The nation may still be recovering from the 2018 mid-term elections, but the policy world has moved on to 2020. Prospective candidates are already forming their policy positions for the upcoming race.
I have been involved in national health care politics since 1992. With the understanding that all outlooks are uncertain, here is how I see the landscape shaping up.
Democrats are pleased at how health care worked for them in 2018. To a great extent, they won control of the House because of health care. But 2020 will be a different story. Although the Democratic message in 2018 was opposition to Republican repeal efforts, the party will want and need to put forward a more positive frame in 2020.
At the national level, the key issue for the Democrats is what to make of a single-payer health system. About 85% of Democrats support single-payer health care; among activists, support is even higher. However, the term “single payer” is not well defined. Candidates for the House or Senate can be vague about what they mean by single payer, but a Presidential candidate cannot. Thus, presidential candidates will have to make some difficult choices. Consider 3 examples:
Does single payer allow private insurance? For some people, single payer translates into a single insurer, as in Canada or France. It is easier to negotiate lower prices for pharmaceuticals and to reduce administrative costs when there is only one payer. But single insurer is not what people are used to. Even in Medicare, more than one-third of beneficiaries currently choose to enroll in a private plan. Does single payer mean “traditional Medicare for all,” or can it instead be “Medicare Advantage for all”?
Should high-priced clinicians and hospitals and health systems get less revenue? Some hospitals are paid twice what other hospitals are paid for the same service. On average, specialists earn 50% more than generalists, and the best reimbursed specialists earn even more. It is natural to want to reduce these reimbursement gaps. But should high prices be lowered? The easiest political answer is leave currently highly reimbursed providers alone and raise reimbursement for primary care doctors and community hospitals. However, leaving high prices in place dramatically lowers the savings from single payer and necessitates larger revenue increases. Which is more important: not disrupting key providers or saving money?
What is the transition path? Perhaps the biggest issue for a proposal on a single payer system is managing the transition from the current system. Absent a massive electoral victory, Democrats will not have the votes in Congress to enact a wholesale reform of health care right away. Thus, transitions become key. Is it worth shoring up the Affordable Care Act, or is that just a distraction? What is the sequence of changes to be made? Related to the issue of transition paths is the placement of health care on the agenda. Is health care the first issue that the candidate proposes to address, or does it take a back seat to education, immigration, climate change, or some other issue?
In making these trade-offs, a key issue that candidates will need to grapple with is that voters have a much narrower priority for health care than do activists. Activists care about the system as a whole; voters care about reducing the amount they spend on health care premiums and out-of-pocket costs. The primary complaints about both the Affordable Care Act and the Republican alternative were that they did not do enough to lower costs.
If a candidate wants to focus on costs, there are several options. High pharmaceutical costs are an obvious area, for which the Trump administration has created a clear opening. Administrative cost reforms are also ripe, as I laid out in recent Congressional testimony.
These are the central issues facing Democratic hopefuls. Is single payer a long-term goal or a place one reaches over time? If the former, how does one get it through a divided Congress? If the latter, does one lead with cost or with coverage?
The Republican party has a different problem: it needs to develop a positive case for supporting it on health care. The most striking observation about the Republicans’ repeal and replace fiasco is how little the party had thought about the “replace” part. Six years of promising a better health plan led to no solutions that could garner popular support. In a way, this isn’t surprising. As Republican presidential nominees, neither John McCain in 2008 nor Mitt Romney in 2012 had popular health care proposals.
President Trump and Republicans running for Congress are unlikely to come up with something big and positive prior to the 2020 election. Adding to this misfortune is the fact that the Democratic House will surely propose legislation that will force Republicans into awkward votes against popular health care provisions.
The obvious strategy for Republicans is thus to oppose the likely Democratic position and hope that they can convince voters that doing nothing is better than the Democratic option. However, there are clear signs that doing nothing seems to be losing its resonance: in the 2018 midterms, voters in Idaho, Nebraska, and Utah all defied their conservative politicians and voted to expand Medicaid.
President Trump has an option that could work for him, but it might sacrifice his party in the process. Trump’s proposals for pharmaceutical pricing are far closer to recent Democratic proposals than traditional Republican ideas. Indeed, 55 Conservative organizations recently came out in opposition to his ideas. If the President wants to run for reelection as a doer, he could strike a deal with Democrats and pass a pharmaceutical bill largely with minority votes. This would enhance his own chances for reelection but likely cause his party to suffer in Congress. Is the trade-off worth it for him?
The importance of health care as a voting issue in 2018 surprised many pundits. In casting their ballots, voters often put personality aside and focused on issues. I would not be surprised to see that scenario repeat in 2020. Health care could once again be the sleeper issue of a national election.
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David Cutler, PhD David Cutler, PhD, is the Otto Eckstein Professor of Applied Economics in the Department of Economics and holds secondary appointments at the Kennedy School of Government and the School of Public Health at Harvard University...