Power, Negotiation, and the Affordable Care Act: A Look Toward the Future


I didn’t expect to be writing about the King v. Burwell decision today. I didn’t expect the Supreme Court to publish its decision until today. But we got it last Wednesday.

I’m not surprised by the decision. As I wrote after the oral argument in March,

“My prediction is that we will either have a 6-3 vote to uphold the IRS interpretation, or we will have a 5-4 decision against the government. I think the Chief Justice will want to be in the majority on this case, so he can at least assign the opinion, and quite likely keep it for himself. That way, he can shape the future of the Affordable Care Act, as he did in National Federation of Independent Business v. Sebelius.”

The first of my scenarios came true: Chief Justice Roberts was in the majority and did keep the opinion for himself. He admitted that the ACA “contains more than a few examples of inartful drafting,” but decided that undoing the subsidies in states using the federal exchange would negate Congress’s overall intent. Congress intended to prevent “death spirals” in the insurance market, and prohibiting subsidies would vastly increase the likelihood of such destabilization in the insurance market.

Once again, Chief Justice Roberts kept the Affordable Care Act from collapsing, thus supporting a poorly written statute the Democrats crammed down the nation’s throat in 2010.

So, where do we go from here? As I wrote just a few weeks ago, the ACA needs fixing for a variety of reasons. While I would prefer to see Congress start from scratch with a market-based approach to healthcare—an approach not based on employer subsidies—the likelihood is that we cannot get there from here. And probably should not.

I recently attended a mediation training program that talked about negotiation power. The presenter made several points about power:

  • Power is relative—it depends on the specific parties to the negotiation and their circumstances.
  • Power is not static—it changes as time passes and the parties change.
  • And the exercise of power has both benefits and costs. The benefit, of course, is that the parties that exercise their power are more likely to get what they want. But at the same time, each exercise of power changes the dynamics of the situation and often increases the resistance of the other party, which can make future concessions more difficult.

This is exactly what has happened in the Obamacare debate. Because the act passed solely by exercise of Democratic power, Republicans became entrenched in pursuing its defeat. They had not been a part of the negotiations. They had been steamrolled, and they didn’t—and still don’t—like it. The temptation will be for Republicans to run the steamroller back over the Democrats, if they get the opportunity.

But what we need is a candid, bipartisan review of the problems with Obamacare, starting with

  • The tax on medical devices
  • The panoply of mandated benefits that make little or no sense (e.g., requiring nuns to cover birth control) and increase costs
  • The fiction of charging older people no more than three times what younger people are charged when older citizens need far more healthcare than the young
  • The Cadillac tax on employers that provide strong healthcare plans
  • The definition of “full-time employee” that employers must cover under the law as someone who works 30 hours per week

It has been said that healthcare reform is based on a “three-legged stool” approach of (1) requiring insurers to treat everyone the same regardless of preexisting conditions, (2) mandating that everyone buy insurance, and (3) subsidizing insurance to make it affordable. Even if we keep these legs (and the individual mandate remains highly unpopular), how can we reduce the onerous and costly impacts of the reforms?

  • Fewer mandated benefits.
  • Allowing people to choose only catastrophic plans.
  • Lower subsidies, which would be possible because the plans would be cheaper.
  • Other options include allowing state experimentation and the development of regional healthcare plans.

Even President Obama acknowledges that changes to the ACA are necessary. Some minor changes might get passed in the next two years, but Republicans have until early 2017 to coalesce around a proposal for major reform of our healthcare system. They should make their decisions by reconciling what is in the long-term interest of our nation (in terms of affordability and equity), what is possible to pass after the 2016 elections, and what will be acceptable to the citizenry—which may be three different things.

What parts of the Affordable Care Act do you think most need revising?

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2 Comments

Filed under Law, Leadership, Mediation, Politics

2 responses to “Power, Negotiation, and the Affordable Care Act: A Look Toward the Future

  1. Sara, I think you need to run for office! Maybe then we could get this mess managed!

    • I had a law professor who said he wanted all the Supreme Court justices to be his clones. Well, I’d like all the legislators to be mine, in addition to the justices. Unfortunately, I don’t think that’s going to happen.
      Thanks for the comment,
      Sara

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