The Trump administration’s former Health and Human Services secretary could have changed his surname to Kinsley this week. Kinsley refers to columnist Michael, creator of the “Kinsley gaffe,” defined as “When a politician tells the truth—some obvious truth he isn’t supposed to say.”
Price did just that on Tuesday, when in a speech he said provisions in the tax legislation effectively eliminating the individual mandate penalty “will actually harm the pool in the exchange market, because you’ll have individuals who are younger and healthier not participating in that market, and consequently, that drives up the cost for other folks within that market.”
To coin a phrase, “Well, duh.” Some of us came to that exact same conclusion months ago.
But the remarks prompted the typical Washington food fight. Democrats had a field day, claiming that Republicans “sabotaged” Obamacare, and that Price took a contrary position last year, when he said repealing the mandate would lower health costs.
Within 24 hours, Price attempted to “clarify” his original comments, in a statement saying that “repealing the individual mandate was exactly the right thing to do. Forcing Americans to buy something they don’t want undermines individual liberty as well as free markets.”
Ironically enough given the controversy, it’s relatively easy to reconcile both Price’s original Tuesday comments and his Wednesday statement, when taking his earlier comments in their full context.
On Tuesday, Price said repealing the individual mandate “may help, but it still is nibbling at the side.” Price is exactly right. Repealing the individual mandate, while keeping the rest of Obamacare in place, only undoes a portion of the law—and a relatively small portion at that.
Particularly when viewed from a freedom perspective, repealing the mandate seems quite insufficient. Republicans prevented some Americans from incurring tax penalties for buying a product they may not want or could not afford. But what does repealing the mandate do to give Americans the affirmative choice to buy a product they can afford? Absolutely nothing
Admittedly, the administration has put forward some helpful proposals to give consumers more choices. But any fix done solely through regulations by definition carries major limitations—most notably the fact that any future presidential administration could, and any Democratic administration likely will, attempt to undermine or reverse the executive actions.
Price’s Tuesday comments hit at the point I originally made last fall, when Congress considered the tax bill: Repealing the individual mandate while leaving the regulations in place will raise premiums. The only question is how much. Healthy individuals will have a greater reason to avoid costly Obamacare coverage, making the remaining population sicker and costlier. This dynamic also motivated Congress to consider a “stability” (i.e., bailout) bill earlier this year, which sought to blunt the effects of premium increases by throwing taxpayer money at the problem.
But as I have previously written, “It’s the regulations, stupid!” Throwing money at the problem won’t fix the underlying problem. Only fixing the problem will. Rather than criticizing Price for his candid and impolitic comments, Republicans would do better to go back and work to pass legislation repealing the Obamacare regulations—to give people the freedom to buy coverage they want, rather than just eliminating penalties for people who refuse to buy coverage they don’t need or can’t afford.