New GOP Healthcare Plan Is To Kill The ACA By Stealth, Blame Democrats

It is looking more and more likely that the Republican plan for repealing Obamacare is no longer using the vehicle of the AHCA but to kill the ACA by stealth and then try to blame the Democrats in 2018.

There seems to be no urgency in the Senate to move on their version of the AHCA and it is quite possible that it may be impossible to get anything close to what House Republicans and the Freedom Caucus will accept through the Senate even under budget reconciliation. As I noted in an earlier post, the Senate has only until June 15 to pass their version of the AHCA so that it is part of the 2017 budget and effects the 2018 budget baseline. After that date, it must become part of the 2018 budget. Without that lower 2018 budget baseline, it becomes more difficult to pass permanent tax cuts that won’t have to expire after the ten year window. But you get no sense from the Senate that McConnell is even trying to make that date. In fact, you get the opposite impression, that the Senate is in no hurry to act on the AHCA at all, if ever.

Meanwhile, we also learned that Paul Ryan has not even sent the AHCA over to the Senate for consideration. Because Ryan rammed the AHCA through the House without waiting for a CBO score, it was unclear if the bill actually reduced the deficit. If in fact the CBO score showed the AHCA increased the deficit by more than $2 billion and Ryan had already sent the bill over the Senate, the whole process would have to begin all over again in the House. There would have to be a new budget resolution and another vote on another revised AHCA that would reduce the deficit. By not sending the bill over to the Senate, Ryan allows the House to just tweak the AHCA to address the deficit problem if the CBO score expected to be released this week does not show the savings required. But even that would require House Republicans to vote yet again on yet another version of the AHCA but this time there would be another CBO score that could possible be even worse than the first.

Meanwhile, Donald Trump keeps threatening to stop paying the CSRs to insurance companies. CSRs are essentially subsidies paid directly to the insurers in order to reduce insurance premiums. They have been the subject of a lawsuit initiated by House Republicans since Obamacare became reality. The Trump administration had already asked for a 90 day delay in the continuation of the lawsuit when it came into office because of its intention to repeal and replace Obamacare. That 90 day delay is set to expire and the administration is once again asking for another 90 days.

The lack of urgency in the Senate, the uncertainty of the AHCA in the House, and Trump’s waffling on paying the CSRs all create incredible uncertainty for health insurers looking to whether and how they will participate in the AHCA in 2018. And the law requires that the insurers make those decisions by a June 19th deadline. Republicans have made it clear that the deadline will come and go without any more certainty than they probably have now. That means that the default assumption will be that Trump will not pay the CSRs and insurers will have to raise premiums across the board by anywhere from 20%-25% to make up for that or simply exit the market completely. In essence, the general uncertainty and, in particular, the chaos surrounding the CSRs could very well create a collapse in the insurance markets in certain areas and certainly will result in increased premiums.

This, in fact, seems to be the Republican plan, to create so much uncertainty that they force insurers to make the fallacy that Obamacare is imploding a reality. It sets the GOP up for the 2018 election. House Republicans can point to their AHCA vote to please the base. GOP Senators can claim they did not enact the AHCA as passed by the House, satisfying their broader state-wide bases. And Obamacare would be collapsing, just as the Republicans always predicted. And they will put the blame squarely on the Democrats. It is up to the Democrats to lay this future out right now in order to inoculate themselves for 2018 and put the blame on Trump and the Republicans for any problems with the ACA next year. There is no time to waste.