The Oregon Data and the Health Care Debate

The big news in health care today is the latest data from an ongoing study of Medicaid recipients in Oregon, which finds that while being on Medicaid improves people’s financial situation and boosts their mental well-being, in the interval studied the program seemed to have little or no statistically significant impact on their actual physical health. I’ll try to have more to say about this over the weekend  — for now, I recommend reading Megan McArdle and Jonathan Cohn for a sense of the debate — but since I’ve been writing about the Republican Party’s health policy problem this week I was struck by this line from Matt Yglesias, in a post mostly dismissing the significance of the new data:

… the Medicaid study hasn’t changed the political views of anyone I know and it shouldn’t change yours either. The political debate in America is about whether we should tax the rich to expand Medicaid or whether we should cancel Medicaid expansion in order to cut taxes on the rich. If you like the idea of taxing the rich to help the poor (I sure do), the study shows that Medicaid helps. If you don’t like the idea of taxing the rich to help the poor, the study gives you a talking point.

But what if we lived in a world in which the Republican Party had fully embraced the views of many right-of-center health policy writers (and some G.O.P. politicians, including the John McCain of 2008) and supported an alternative to Medicaid expansion, which would change the tax treatment of health insurance to free up money to create a universal tax credit or voucher designed to spur the purchase of catastrophic health insurance plans? What if the choice, in other words, weren’t between the current health care law and a repeal-plus-nothing G.O.P., but between the current health care law and the best conservative thinking on the issue?

Obviously the policy questions are vexing and complicated, and no single study is likely to dislodge people’s commitments no matter the state of the debate. But in that (hypothetical) world, the Oregon study’s evidence that Medicaid helps people financially but doesn’t do that much for health outcomes seems like it makes a much stronger case for the (hypothetical) Republican health care alternative than for the current Medicaid-driven, comprehensive-coverage-seeking Democratic approach. After all, if insurance is mostly beneficial because it shields low-income people “from medically induced financial catastrophe,” then why not make that the policy goal, rather than trying to expand Medicaid’s deeply flawed form of single-payer from the bottom up … ?

The fact that this world is hypothetical, and the real political landscape is somewhat closer to what Yglesias describes, means that it’s incumbent on conservative policy writers to redouble their efforts to push actual Republican politicians to embrace their ideas. But it’s also incumbent on liberals not to let the G.O.P.’s current (and, yes, perhaps long-enduring) policy problem become an excuse for intellectual laziness. The data from Oregon need not change your politics, but that doesn’t justify the claim that it lacks any policy implications at all.

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