Don’t Count Health Care Chickens Before They’ve Hatched

I raise chickens. No, I don’t own a farm, but for the four hens that live in my backyard, it might as well be one. And as you would expect with chickens, my wife and I receive a steady stream of edible eggs that will never hatch. Not having a rooster will do that.

I was reminded of our unhatched eggs after reading a commentary last month by Columbia Daily Tribune editor Henry J. Waters III. While I agree with Mr. Waters from time to time, I can’t help but disagree with his assessment that “what’s next” after the American Health Care Act is “single-payer.” Although it remains a persistent threat to good public policy, single-payer is a counted chicken from an unhatched egg—and an egg that may, in fact, never produce a bird.

I say this for several reasons.

First, the laws of economics are as true in health care policy as anyplace else. Top-down cost controls in single-payer systems have significant tradeoffs that become obvious when looking at the Medicaid program alone. Rather than introduce market mechanisms to control costs, Medicaid programs across the country more often pay doctors less to provide the same services, or simply cut services directly. That means fewer doctors and worse access for patients. Many taxpayers recognize this and believe this sorry dynamic shouldn’t be applied to the public writ large. We need markets; single-payer systems don’t deliver them.

Second, it isn’t obvious to me that the window for Obamacare reform has closed. President Donald Trump and Speaker Paul Ryan have publicly declared their intent to move on to other legislative priorities like tax reform, but in the weeks since the AHCA’s withdrawal, it’s not clear that the AHCA itself is dead, or that reform will not come through another legislative vehicle. Keep in mind that Obamacare passed over a year after negotiations on the bill began in 2009; there is plenty of reason to believe that despite the posturing of legislative leadership, another attempt at reform is forthcoming.

Third, and perhaps most importantly, measures continue to flow into the present health care policy landscape, even as federal efforts remain in limbo. State-based legislative changes that would: do away with hospitals’ certificate of need monopolies; empower patient–doctor relationships through direct primary care arrangements; open new avenues to care through licensing reforms; and introduce market mechanisms into existing state programs remain active issues in the states, and issues that Missouri legislators have often been on the forefront of implementing. And that’s just the short list of currently debated reforms.

Surely federal health care efforts are an important part of the reform puzzle, but it presumes too much to think that federal officials are the only ones calling the shots in health care policy. For many years now, states have had a primary role in these decisions, from demurring on Obamacare exchanges to rejecting the law’s unsustainable Medicaid expansion.

This isn’t to say that the single-payer health care system Mr. Waters envisions is a political impossibility; market reformers need to take such efforts seriously. But the odds of it becoming law anytime soon are sufficiently unknowable that Mr. Waters is better served by not counting that chicken, at least not yet.

The mistakes of heavy government intervention in our health care over the last few decades are now coming home to roost. Rather than continue those mistakes, we should be reducing the government presence in our health care decisions, not increasing it. Hatching an even bigger government intervention in American health care seems more likely to produce a rotten egg than a productive hen.

Different Paths to Course Access

Course Access is a hot topic in Missouri right now. Both the governor and legislature have made it a priority, and, at least so far, it is enjoying broad, bipartisan support. Now it is a matter of getting it done. As it turns out, there is no one exact way to “do” course access. There are, in fact, several possible paths.

One path, outlined in the governor’s budget, simply funds a course access program. Missouri already has the architecture with its Missouri Virtual Instruction Program (MOVIP), but there simply aren’t funds for students to take advantage of it. Governor Greitens proposed $2 million in funding so that students could access those courses.

Legislation now making its way through the legislature is taking a second path. House Bill 138 and Senate Bills 327, 238, and 360 create a course access program funded by redirecting existing funds that the state sends to school districts. If students want to take a course access program course, the fraction of funding that would have funded the class in their school of residence is used to pay for it. What’s great about these plans is that, as their fiscal notes attest, they cost the state zero additional dollars. They simply redirect existing spending.

A third is outlined in this great piece by AEI’s Rick Hess and the Manhattan Institute’s Max Eden. The broader article is about how states can best use the flexibility inherent in the Every Student Succeeds Act (the 2015 update to No Child Left Behind), but this paragraph stands out:

State education leaders would do well to employ ESSA’s direct student-services provision, which allows states to set aside a portion of federal Title I funds in order to support districts that are expanding instructional choice (in addition to school choice) for students. This means expanding choices for students without requiring that they opt to change schools, as with “course access” programs. Such initiatives, pioneered in Louisiana and Utah, use state funds to provide students the opportunity to access a range of online courses that their school might not offer — and to pursue them at their own pace. Under ESSA, states can use up to 3 percent of federal Title I funds to deliver online-course options that give rural students access to subjects that their schools don’t offer, to give all students access to Advanced Placement, and to give high schools the ability to deliver robust career and technical training.

According to this table, Missouri school districts get a little bit north of $240 million per year in Title I dollars. Three percent of that would be $7.2 million. This could fund thousands of course enrollments.

Taken together, Missouri could draw from several wells of funding to create a robust course access program that ensures that every student in the state has access to the coursework that best fits their needs.

For an overview of course access and information on how it has been implemented in other states, see this essay that Brittany Wagner and I co-wrote last year.

Calling the Previous Question

Last week I published a piece in Forbes about my concerns about the progress of this year’s legislative session. I wrote about the high expectations taxpayers had and the mandate they sent for legislative reform—including labor reform, tax reform, ethics reform, education reform, and many others. Some legislators, particularly in the Senate, have explained the legislative lethargy we’ve seen as the result of Senate tradition, where filibusters are generally allowed to go on for as long as the filibusterer chooses. But within that tradition, of course, is a way to sidestep the filibuster: calling the previous question.

A previous question motion, or “PQ,” allows for a vote on a bill or amendment if a majority of the chamber chooses, even if a filibuster is ongoing. The details of the motion are laid out in Rule 84 of the Rules of the Senate, which describes the PQ as follows: 

The previous question shall be in this form: “Shall the main question be now put?”. It shall only be admitted on written demand of five senators, and sustained by a vote of a majority of the senators elected, and in effect shall be put without debate, and bring the senate to direct vote upon a motion to commit, if such motion shall have been made; and if this motion does not prevail, then upon amendments, and then upon the main question. On demand for the previous question, a call of the senate shall be in order, but after a majority of the senators elected have sustained such a motion, no call shall be in order prior to the decision on the main question.

Translation? Five senators can initiate the PQ, and a majority of Senators can end a filibuster. Why Senators would hesitate to call a PQ isn’t necessarily captured in the rules, of course, and as we’ve seen in previous sessions, spurned Senators can grind the chamber to a halt by opposing motions that require unanimous consent or filibustering other legislation. This eats up time for other legislative priorities, which is essentially the point and central to the threat.

But the PQ shouldn’t be considered in a vacuum or treated as if it were dictated by immutable laws of Senatorial physics. Whereas the filibuster and the PQ are well within the realm of Senate tradition, so too are rules changes that would head off the sort of obstruction that has dissuaded previous sessions from appropriately using the PQ motion; after all, if rule changes were not part of Senatorial tradition, then there wouldn’t be rules explicitly allowing for changing Senate rules. “Tradition,” as it turns out, is both a shield and a sword, and legislators obstructing reform need to realize the “tradition” argument cuts the other way as well.

The real question, then, isn’t whether the PQ and related rule changes are consistent with Senate tradition—they are—but whether Senate leadership has the courage to break the reform logjam. Time will tell, but time is running out.

Mayor James Gets It Wrong

Kansas City Mayor James penned a guest commentary for The Kansas City Star on Wednesday. Unfortunately, it is riddled with errors and half-truths.

The Mayor begins with an assessment of the problem stemming from years of previous city councils failing to spend properly on infrastructure. Then he characterizes his solution thusly:

Over 20 years at approximately $40 million per year, this plan asks everyone in the city to invest through an annual property tax increase on both residential and commercial properties.

If the bond passes on April 4, the city says it will issue 20 different 20-year bonds. The last one will be issued in 2036 and will be paid off in 2055. The GO Bonds commit taxpayers to 40 years of debt, not 20. He also speaks to the cost to taxpayers:

The average residential property owner, with a $140,000 house and a $15,000 car, would see an increase in their property taxes each year for 20 years. That property would see an average of $8 added to their property tax each year. In year 20 that property owner would pay an average of $160 more than they pay today.

Both the Show-Me Institute and the Star have explained that this claim is inaccurate. The City Manager has stated that the cost is closer to $100 a year. The true cost of this bond to the owner of a $140,000 house and $15,000 car would be over $4,100.

The Mayor also refers to a report card that will account for projects and costs, but voters should be wary. If the GO Bond campaign—including this piece by the Mayor—is any indication, the report cards will be designed to present city spending in the best possible light. Remember, this is the same Mayor who refused to have the City’s Water Department audited.

As the Mayor points out, Kansas City is in this situation because important infrastructure and maintenance spending has been neglected. City leaders always find something else they want to fund. Without any significant changes to how City Hall operates—and this measure contains none—why should voters risk increasing their taxes just to see the exact same neglect repeated?

Can Legislation Make You Forget to Buy Insurance?

My colleague Michael McShane recently wrote a legislative “half-time report” on education reform in Missouri. While some bills haven’t moved as quickly or as far as he would like, education reform appears to be in much better shape than transportation reform. SB 185, a promising bill that would streamline regulations for transportation network companies (TNCs) like Uber and Lyft, has hit a snag. After moving uncontroversially through a senate committee, the bill has been filibustered.

SB 185 would create a statewide regulatory framework for TNCs, making it possible for them to operate across different jurisdictions that may have conflicting local regulations (or no TNC regulations at all). The law embodies free-market principles and could create jobs, improve mobility, and increase personal freedom. Show-Me Institute analysts, myself included, have testified in favor of SB 185 and similar legislation (e.g. HB 130) for years. So why is the bill hung up?

The Missouri Times reports that a senator:

opposes the legislation because he fears it will lead to fewer people, namely those who sign up to become drivers for TNCs like Uber, Lyft or Sidecar, to forgo paying for insurance. If a person signs up to become a driver, he says, and a TNC promises to cover his or her insurance when they’re driving for the company, drivers could forget their insurance only applies when they are on the clock when it comes time to renew their personal insurance.

In short, the bill seems to have been held up over concerns that TNC drivers, who use their own personal automobiles while on the clock, will simply forget they still need to purchase an individual auto policy.

If this concern is indeed motivating the filibuster, it seems misguided for two reasons. First, most TNC drivers work part time, and therefore likely own automobiles for personal use (57% of Uber drivers work less than 15 hours/week, and 86% work less than 35 hours/week.) Since these drivers own cars primarily to use themselves, it seems unlikely they’ll just forget to buy insurance once they start driving a few hours a day for a TNC. Second, to register your vehicle in Missouri, you need proof of insurance! It’s hard to understand why Missourians would forget to purchase (state-mandated) insurance just because they receive commercial coverage when driving for a TNC. It’s even harder to see how that fear would outweigh the potential benefits of sensible TNC regulations.

Proponents of SB 185 are still optimistic, but the future of free-market transportation reform is unclear. I remain hopeful that the policies embodied by SB 185 will eventually enable drivers to earn a living, help riders save money, and make it easier for all Missourians to get around. 

Debating GO Bond Policy

We were disappointed to learn that Mayor Sly James has turned down an offer to debate the Go bonds issue with us.  Nick Haines had extended the invitation for his KCPT program Week in Review. This is an important issue worthy of public debate.

Kansas City voters are being asked to consider borrowing $800 million dollars by issuing bonds backed by an increase in property taxes that will last 40 years. The campaign in favor of the proposal has raised hundreds of thousands of dollars from some of the biggest corporations and special interests in Kansas City. The Mayor and members of the City Council have spoken at town hall meetings and on radio and television. And yet serious questions remain.

Show-Me Institute analysts have been skeptical of the city’s GO bond claims for some time. We were the first to point out that the city was proposing 40 years of debt (not 20), the first to expose the city’s misleading tax assumptions, and the first to point out that the city will be able to divert general revenue funds to other unrelated matters.

A policy debate is nothing to fear. For example, on March 20, Councilman Scott Wagner and I discussed the GO bond at the Indian Mound Neighborhood Association. The talk was professional, and I am confident that the room full of attendees were pleased to have both sides represented.

The public only benefits from a government that is transparent and accessible. We reiterate our invitation to the Mayor. If his schedule doesn’t permit the particular time and place offered by KCPT, how about another time and place?  With $800 million at stake, the decision voters make on the GO bond should be an informed one. We can think of no better way to educate Kansas City residents than a debate, and we would welcome an opportunity to join with the Mayor to present two different perspectives on this important issue. 

Coming Together for Free Speech

In an earlier post I argued that Dr. Charles Murray’s assault at Middlebury College might mark a turning point in the battle for free speech on college campus. As if on cue, two leading American intellectuals published an open letter supporting free speech and encouraging other academics to sign it.

Robert George and Cornel West provide a great example of the kinds of open intellectual exchange that should happen on college campuses. For over a decade the two have team-taught a course at Princeton that examines important works of political philosophy and offers students a chance to see these works from George’s right-leaning and West’s left-leaning perspective.  (If you want some indication of how this might look, check out this video of George and West talking about the purpose of a liberal education at AEI last fall.)

The letter, now signed by hundreds of scholars, is worth reading in full, but I do want to highlight two paragraphs that I found especially compelling:

None of us is infallible. Whether you are a person of the left, the right, or the center, there are reasonable people of goodwill who do not share your fundamental convictions. This does not mean that all opinions are equally valid or that all speakers are equally worth listening to. It certainly does not mean that there is no truth to be discovered. Nor does it mean that you are necessarily wrong. But they are not necessarily wrong either. So someone who has not fallen into the idolatry of worshiping his or her own opinions and loving them above truth itself will want to listen to people who see things differently in order to learn what considerations—evidence, reasons, arguments—led them to a place different from where one happens, at least for now, to find oneself.

All of us should be willing—even eager—to engage with anyone who is prepared to do business in the currency of truth-seeking discourse by offering reasons, marshaling evidence, and making arguments. The more important the subject under discussion, the more willing we should be to listen and engage—especially if the person with whom we are in conversation will challenge our deeply held—even our most cherished and identity-forming—beliefs.

A good lesson for all of us.

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