Health care reform: Less spending, less government control

Editor's note: Former cabinet member and Utah Gov. Michael O. Leavitt is the newest member of the Deseret News Editorial Advisory Board. Last Saturday, Leavitt joined Newt Gingrich and Harvard economist Regina Herzlinger to discuss health care reform at a retreat for 240 Republican congressional representatives. This column summarizes his advice to them on the vote to repeal and replace the Patient Protection and Affordable Care Act.

On Wednesday, it appears the U.S. House of Representatives will vote to repeal the Patient Protection and Affordable Care Act (PPACA), also known as Obamacare. Republicans will succeed in a symbolic passage of the bill in the House, but not enactment. The Democrat-controlled Senate will choose not to act.

Although Republicans in the House of Representatives will not succeed in immediate enactment of a new law, this is an important moment. Passage of a repeal bill in the House of Representatives fulfills the first half of their campaign commitment to "repeal and replace." In the short run, it initiates a multi-front assault on the PPACA, using every tool available to them by virtue of their control of the House. In the long run, it constitutes the opening bell in a new round of an ongoing struggle between conservative and liberal philosophies of government's role in American society.

The health care debate is important for another reason. It will greatly influence U.S. viability as a global economic leader in the next quarter century. Health care's dominance in public budgets is causing neglect of education, infrastructure, research and development and energy development. Worse yet, our health-spending-driven deficit excess undermines global confidence in the dollar and our credit standing among nations.

I suggest five principles to guide congressional thinking on replacing Obamacare:

First, define contributions, not benefits. When government helps people buy insurance, the contribution should be a defined amount, not an unlimited entitlement. This has been done with success in recent decades. Most people now have a pension with a defined contribution. Medicare Part D, the prescription drug benefit, employs the same method. Rather than providing another unlimited entitlement, the government should contribute a defined amount. Insurance companies will compete to offer the best plan. If consumers want more coverage than their subsidy provides, they can buy it. Doing the same thing with Medicare Part A and B would transform Medicare.