Why Trump’s Art of the Deal Failed
He knows little about health care, and Ryan had the wrong plan.
Paul Ryan and Donald Trump.
President Trump may know a thing or two about hotel deals, but he totally flubbed the art of the deal with Republicans in Congress as they tried to replace Obamacare.
So did his quarterback in the House, Speaker Paul Ryan.
Above all, they didn’t listen to the people in the red states who got them elected. Their American Health Care Act (AHCA) didn’t help make health care more affordable for resentful middle class voters. Those high costs have robbed each household of several thousands of dollars.
Instead, ACHA tilted toward tax breaks for the wealthy. Who asked for that?
The Achilles heel of President Obama’s Affordable Care Act was its lack of affordability. Yet Ryan and Trump did little to lower health care costs. How could you blow that opening, especially when private businesses have figured out a good number of ways to deflate costs?
Finally, there was no over-arching theme to ACHA. There was nothing the American people could grab onto.
They could have required fixed prices for a majority of procedures – the ultimate in transparency. Customers — employees and employers — hate their high, inscrutable medical bills. The GOP didn’t solve that glaring issue.
Republicans could have written provisions to stabilize insurance markets, which are a shambles under Obamacare. They did throw in a last-minute provision for high-risk pools, which would lower premiums by socializing catastrophic coverage. But it came too late.
As for their ground game in Congress, they obviously did not have game plan that moved the chains. Unlike President Obama and Nancy Pelosi in 2010, Ryan and the president didn’t build coalitions to back their bill. Who was for it?
And Trump’s entrance into the fray was amateur hour. One of the fundamental principles of negotiating is to learn the full fact base surrounding the pending deal. The party that has the best grasp of the territory, the most information and a clear grasp of realities has the edge in the bargaining process.
It is abundantly clear that our president knows very little about the delivery of health care in America. That jumped out in the presidential debate when Sen. Marco Rubio grilled him about his repeal and replace stance. Candidate Trump responded that he was going to remove “lines around the states.” He meant selling individual insurance policies across state lines. (Most analysts don’t hold out much hope for lowering premiums via cross-border competition.) Is that all you’ve got for a plan? Rubio asked. Trump essentially said yes.
Trump knew close to zero about health care policy or politics at that stage. And he doesn’t appear to have learned a whole lot since.
He was effective in real estate deals because he knew that market space. Absent such knowledge in health care and the art of governance in a democracy, he blew it when he tried to cajole and bully GOP congressmen.
When you are doing political trade-offs, you have to know what cards to play and what cards to fold. You have to know the critical elements of the deal.
Going into the deal making , you have to know what you want to come away with and what you can surrender. You have to know what the other party wants and what they will let go.
For example, the GOP leaders could have curbed run-away Medicaid costs by giving poor people a medium high deductible offset by a health account. That drops costs sharply.
Gov. Walker’s coverage of 100% of the people under the poverty line has played well. Those over 100% are eligible for subsides for private policies. Why did they not follow Walker’s lead? Just dumping poor people from coverage played poorly.
Though the president didn’t have an end game, Ryan’s did: tax cuts, entitlement reform and smaller government. None of those three ideological goals meets peoples’ desires for affordable care.
The president and the speaker picked up their cards and said they weren’t going to play any more. They want to let House members up for reelection stew in their juices for not going along with the poorly crafted ACHA.
But there is no way that this is a “done” deal. Out-of-control health costs are still the number one economics issue in the country, and it isn’t going away.
The health cost escalation will make it near impossible to:
• Balance the federal budget.
• Reduce the federal deficit.
• Pay for other national priorities like defense, education, cleanup of the Great Lakes
* Build a wall..
• Keep Social Security solvent.
As said before, the health cost issue is the elephant in the room. (Pun intended again.) It wasn’t the central issue in the 2016 campaign for no reason.
John Torinus is the chairman of Serigraph Inc. and a former Milwaukee Sentinel business editor who blogs regularly at johntorinus.com.
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Sorry but John missed a ton of stuff, too much to type.
That sums it, JOHn. Affordable Care Act fails because it is not affordable and there is no care. It’s only about insurance and as long as insurers and providers are the only ones who know the cost of anything, costs will never get affordable. Hell, they may never be affordable anyway. Affordable care may be an oxymoron.
American Health Care Act failed for similar reasons. It’s not affordable, though it never claimed to be. And there is no care. Again it is all about insurance.
YOU want affordable care? Draft doctors, NP’s and PA’s into the Medical Service, where they will serve for ten years, in return for having their education comped. Put them in those federal care centers Ryan touted and let us all pay fee-for-service.
The point is, Give CARE, not insurance.
Those are great points WCD. You sure told John!
A health insurance policy with high deductibles is not health care, any more than a lottery ticket is a retirement plan. The clear message delivered by Trump / Ryan is their plan was to eliminate health care for poor and vulnerable, so that wealthy could feel more comfortable.
It’s obvious from their actions; Democrats feel that health care is a right and Republicans feel health care is for those that can afford it.
“…curbed run-away Medicaid costs by giving poor people a medium high deductible offset by a health account.”
Who funds the health account? The poor can’t afford to or they would have health insurance already.
My brother has ACA insurance and it is affordable and he is happy to have the coverage.
The Republicans do not believe in healthcare for all. They are more interested in market confusion and making it easier to exploit desperate people in need of healthcare services. There plan is a real stink bomb and a tax break for their wealthy donor class.
Health insurance arose out of WWII as a model, and is a market failure. 80% of bankruptcies are due to medical costs. Almost all modern countries have realized this and gone with universal coverage that includes dental, eye, and mental care. All pay in, with no free riders and free loaders that steal from people that pay in today.
Did I miss the part where John said”self insurance”? I would agree with self insuring the nation. Or is it only business that should enjoy the savings from a medicare for all/self insurance program?
Very well said, John. Transparent charges, accountable billing, carrier competition, coverage for pre-existing….these are what people expect from ACA or AHCA. This nonsense about repealing and replacing is campaign rhetoric. Refine the existing programs to address these things and people will be more satisfied.
How in the world does Paul Ryan bring a bill to the House that doesn’t have consensus ?
He may be a “policy wonk”,but he stinks at legislating
-” Might work with moderate Democrats ” ( Sure Donald )
Healthcare is broken because so few pay into it. 6 out 10 Wisconsin born babies were funded by the tax payer via medicaid. If your over 65 you pay a small share of your healthcare thru Medicare. If your part of the Millennial generation you potentially pay nothing until your 27 years of age. The biggest kicker is Obama funding the expansion via federal aid to medicaid, reverting that would have busted Republican red Ohio’s budget. Trump stated it was better to leave Obamacare as it is politically and that is what he just did. No serious plan will happen until Chuckie Schumer and Trump settle their grudges.
Nice revisionist history Jason. Your hero Trump repeatedly promised he would “immediately” repeal and replace Obamacare. So much for that promise.
Healthcare is a solvable issue. The USA spends over $1 Trillion annually on Defense (includes dark money and interest on the debt) without any accountability. The Pentagon cannot account for $10 Trillion in past expenditures. Since WWII, the Pentagon has been granted this blank check with the promise of full spectrum dominance on air, land and water. We are a nation that is stuck on insanity as we pass this $20 Trillion debt onto future generations in an immoral intergenerational theft scam.
Healthcare, Medicare and Social Security benefit people and have real value. Health care is nearly 1/5 of the US economy. It is a solvable issue through universal coverage that includes eye, dental, and mental health issues. All pay with no free riders and free loaders. Republicans prefer mass market confusion and failure since it is easier to profit and exploit desperate people in need of health care services and bankrupt them – and they call this is choice.
Jason, one of the few well thought out out entries on this biog.