The current incoherent struggle over health care reform is fast coming to a head. This past week, Sen. Max Baucus' "mark" on America's Health Future Act laid an egg largely because it was too timid to satisfy the health care hawks in the House of Representatives. Baucus did not build in a public option; and he showed specks of mercy to employer health care plans that the democratic House regards as the villain of the piece. So the political action may well swing back to the House's grotesque confection, H.R. 3200--America's Affordable Health Choices Act of 2009. Good grief.

As a small-state libertarian, I cringe. To see how revolutionary the legislation is, first note how H.R. 3200 eviscerates President Obama's oft-repeated promise that "if you like your current health care program, keep it." Yes, but only for a day. The House's "grandfathering" provision of existing plans is gutted by grotesquely restricted limitations. Stable health plans necessarily experience a turnover in enrollees, in policy provisions and in prices. But Section 102 of the House Bill allows any of these commonplace events to knock out grandfather status. Add one new employee to the rolls, and the plan is no longer grandfathered.

From day one all private health plans face this Hobson's choice: Either go through the government exchange or go it alone. That freedom, however, comes at a steep price, as H.R. 3200 offers the carrots of fancy tax and affordability credits only to employers who go through the government exchange. Simultaneously, it heaps heavy payroll taxes on plans that steer clear of its clutches.

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