Congress returns from its recess next week with a government shutdown looming next Friday. “If Congress does not strike the first truly bipartisan deal of his presidency by then, Donald Trump will spend his 100th day explaining to the public why the government he’s charged with running has partially shut down.” How Trump’s First 100 Days Could End in a Government Shutdown.
But first, Tea-Publicans apparently believe they have enough time to try to raise a zombie “Trumpcare” plan from the dead. Sarah Kliff reports at Vox.com, House GOP members are floating a new health plan. Here’s what’s in it.
Leaders of the staunchly conservative Freedom Caucus and the more moderate Tuesday Group have reportedly hashed out a proposal that would let some states ditch key Obamacare policies, such as the requirement to charge sick people the same for coverage as healthy people. States would also have the choice to opt out of the Affordable Care Act’s essential health benefit requirement.
The Huffington Post reported on the development late Wednesday night, and Politico posted a short white paper early Thursday describing the changes. We still don’t know how final this amendment is or which House Republicans support the changes.
What we do know is that this latest proposal doesn’t do much at all to assuage concerns about the older proposals. While it meets many of the demands of the party’s far-right wing — namely, the deregulation of the individual insurance market — it does nothing to address concerns about massive coverage loss. Instead, it likely makes those problems worse.
“It’s pretty frustrating to see they’ve worked so hard to come up with another Rube Goldberg–type solution,” says Craig Garthwaite, a health economist at Northwestern University’s Kellogg School of Business.
Republicans want to let states waive two key Obamacare provisions
The amendment takes aim at two Obamacare policies that have long been on the Freedom Caucus’s hit list: community rating and essential health benefits.
Before the Affordable Care Act, insurance companies would “individually rate” each patient who wanted to buy coverage on the individual market.
They would send out detailed questionnaires about a potential customer’s age, medical history, and current behaviors (whether she currently smokes, for example, or is pregnant) and then set a specific premium for that person. It was meant to reflect the insurers’ best guess of how expensive that individual’s health care would be.
Obamacare banned this so-called individual rating. It required all insurers, instead, to use “community rating”: setting one premium for the entire community of people buying coverage. This had the practical effect of driving down premiums for sick people, who no longer had to bear the full burden of covering their more expensive health needs.
It also drove up the costs for healthy people, who were suddenly asked to pay more to help cover those expensive bills from the sicker people.
The Obama administration made this change because it felt like this was a good trade-off. It prioritized getting sicker people access to health insurance.
This GOP amendment to let states waive community rating would once again allow insurers to charge people based on their expected health care costs. Insurers would not be able to deny coverage to people with preexisting conditions, but they would have free rein to charge them especially high premiums [and thus price them out of affordable insurance coverage, same as before Obamacare.]
They could also opt out of the health care law’s essential health benefits for the same reason. This is the core set of medical services that the Affordable Care Act requires all insurers to cover, including things like doctor trips, hospital stays, maternity care, and mental health services.
The GOP amendment would allow states to opt out of these two provisions if they could show they aimed to do one of three things: “reduce premium costs, increase the number of persons with healthcare coverage, or advance the benefit to the public interest of the state.”
This does not set an especially high bar for this waiver option. It means that states could, for example, end the essential health benefits requirement because they believe it will lower premium costs. And of course it would! Tell insurers they no longer have to cover expensive mental health services or maternity care, and average prices would almost certainly drop. The same would happen if insurers had the option to charge sick patients prices they couldn’t afford. Those people would drop out of the market, and premiums would decline.
“If it could be shown that states could lower premiums on an identical policy, that would be one thing, but that is not the metric being used here,” Garthwaite, of Northwestern University, said. “If you allow the essential benefits to go away, you will have lower premiums because it’s a skinner product. The people working on this don’t seem to understand the market ramifications of what they are doing.” [Actually, they do.]
Republicans’ last version of the health care bill would have caused 24 million Americans to lose insurance coverage, way too large a number for many Republican House members to stomach.
Tacking on this new amendment would undoubtedly cause an even greater decline in coverage, as sicker patients would be priced out of the market in states that take up the waiver.
This then invites the question: Who is this new amendment going to win over? Will House Republicans get behind a bill that causes more coverage loss than the one they ditched a month ago? What has changed between now and then?
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Then there’s the question of the Senate. The more moderate Senate Republicans would be unlikely to rally behind a plan that causes massive coverage loss.
They might not get the chance to. Many of the changes outlined in the amendment would struggle to move through the reconciliation process, which requires all policies to be directly related to the federal budget. It would be tough to make the case that re-regulating the individual market counts as budget policy, and that these changes ought to be allowed to move forward.
Last, these are the exact type of changes that will make the Republican health care bill even less popular than it already is. The most recent polling showed just 17 percent support for the American Health Care Act, and the changes outlined in this memo will make health insurance less generous and the bill less popular — making it hard to see how this becomes a winning approach.
The Huffington Post further explains:
The reality, however, is that insurers would be able to effectively deny coverage by pricing sick people out of the market.
“This effectively allows states to eliminate the ACA’s guarantee of access to insurance at a reasonable price for people with pre-existing conditions, in the interest of lowering premiums for people who are healthy,” Larry Levitt, senior vice president at the Henry J. Kaiser Family Foundation, said upon seeing a description of the proposal. “It seems to tilt heavily towards what the Freedom Caucus has been looking for.”
Republicans argue that the high-risk pools would then cover those people, taking them out of the regular insurance pool and lowering prices for everyone else, but high-risk pools have traditionally been underfunded by states and the federal government, resulting in poor coverage and high costs for those who need insurance the most.
Those concerns may be significant enough that, even with MacArthur’s blessing, the deal does not win over moderates. The concessions also might not be enough for some conservatives, who have expressed issue with Republicans establishing an advance refundable tax credit to help pay for insurance.
The amendment wouldn’t seem to address the big concerns moderates have expressed ― like raising the cap on how much insurers can charge seniors or cutting $880 billion from Medicaid. These changes are among the reasons that the Congressional Budget Office predicted the House health care legislation would increase the number of people without insurance by 24 million within a decade.
Many Republicans ― particularly in the Senate ― have said such deep cuts are not acceptable.
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Public opinion has also shifted since the repeal effort began in earnest ― and it has shifted decisively against Republicans and their cause. The Affordable Care Act is more popular than ever, and in a recent Pew Research Center poll, 54 percent of Americans said they trusted Democrats more than Republicans on health care, while just 35 percent said they trusted Republicans more. That’s the biggest advantage for Democrats on health care since 2009.
In short, some leaders in the GOP conference might think they have a deal, but they also might have just found a way to make the bill even more unpalatable for Republicans, thus bringing Congress no closer at all.
Still, Speaker Paul Ryan (R-Wis.) suggested that Republicans were getting close to a deal. “We’re in the midst of negotiating sort of finishing touches,” Ryan said.
Tierney Sneed at Talking Points Memo adds, Expectations Already Being Lowered On Latest O’Care Repeal ‘Deal’:
Within hours of reports that the members of the the House GOP’s far-right and centrist wings had reached a deal that could bring a failed Obamacare repeal bill to life, expectations for quick and certain revival are already being lowered elsewhere on Capitol Hill.
A senior GOP aide told TPM via email that the question is whether the compromise proposal “can get 216 votes in the House and the answer isn’t clear at this time.”
“There is no legislative text and therefore no agreement to do a whip count on,” the aide said, adding that a full-conference phone call scheduled for Saturday where the deal reportedly would be discussed “was noticed last week and is routine before we come back in session.”
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It appears that the pressure to advance a quick deal on a heath care overhaul is coming from the White House, based on the reporting of the Washington Post’s Robert Costa.
Likewise, Politico reported that a White House official said that they are “close” to shoring up the votes needed to pass the bill, but “people don’t want to commit without seeing the text.”
And here is the real reason behind what is really driving this push for zombie “Trumpcare”:
The conflicting narratives suggest top administration officials and House Republican leaders are either miscommunicating — or, more likely, that White House sources are squeezing Speaker Paul Ryan and his team, telling them to move quickly. Notably, the same senior White House officials who suggested a vote would occur next week also said the text of a new deal will likely be circulated Friday “or by the weekend.”
The claim perplexed some GOP insiders who don’t expect legislative text for a few days, at the earliest.
The back-and-forth highlights just how impatient Trump is growing with Congress. Administration officials are feeling inordinate pressure to advance the legislation out of the House, fearing that failure to repeal the health care law will dominate coverage of the administration’s first 100 days, which end next week, officials say.
Maybe the White House should be more concerned about that partial government shutdown next Friday on Trump’s 100th day instead.
But wait! There are always those cost-sharing reductions, or CSRs, that are the subject of the House v. Price lawsuit – formerly known as House v. Burwell – pending before the court of appeals. Democrats want the CSR’s addressed in the Continuing Resolution (CR) to fund the government next week. But Trump could decide to blow up Obamacare out of spite. Trump’s nuclear option on Obamacare, explained:
Right now those subsidies are facing a huge threat. Trump can try to cut off those payments, which would disrupt Obamacare’s insurance markets and maybe cause them to collapse entirely. And Trump is threatening to do just that — he could end the federal government’s defense of CSR payments in a lawsuit working its way through federal court.
To counter, Democrats in Congress are now warning that the government could shut down at the end of this month if Trump and Republicans refuse to make the payments. They say they would block any spending bill that doesn’t fund the CSR subsidies.
So Obamacare isn’t out of the woods yet. Even if the law stays on the books, Trump and the Republicans who now control the federal government still have an opportunity to sabotage it or hold it hostage to try to force Democrats to compromise on a new health care plan. The cost-sharing subsidies — an intricate part of the law nonetheless made vulnerable by a GOP legal challenge — gave them that chance.
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This lawsuit gave them another chance to undercut the health care law, even without passing their own bill. Because if Obamacare is here to stay, then the fate of the CSR payments is now an essential question.
So Trump could either choose to continue defending the CSR subsidies, making payments in the interim and keeping the markets stable — or he could decide to drop the suit, stop the payments, and precipitate a market implosion that could leave many vulnerable Americans without health coverage.
If the House prevailed, and the CSR payments were not paid, insurers would still be required to reduce cost sharing, but they would now have to do it without the government’s help. They would have to raise premiums dramatically to make up the lost revenue.
Democrats are trying to force Trump’s hand, tying the CSR payments to a must-pass government spending bill. Democrats will demand that funding for the payments be included in the spending bill that must pass next week to avoid a partial government shutdown.
“If congressional Republicans agree to pay the CSR subsidies, that renders the issue being litigated effectively pointless. The payments will be made, Congress will have approved them — there is effectively nothing left to sue over.”
Worst case scenario next week: Congress wastes its limited time trying to pass a bad zombie “Trumpcare” plan that will likely fail, only because Trump demanded it, then Congress fails to pass a CR spending bill in time to keep the government from shutting down on Friday. And Trump could use the “nuclear option” to disrupt health insurance markets over the CSR payments and sabotage Obamacare out of spite.
A government shutdown and taking health care away from millions of Americans — all in all a good week for “President” Stephen Bannon and his radical plan for “deconstruction” of the federal government. Let chaos reign!