Even as Democrats inveigh against President Trump for his alleged norm-shattering and contempt for the rule of law, their health care plans show a growing embrace of authoritarianism. For instance, Rep. Adam Schiff (D-CA) recently dubbed the president’s July 25 call with Ukrainian President Volodymyr Zelensky “a classic mafia-like shakedown.” He knows of which he speaks, because the Democratic Party agenda on health care now includes threats to destroy any entities failing to comply with government-dictated price controls.
The latest evidence comes from Colorado, where several government agencies recently submitted a draft report regarding the creation of a “state option” for health insurance. The plan would not create a state-run health insurer; instead, it would see agencies dragooning private sector firms to comply with government diktats.
The plan would “require insurance carriers that offer plans in a major market,” whether individual, small group, or large group, “to offer the state option as well.” In these state-mandated plans that insurers must offer, carriers would have to abide by stricter controls on their administrative costs — in the form of medical loss ratio requirements — than those dictated by Obamacare.
For medical providers, the Colorado plan would use “payment benchmarks” to cap reimbursement amounts for doctors and hospitals. And if hospitals decline to accept these government-imposed price controls, the report ominously says that “the state may implement measures to ensure health systems participate.”
In comments to reporters, Colorado officials made clear their intent to coerce providers into this price-controlled system. Insurance Commissioner Michael Conway admitted that “[i]f our hospital systems don’t participate, this won’t work … [w]e can’t allow that to happen.” The head of Colorado’s Department of Health Care Policy and Financing, Kim Bimestefer, said that “if we feel that the hospitals are not going to participate, we will require their participation.”
State officials did not elaborate on the mechanisms they would use to compel participation in the state option. But they could attempt to require hospitals and insurers to participate in the new plan to maintain their license to operate in Colorado — a likely unconstitutional condition of licensure.
In threatening this level of coercion — agree to price controls, or we’ll shut down your business — Colorado Gov. Jared Polis imitated his fellow Democrat, House Speaker Nancy Pelosi. Pelosi’s proposed drug pricing bill, up for a vote in the House as soon as next month, would impose excise taxes of up to 95% of a drug’s sale price if companies refuse to “negotiate” with the federal government.
In its analysis of Pelosi’s legislation, the Congressional Budget Office (CBO) noted that, because drug makers could not deduct the 95% excise tax for income tax purposes, “the combination of income taxes and excise taxes on the sales could cause the drug manufacturer to lose money if the drug was sold in the United States.” Perhaps unsurprisingly, CBO concluded that the excise tax would not generate “any significant increase in revenues,” as “manufacturers would either participate in the negotiating process” — because they have no effective alternative — “or pull a particular drug out of the U.S. market entirely.”
CBO also noted, in a classic bit of understatement, that Pelosi’s bill “could result in litigation,” for threatening losses on any company that dares defy the government’s offer of “negotiation.” But the Left seems uninterested in abiding by limits on government power — or the consistency of its own arguments. As I noted this spring, other proposed legislation in Congress would abolish the private health care market. Less than one decade after forcing all Americans to buy a product for the first time ever, in the form of Obamacare’s insurance mandate, liberals now want to prohibit all Americans from purchasing care directly from their doctors.
These recent proposals continue a virulent strain of authoritarianism that has permeated progressivism’s entire history. Franklin Roosevelt threatened to invoke emergency powers during his first inaugural address, and Rahm Emanuel infamously said during the Great Recession that “you never want a serious crisis to go to waste.” Make no mistake: The health care system needs patient-centered reform. But the true crisis comes from the progressives who would utilize blunt government force to seize control of one-fifth of the nation’s economy.
Mr. Jacobs is Founder and CEO of Juniper Research Group, and author of the book The Case Against Single Payer. He is on Twitter: @chrisjacobsHC.