The Politics Of Alexander-Murray And Restoring The CSRs
It would seem like a no-brainer that paying out more taxpayer dollars for worse coverage and higher premiums would be a bad idea. But we live in the fantasy world created by Republicans and Trump, so that is the prospect we are facing. The Alexander-Murray bill would at least try to rectify this problem by restoring the CSR payments and funding for ACA outreach in exchange for allowing states more flexibility with their programs and the expanded ability to offer catastrophic plans for those who can not afford coverage. In a normal world, this would almost be a win for Republicans as they get more flexibility for the states in return for basically returning to the Obama-era status quo. But, in the current environment, the prospects for passage seem limited.
Trump has already done at least four complete flip-flops on the bill but I think everyone knows he will sign anything that hits his desk and call it the greatest thing since sliced bread and something only he alone could accomplish. The prospects in the Senate are far brighter but not necessarily good either. The fact that the bill forces Republicans to actually vote to stabilize and support, via the outreach effort, Obamacare will obviously peel off a significant number of Republican votes. That means that Democrats will likely provide the majority of the yes votes with a minority of Republicans pushing the bill over the top. That fact alone may force Mitch McConnell to not even allow the bill to come to the floor for the vote.
A similar dynamic exists in the House. If the bill actually came to the floor for a vote, passage would once again rely on virtually all Democrats allied with a handful or two of Republicans. Under the ridiculous Hastert rule, however, no bill can be brought to the floor without the support of a majority of the GOP caucus, pretty much dooming the bill before it can even get started in the House. That puts Paul Ryan in the hot seat once again, caught between his hard right which has no interest in seeing anything help maintain the ACA and his “moderate”, and I use that word loosely, members in New York, California, and other blue states. Perhaps that is why his spokesman says, “the Senate should keep its focus on repeal and replace of Obamacare.”
I know Democrats have gotten used to being the adults in the room, but we should be aware of the potential political implications of this bill. Trump’s threat and eventual refusal to pay the CSRs has already caused significant and unnecessary premium hikes for 2018 across the country. In fact, it is believed that 50%-60% of the 2018 premium hikes were merely to offset the expected loss of the CSR payments.
For consumers who receive subsidies base on a maximum fraction of their income, rates will not rise and the difference will be made up by tax credits which is why Trump’s cut-off of CSRs will actually cost the government more money. But for wealthier consumers, who do not receive subsidies, are far more vocal about the rising cost of Obamacare, and are far more likely to vote in the midterms, the premium hikes will definitely have an impact. Now, the brunt of those premium hikes may be avoided by dropping down from a silver plan to a bronze plan. But that usually requires higher deductibles and higher copays.
The problem, then, with Alexander-Murray is that it does nothing to resolve these problems in 2018. The bill will kick in in 2019, meaning that it’s not inconceivable that consumers will see minimum premium hikes or even decreases in 2019, premiums that will be announced just days before the 2018 election. This will create a situation in early 2018 where Republicans can continue in their efforts to roll back Obamacare, gut Medicaid, perhaps even cut Medicare, while pointing to the current high premiums as indicative of the failure of the ACA, all with the knowledge that, even if they do not accomplish any of that, they will still be able to run for re-election in 2018 with the claim that their efforts have resulted in flat or reduced premiums for 2019.
That seems like a major political problem for Democrats, especially when you consider how important the 2018 election will be. Now, perhaps Schumer and Pelosi know that this bill will never get through Congress and it is a way to continue to hold Republicans feet to the fire on healthcare. But, if the bill ever does come up for a vote, Democrats need to really think hard about helping it pass. I know it seems cruel and crazy to vote to sustain a system that will provide less coverage for higher premiums while costing the government more. But sometimes being the adult in the room may mean making sure everyone understands who the children really are.
