer relief to people who buy their own insurance but don’t qualify for Obamacare subsidies. But the GOP’s slay-the-beast mentality seems to rule out pragmatic tinkering.

The other GOP myth about the ACA is that it’s a job-killing monstrosity. The ACA may have allowed some people to quit jobs they held mainly as a means to obtain insurance coverage. But this is arguably a good thing, not a bad thing, because it gives more people freedom to do what they feel is best for their families — such as stay home with a child — instead of holding a job just for insurance.

It’s also possible some firms are reluctant to hire, because any company with more than 50 workers must offer insurance or pay penalties. But that would only apply to companies on the cusp of exceeding 50 employees, since smaller companies are exempt from the ACA. Even so, employers have created nearly 9 million jobs since the ACA went into effect at the start of 2014—a pace of job growth that exceeds the last non-recessionary period prior to the ACA.

If they weren’t obsessed with the white whale they’ve created, here’s how the Republicans who control Congress could be improving the health care system for millions of Americans: Find ways to make health costs more transparent and consumer decisions more rational. Reduce exorbitant costs for end-of-life care. Extend coverage to the 28 million adult Americans who remain uninsured and often seek treatment in emergency rooms. And give Medicare the right to negotiate drug prices with pharmaceutical firms.

But don’t expect any of that. Obamacare’s not dead yet.

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Rick Newman is the author of four books, including Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman