Hyperventilating On Obamacare Expansion


Steve Albertson over at The Bull Elephant takes the bait on the talking point that have been circulated to Virginia conservative bloggers this week, and the target?  Well… McDonnell staffers:

The “reform then expand” mantra is just spin intended to make it seem like McDonnell and certain other Republican leaders are against Medicaid expansion, while leaving a back door open for expansion to happen (i.e., “reforms” that would either let them call the expansion by another name, or that would save enough money to cover the eventual drop in federal support for the expanded coverage).

That’s pretty much the meat of the post.

Here’s what’s going on folks:

(1)  Medicaid expansion is really Obamacare expansion.  We all know it — Obamacare can’t survive unless it corrals more people into state-subsidized health care.  It is dead, dead, dead, dead without it.  Anything that sucks the oxygen out of the room is good, good, good.

(2)  …but a free-market alternative is being floated that would keep the zombie from coming back in 2015.  That alternative?  Health Savings Accounts (HSAs) linked with high deductible insurance plans (HDIPs) that create tax havens for employers and employees, while making sure those who are either freeloading because they don’t need health insurance (i.e. Millennials) or those who cannot afford a traditional plan get decent coverage.


(3)  Hospitals are the target.  Little known fact — we do not have universal health coverage in America, but we do have universal health care.  That means that under Obamacare, hospitals are the ones getting their butts kicked around the block, and looking at closing as a result.

(4)  BTW, did I mention that I am not forced to pay for contraceptives under a Health Savings Account?

That last part right there — good ol’ #4 — is what is the crux of the problem.  Yes Virginia, there are some that would love to put contraceptives into the hands of poor people and minorities… at any cost.

HSAs prevent that.  The “repeal and reform” crowd and the “leave the status quo be” crowd?  Well… they have different priorities, some of which is genuine, some of which is overtly hostile to pro-life values and health care rather than health administration under a different, more corporate guise.

The Virginia Chamber of Commerce has proposed an exchange that would be entirely free market driven, prevent the Democrats from engineering a crisis and imposing a $7 billion tax grab, and prevent the HHS Mandate from imposing it’s grip on Virginia taxpayers and pro-life families.

…and there it is.  Those are your battle lines.

Just one fly in the ointment?  The federal government has said that HSAs are a non-starter.  So this might all be a moot point or a chasing for glory.  Nevertheless, if there’s a path to health care coverage that is market-driven that prevents Obamacare from taking root much less imposing the HHS Mandate?  I am perfectly on board with that.

…and if it turns into Obamacare expansion?  I’ll turn on it like a junkyard dog.


UPDATE:  Justin Higgins joins in on the hyperventilation… and this adds a curious twist to the whole discussion:

Recently, however, a “third way” has surfaced in an effort to entice conservatives to support Obamacare coming to Virginia in one way or another. The Healthy Virginia Works (HVaW) proposal is getting some traction, with Bearing Drift blogger Shaun Kenney endorsing the plan and former aides to Governor Bob McDonnell doing a hefty share of the lobbying.


So apparently, I have dreamt all of this HSA/HDIP stuff up and am lobbying (is that possible) for full blown Obamacare expansion.  Because you know… that’s what I wrote up top.

Here’s where it gets interesting.

Clearly there’s an alternative out there that sees HSAs and HDIPs as an alternative to coverage — Bearing Drift readers and a good portion of our writers get that, because it’s been Republican orthodoxy for the last decade or so.  Yet there remains the kneejerk reaction to it for some reason.  Why?

Arguments that have been proffered so far:

(1)  HSAs are a stalking horse for Medicaid expansion.  Which is kind of impossible… given that Medicaid expansion wouldn’t impact HSAs one whit.

(2)  HSAs are a bait and switch for Medicaid expansion.  Which is also impossible, because Speaker Howell’s office has stated quite emphatically that the federal government will not allow it, ergo it is not an option.  Can’t have a switch without some bait…

(3)  HSAs and HDIPs won’t fix the problem.   There might be some merit to this argument… but keep in mind that there are two components to this: getting lower income families who can’t afford traditional coverage an alternative to expensive traditional health care programs, and getting the 18-29 demographic who can afford it but choose not to purchase.  Democrats know that this is really about using the former to achieve the latter, thus building a constituency for a single-payer system when this all fails in 5-10 years.  Republicans (or at least conservatives) know that if you do HSAs and HDIPs, it cuts the argument right out from underneath the Democrats’ legs.  If they reject HSAs, then what we’re really talking about here is government expansion — not health care.  If they accept it… then the need for Obamacare evaporates.

(4)  …but this isn’t what is on the website!  Ah yes… which means that I dreamt this all up?  Which is what, in effect, some of us are being told… I kid you not.

(5)  So where did this come from?  Well, it’s what a good number of folks were told was the “private option”.  HSAs linked to HDIPs — boom.  Problem solved.

Of course, that doesn’t satisfy some really poorly done fire-first-questions-later blogging on this issue.   But it does raise some interesting questions as to who is peddling what and why.  To date, we have a least five different proposals for reform out there:

  • McAuliffe and Medicaid expansion, 80 proof, no chaser.
  • The Virginia Chamber of Commerce plan (HSAs and HDIPs, Medicaid audit, vague assurances on the rest)
  • The Virginia Senate plan (mimics the Pence plan in IA and the Lee plan in UT)
  • The “Healthy Virginia Works” plan (Medicaid “private option” that uses federal funds to subsidize a private insurance plan)
  • The Bearing Drift plan (tax-free HSAs linked to HDIPs, no Medicaid expansion)

Safe to say, if we’ve stumbled over the solution (or I was indeed sold an alternative that hasn’t come forward yet), by all means I’ll take credit for it.  Heck, tax havens?  Sign me up, baby!  That’s conservative solutions at work, right?  Conservative means to liberal ends — HSAs and HDIPs mean everyone jumps in the pool and no one gets left behind… heck, maybe we can start using HSAs as a means to chip away at wasteful Medicaid programs…

…but all that gets lost in the haze.

Let’s be clear — $7 billion is on the table.  Not everyone is on the side of truth and justice here… some folks want it to be in the hands of government, others want private insurers to get the lion’s share.  Other folks, in the cloak of conservatism, promote the very things they claim to oppose (i.e. the HHS Mandate) by choosing to do nothing at all.

Ask a lot of questions on this one, folks.  There’s a war on for you mind… something like that?  Worse, not everyone in this game are being honest actors.

Oh — and no Medicaid expansion.  No negotiation, no compromise, no question.   Just in case that wasn’t clear.

UPDATE x2:  Interestingly enough, Healthy Virginia Works (HVW) has clearly seen the conversation here.  Rather than correcting my understanding of the “private option” and politely informing the rest of us that the private option is really a public expansion?  They’ve been kind enough to promote this post on social media outlets.

…which means the “private option” really is just that.  HSAs + HDIPs.

There’s another thing to consider here — the coalition posted online is really just built around some pretty basic principles: ending the HHS Mandate, providing a “private option” to Medicaid, auditing the feds, etc.  Are they loosely defined?  Intentionally so, I believe… but designed to at least get a group of individuals together interested in some sort of reform.

What the final shape of reform looks like is probably yet to be determined.  But if support for reform means by extension that we’re all in favor of Obamacare expansion (ludicrous as that charge is), then the converse is true as well — opponents of HSAs and HDIPs are in favor of the abortion mandate, the contraception mandate, the status quo.

Of course, that’s an equally specious argument.  In the meantime, just be aware that there are several very powerful interests that are hostile voice against any sort of true free-market alternative to health care.  HSAs and HDIPs put money back into the wallets of consumers… and not into the hands of corporations or government.  To some, free market solutions are bad… depending on your motives (i.e. support for or a disinclination to oppose the HHS Mandate), and they’ll even claim to be conservative.

Until we have legislation, all we have are groups advocating for one thing or the other.  Quite frankly, I’m curious as to why more conservatives aren’t lining up for an HSA/HDIP solution.  I know the answer… but I’ll let them explain over the next few weeks.  Other solutions that have come forward:

  • Break up the large HMOs and incentivize HSAs through competition.
  • End hospital monopolies in Virginia and push health care to compete.
  • Include strict tort reform in Virginia.
  • Create risk pools for so-called uninsurables at a subsidized premium.
  • Zero federal funding commitments.

There’s a few other ideas that esrtwhile libertarian blogger Chris Green (who lives, eats, sleeps, and breathes insurance) has tossed out as ideas to further the HSA/HDIP solution, which now seems to be gaining a heck of a lot more ground than pearl-clutching minority would care to admit.

UPDATE x3:  The conversation on Twitter ensues!  A few Americans for Tax Reform (ATR) staffers/friends I count on to sort me out (and they do) have a novel idea:


In other words, block grant all of Medicaid and turn the entire program into HSAs and HDIPs — no additional federal funds needed.

The interesting thing here is that in concept, ATR doesn’t oppose the idea of using federal dollars to match individual savings… but not at the expense of expanding Medicaid by shoveling more tax dollars into the maw of government.

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