The accepted post-election narrative in NY-26 is that the Republicans overreached on Ryan’s Medicare reform plan and the voters socked it to them. Make no mistake, this is the Democrats’ narrative that the media was anxious to adopt. However, there appear to be some inconsistencies with this story.

First, why did the newly-elected Democrat Kathy Hochul denounce support for Obama’s health law? If this was such a victory for the Democrats’ protection of Medicare and their new health law, why would the Democratic candidate not only steer clear of it but even voice her disapproval?

Second, the Tea Party candidate was a wealthy, liberal Democrat that for all intents and purposes seemed to be an impostor trying to co-opt and sully the Tea Party brand. This might be a successful strategy for Democrats going into 2012 but it doesn’t say much about the Ryan Medicare plan.

Third, a steady rule in politics is once you own something, you better defend it. This holds true even more so if it is a bold reform plan – taxes, immigration, entitlements, for example. George Bush got clobbered for his attempts to create private accounts for Social Security when he was unable to rally Republican support. This occurred despite the fact that it was solidly a Republican idea. His failure to rally, and Republicans’ failure to engage in the debate, left the party open to attack on the issue without a real defense of their position. Similarly, John McCain did not invest enough time and energy learning his health care plan in 2008 and got beat up at every turn because of it. This was not because it was a bad plan. In fact, it was a very good one. But it took explanation and impassioned defense. The Republican candidate needed to more forcefully own and defend the Medicare reform plan in NY 26, not present a mealy-mouthed defense for what her party is trying to do.

This is the future Republicans face in 2012 if they do not choose to embrace their own ideas. They don’t have to applaud every detail and say it’s perfect but right now the Ryan plan is the only game in town. And it’s pretty good compared to what the other side has, which basically lets Medicare become either insolvent or vastly rations care.

Democrats have 756 days without presenting a single budget proposal. Moreover, to the extent the Democrats have a plan to save Medicare, it can be found in “Obamacare” and its rationing board made up of 15 bureaucrats (IPAB). It is the ultimate fatal conceit to think that 15 health care professionals are going to be able to effectively and humanely make health care decisions for all of America’s seniors. But this is the current law! So why aren’t Republicans out there making sure America knows that until another alternative plan is presented, this treatment denial board, IPAB, is set to make their health care decisions for them in a few short years? We can be sure America has no clue of this board’s existence right now, nor that this is the new “status quo.”

So to recap, yes, yesterday’s election had a lot to do with Medicare and its need for reform. But the lesson is not that Republicans need to run from Paul Ryan. Rather, they need to put their running shoes on and JOIN Ryan as he defends his plan to save Medicare. Republicans will abandon him at their peril. Or to quote Ben Franklin, “We must all hang together, or assuredly we shall all hang separately.”

The Medicare Trustees report was released last Friday and it wasn’t good news for the program’s future. It showed Medicare – already running on IOUs from the Treasury Department, which increases the deficit daily – will be insolvent 5 years earlier than expected (2024 rather than 2029). This is the second sharpest annual decline in Medicare’s solvency ever. So much for the idea that Medicare isn’t in trouble (a major talking point of opponents of the Ryan plan) or that Obama’s health law is somehow going to place it on a sustainable path. The program’s cash flow deficit of $32 billion is the worst its ever been both in terms of absolute dollars and percentage of taxable payroll. Simply put, Medicare is in serious trouble.

Now this is nothing new but it is important for Americans following the entitlement discussion in Washington to realize the reality of the program’s future under current law.

Another point worth noting is the Trustees’ affirmation of their finding last year that under the new Obama health law millions of Americans will not be able to keep their current plan. Yes, Mr. President, this means your promise heard over and over during the health care debate has once again been proven egregiously inaccurate. For Obama supporters, this may be difficult to hear but stick with me because it’s true.

The Trustees report discusses the new law’s impact on Medicare Advantage plans. Prior to the Obama health law, employers received a tax credit for providing retiree drug plans. Thanks to the law, however, employers will face a major tax increase if they maintain coverage and will overwhelmingly make the rational decision to drop coverage once the provision kicks in. The Trustees report projects the 6.8 million enrollees in these drug plans will drop to 800,000 by 2016. I’ll do the math for you – that’s a 90% drop in coverage!

Alas, the political consultants realize the importance of the senior voting bloc and have acted to blunt the impact until after the 2012 election. The Administration has granted waivers to some employers offering these plans and has increased payments to insurers offering Medicare Advantage plans to delay projected rate increases. Voila, seniors won’t realize the consequences of the Obama health law until after the president is safely in office for another four years. Of course, this means after the election when rate increases do kick in and employers do face this tax increase, the cliff will be an even steeper one for seniors to fall from. 

At that point Mr. Obama can confidently turn over the cost-control duties to IPAB – Independent Payment Advisory Board – the rationing board of 15 unelected bureaucrats created in last year’s health care overhaul. (Keep in mind this is the Democrats’ alternative to the Ryan plan. This board will make all the hard decisions about whose care to cut and which procedures to deny without ever having to take a politically sensitive vote or seek public approval. And if they screw up, don’t call your attorney just yet because they have been granted legal immunity from your claims. So unlike an insurance company that denies care, you not only cannot change providers, you also have no legal recourse against their errors.)

Generally ignored by the mainstream media, the Trustees yet again show the Obama health law to be disastrous for seniors and the future of Medicare. It also backs up what Cong. Ryan has been saying for some time – Medicare is on an unsustainable path and it’s time to get serious about how to fix it.

The first round of Circuit Court hearings on the Obama health law took place earlier today in Richmond, Virginia’s Fourth Circuit. Two cases were heard by the three judge panel (Liberty University appealing a ruling for the government and the Justice Department appealing a ruling for the State of Virginia). It’s worth noting that while the 4th Circuit is composed of 14 judges – 7 appointed by Democratic presidents and 7 appointed by Republican presidents – the 3-judge panel for today’s oral arguments were all Democratic appointees (2 were appointed by President Obama, the major beneficiary of this law being upheld). That being the case, it is widely figured that it was over before it began.

After listening to both sides arguments (as I did), a neutral observer could certainly hear the difference in the panel’s tone and questions toward the two counsels. As some individuals in the audience have described, the audio sounds more like the judges were looking to the government-appellee to help write their opinions while looking to attack the plantiff-appellant at every turn.

While the basics of the case are quite clear – the Commerce Clause requires at least some form of activity, even if the act has an insignificant effect on interstate commerce – never discount lawyers’ ability to play verbal gymnastics with a relatively simple term (e.g., remember Bill Clinton’s famous statement questioning the definition of “is”?) Here’s one example from today:

During appellant’s argument (Liberty), the panel focused on the question of what qualifies as an activity. They used as an example someone receiving a gift (let’s say it’s marijuana) from their neighbor. The neighbor, now in possession of marijuana, is now subject to Congressional regulation under the Controlled Substances Act (CSA), which stems from the Commerce Clause power. The neighbor did nothing to seek out, buy or acquire this gift but they are still subject to regulation.

So how is this different than those who do not seek out health insurance? I mean, Congress has the right to regulate marijuana just as much as the health care market. If your neighbor gives you marijuana and you accept it, you become subject to the CSA. The act is one of accepting the gift. Same as if someone offered to pay for your health insurance. If you accepted the gift, you would now be subject to Congressional regulation as it pertains to your health insurance.

Clearly, the difference with the individual mandate is that no neighbor has come over to give you anything. You are just sitting in your house all alone when the government knocks on your door and mandates that you buy a product. It’s reasoning? Because you chose not to accept the gift from your neighbor (whether it be marijuana or health insurance), you made an economic decision and consequently participated in economic activity. Voila, you are now involved in commercial decisions even when you’re sitting at home not buying anything. Don’t tell me this passes the laugh test.

The second point worth noting from today’s argument pertains to the necessary and proper clause. The government asserts that since:

A) Congress has the authority under the Commerce Clause to regulate the insurance market by prohibiting lifetime limits or denying consumers with pre-existing conditions, and

B) To make these reforms work, everybody must participate in the system

then,

C) They can exercise powers that would otherwise not be constitutional – force people to buy a product from a private company.

To paraphrase the government’s lawyer, “the Necessary and Proper clause allows Congress to fill in the gaps of a comprehensive scheme.” Essentially, the Justice Department has yet another quite expansive claim – that the Necessary and Proper clause is an additional power unto itself that can expand the other powers. Yet this has never been the interpretation of it. It has always been seen as a provision ensuring laws with a constitutional basis can be implemented. It is a logistical provision – if you can raise an army, you can obviously raise and expend the money to pay that army.

The government’s approach goes way beyond modern precedent. If allowed, this would mean Congress could pass any unconstitutional law it wanted (e.g., individual mandate), so long as it was “necessary” to make a constitutional law workable (prohibition on pre-existing conditions)!

Moreover, this line of reasoning completely ignores the second half of the analysis – Is it proper? Well-established precedent says it’s not “proper” if it violates the founding principles, one of which is a government of limited and enumerated powers. This hits on the first part of our discussion – where is the limiting principle if Congress can regulate any “mental decision” or decision to not participate in an activity because it has economic implications? This would be granting Congress a de facto “police power,” something the Founders intentionally avoided doing.

No one is expecting the Fourth Circuit to rule against the government (and they’ll probably get a 3-0 ruling). But that doesn’t mean all Americans shouldn’t be outraged and terrified by the implications of the government’s position. We can only hope that the 11^th Circuit, which will review Judge Vinson’s ruling striking down the entire law, (and ultimately the Supreme Court) provides a panel that has an interest in what our Founders intended and what has made this country so great.

Since passage of Obamacare, Democrats of all stripes have been interested in talking about almost any subject other than health care. Put aside talk of a signature achievement, this has been a Pandora’s box of bad policies and politics that Democrats have had to either defend at their peril or run from without directly insulting their party’s leadership and President. At this point, it’s almost a contest to see what claim proved the most outrageous, non-sensical or downright not true.

One of the first claims to fall apart was President Obama’s oft-repeated promise, “If you’ve got health insurance, you like your doctors, you like your plan, you can keep your doctor, you can keep your plan.” Since passage, health care providers have begun consolidating to avoid business-killing taxes and regulations. Insurance companies have been forced to raise premiums to account for scores of new benefit mandates and restrictions on what types of plans they can offer. And small businesses are looking to cut costs by dropping coverage for their employees who will now have to look to the expanded Medicaid program and the state exchanges to cover them. All of these adding tremendous costs and weight to a system that was supposed to become more efficient and cost-effective.

What this has mean for the private sector so far is an effort to get out. And one year out, over 1,000 waivers have been granted by the Department of Health and Human Services (HHS) to unions, non-profits and companies negatively affected by the legislation. Ironically, a cursory review of the waiver list shows a disproportionate number of unions, whom you may remember, were some of the bill’s loudest proponents while it was being debated. Unsurprisingly, when forced to comply with its provisions, unions demonstrated their special status with the Obama Administration and demanded to be saved from this very expensive law.

And it’s not just the basic health care plans that are being altered. Millions of Americans who rely on their FSA’s (Flexible Spending Account) to pay for their child’s special education schooling or HSA’s (Health Saving Account) to pay for over-the-counter medicines will have to find other, likely more expensive options , to get these benefits or pay for these services. Unfortunately, those seeking to actually restrain health care costs are the real losers because it was programs like HSA’s, FSA’s and Medicare Advantage – which also took a major hit under Obamacare – that sought to inject competition into the process and more importantly, give more control over health care costs to the consumer.

Strangely, Nancy Pelosi’s statement that “we have to pass it to find out what’s in it” has proven quite prescient. Slowly but surely, as more of the law’s thousands of provisions are painfully unearthed, we are forced to deal with the explosion of costs, rosy revenue projections, overly burdensome nature of the regulations, and generally unconstitutional nature of the bill’s central provision. I could go on – and I plan to in future posts – but I feel each (broken) promise and corresponding reality deserves its own special attention.

Perhaps next time I’ll discuss what I think could be the biggest whopper of them all, “Obamacare is going to add 30 million people to the insurance rolls AND save billions of dollars doing it.” I know, try not to laugh too hard.

So, what’s your favorite broken promise of Obamacare?