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Will Abortions Be Crowded Out?

Some of the supporters of health care reform have rediscovered worries about crowding out.  That's because it now looks as if the bill may not allow Federal subsidies to be used to buy insurance that covers abortions.  Suddenly, a big chunk of the left sounds like a bunch of Republicans, warning about what happens to insurance markets when the government gets involved:

Abortion opponents in both the House and the Senate are seeking to block the millions of middle- and lower-income people who might receive federal insurance subsidies to help them buy health coverage from using the money on plans that cover abortion. And the abortion opponents are getting enough support from moderate Democrats that both sides say the outcome is too close to call. Opponents of abortion cite as precedent a 30-year-old ban on the use of taxpayer money to pay for elective abortions.

Abortion-rights supporters say such a restriction would all but eliminate from the marketplace private plans that cover the procedure, pushing women who have such coverage to give it up. Nearly half of those with employer-sponsored health plans now have policies that cover abortion, according to a study by the Kaiser Family Foundation.

The question looms as a test of President Obama's campaign pledge to support abortion rights but seek middle ground with those who do not. Mr. Obama has promised for months that the health care overhaul would not provide federal money to pay for elective abortions, but White House officials have declined to spell out what he means.

Democrats had originally tried to get around this by requiring insurers to "segregate" the public funds and only use private funds to pay for the abortion coverage, but this is transparently silly; money is fungible.  There is no effective difference between giving someone $300 for an abortion, and giving them $300 to cover their dermatologist's bills so that they can afford to go have an abortion.

I think that not paying for abortions is morally and politically correct; you cannot use public money to subsidize an activity that half the public thinks is something akin to murder.  Even if Democrats win this battle, the minute the Republicans get control, they'll just undo it.  If you think crowding out is real, then you need to accept the fact that national health care may reduce access to this particular procedure.  Maybe Republicans could learn to love this plan after all . . .

Of course, if you think crowding out is real, there are a lot of other problems with the plan.  Abortion is just the beginning of the distortions it will create in the health care markets.

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Megan McArdle is a columnist at Bloomberg View and a former senior editor at The Atlantic. Her new book is The Up Side of Down.

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