Paul Krugman: One Reform, Indivisible

Republican leaders who promised that Obamacare wouldn't work, and that it would be reversed, are headed for a big disappointment:

One Reform, Indivisible, by Paul Krugman, Commentary, NY Times: Recent political reporting suggests that Republican leaders are in a state of high anxiety, trapped between an angry base that still views Obamacare as the moral equivalent of slavery and the reality that health reform is the law of the land and is going to happen.

But those leaders don’t deserve any sympathy. For one thing, that irrational base is a Frankenstein monster of their own creation. Beyond that, everything I’ve seen indicates that members of the Republican elite still don’t get the basics of health reform — and that this lack of understanding is in the process of turning into a major political liability.  ...

So let me help out by explaining, one more time, why Obamacare looks the way it does.

Start with the goal that almost everyone at least pretends to support: giving Americans with pre-existing medical conditions access to health insurance. Governments can ... require that insurance companies issue policies without regard to an individual’s medical history... But we know what happens next: many healthy people don’t buy insurance, leaving a relatively bad risk pool, leading to high premiums that drive out even more healthy people.

To avoid this downward spiral, you need to induce healthy Americans to buy in; hence, the individual mandate, with a penalty for those who don’t purchase insurance. Finally, since buying insurance could be a hardship for lower-income Americans, you need subsidies to make insurance affordable for all.

So there you have it: health reform is a three-legged stool resting on community rating, individual mandates and subsidies. It requires all three legs. ...

You see, this thing isn’t going to be the often-predicted “train wreck.” On the contrary, it’s going to work.

Oh, there will be problems... But the basic thrust of Obamacare is, as I’ve just explained, coherent and even fairly simple. Moreover, all the early indications are that the law will, in fact, give millions of Americans who currently lack access to health insurance the coverage they need, while giving millions more a big break in their health care costs. And because so many people will see clear benefits, health reform will prove irreversible.

This achievement will represent a huge defeat for the conservative agenda of weakening the safety net. And Republicans who deluded their supporters into believing that none of this would happen will probably pay a large personal price. But as I said, they have nobody but themselves to blame.