Even if they weren't able to snuff out Obamacare, Republicans appear determined to ensure its marketplaces accelerate their meltdown.
Over the weekend, President Trump castigated the Senate for failing to pass multiple versions of legislation repealing parts of the Affordable Care Act, despite a marathon health-care debate that spanned four days last week. The president has few options left at this point, but he does have power over one crucial part of the ACA marketplaces: payments covering cost-sharing discounts (or CSRs) that insurers must offer to the lowest-income customers. These payments are estimated to total $7 billion this year -- making up about 15 percent of all federal subsidies on which marketplace plans are counting.
At this moment, it's up to the administration whether to make the monthly CSR payments to insurers. So far, it has delivered them around the 20th of each month. But the president tweeted on Saturday that he's considering withholding the next batch (presumably in August), if Republicans don't find a way to move past their seemingly insurmountable gridlock on health care:
If a new HealthCare Bill is not approved quickly, BAILOUTS for Insurance Companies and BAILOUTS for Members of Congress will end very soon!— Donald J. Trump (@realDonaldTrump) July 29, 2017
And this morning:
If ObamaCare is hurting people, & it is, why shouldn't it hurt the insurance companies & why should Congress not be paying what public pays?— Donald J. Trump (@realDonaldTrump) July 31, 2017
White House adviser Kellyanne Conway said yesterday that Trump will decide this week about whether to continue the payments:
“He’s going to make that decision this week, and that’s a decision that only he can make,” Conway said on “Fox News Sunday.”
The authority to pay these subsidies could soon shift from the administration to Congress. A federal district court ruled last year that Congress must use its power of the purse if the payments are to be made. If the Trump administration doesn't continue an appeal of the ruling, which was begun by the Obama administration, Congress would take the reins.
But it's not so clear congressional Republicans would agree to pay insurers, at this point. Senate Majority Leader Mitch McConnell (R-Ky.) appeared to threaten as much in the wee hours Friday morning in a post-mortem after his "skinny repeal" bill failed by one vote. He called on Democrats to share their own ideas for health-care changes -- adding that without a real revamp, he and his GOP colleagues aren't interested in "bailing out" insurers.
"For myself I can say — and I bet I’m pretty safe in saying for most on this side of the aisle — that bailing out insurance companies with no thought of any kind of reform, is not something I want to be part of," the Kentucky Republican said. "And I suspect there are not many folks over here that are interested in that. But it’ll be interesting to see what [Democrats] have in mind."
After a turbulent week that ended in a spectacular meltdown on the Senate floor, Republicans now face the urgent question of how they'll handle 2018 enrollment in the marketplaces, some of which are suffering under big premium hikes and few plan choices. The GOP hoped to reshape these exchanges with legislation, but with that effort stalled, Republicans risk bearing the blame for marketplaces with high costs and limited choices.
Insurers have said the biggest way to quickly improve the marketplaces is for policymakers to guarantee CSRs will be provided over the next few years, giving them certainty as they try to price plans and make decisions about participation. The discounts are available to customers with incomes between 100 percent and 250 percent of the poverty level ($11,880 to $29,700 a year for an individual). Insurers face a deadline in mid-August to finalize their premiums for next year.
The insurer trade association, America's Health Insurance Plans, wrote to McConnell and Democratic leader Charles E. Schumer (N.Y.) last week urging them to fully fund the CSRs.
"Consumers' cost-sharing reduction benefit, which low and modest-income families depend on to afford their out-of-pocket medical costs, must be appropriately funded, or premiums will rise by about 20 percent," AHIP wrote.
|You are reading The Health 202, our must-read newsletter on health policy.|
|Not a regular subscriber?|
AHH: Republicans clearly have a problem -- they are retreating on their biggest political promise of the past seven years. Enter the Problem Solvers caucus, a coalition of roughly 40 House Republicans and Democrats (led by Republican Rep. Tom Reed of New York and Democratic Rep. Josh Gottheimer of New Jersey) who today will roll out a series of fixes to stabilize the marketplaces.
Their biggest ask: Funding for the CSRs. The proposal will also suggest repealing the ACA's medical device tax, enhanced flexibility for states to innovate with their marketplaces and a federal stability fund to assist states in reducing premiums for the most expensive patients. They also want to ease back Obamacare's employer mandate so that it applies only to companies with more than 500 employees.
OOF: Outnumbered but emboldened, progressive Democrats who watched Republicans fail to unwind the ACA are thinking harder about passing major expansions of health-care coverage, my colleague Dave Weigel reports. For many younger activists and legislators, the push to undo the ACA with just 51 Senate votes is less a cautionary tale than a model of how to bring about universal coverage.
"The ambitious idea, discussed on the congressional backbenches and among activists, is not embraced by Democratic leaders...But for many younger Democrats and activists, the Republicans’ near miss on repeal demonstrated boldness from which a future left-wing majority could learn," Dave writes. "Democrats passed the ACA through regular order, with a fleeting, fractious Senate supermajority. Republicans proved that major health-care policy changes can be pushed nearly to the finish line in the reconciliation process, with just 50 supportive senators and a vice president ready to break a tie."
Rep. Ro Khanna (D-Calif.), a freshman who favors universal Medicare coverage, said that Republicans have rewritten the playbook. “When we do have a Democratic president, and when we do have a Democratic majority, I’d support getting this through with 51 votes in the Senate,” said Khanna of a universal coverage, single-payer plan. “That will diminish the role of lobbyists and special interests in trying to get a few senators to block something that everyone in this country will want.”
OUCH: Did Republicans dodge a bullet by failing to pass an Obamacare repeal bill? My colleague Philip Bump explains perhaps the most damaging part of their "skinny repeal:" the Congressional Budget Office estimate that it would raise premiums by 20 percent relative to current law over the next decade.
Let’s say that you spend $1,000 on your premiums in 2017. By 2026 you would have been paying more than $5,100 a year. Those costs would have gone up anyway, thanks to inflation but much more slowly. In a decade, you would have been paying about $2,800 if the premium cost increase matched inflation. Meaning that the Senate bill would have increased your premium costs at twice the rate of inflation.
But how does this compare to premium growth in the past?
Nationally, the cost of premiums for benchmark silver plans on the marketplace increased 1 percent from 2014 to 2015, 8 percent from 2015 to 2016 and 21 percent from 2016 to 2017. Over the 2014-to-2017 period, the national increase was about 32 percent in total, according to data from the Kaiser Family Foundation.
"The Senate bill would have created an increase equivalent to the one seen from 2016 to 2017 in every year for the next decade," Philip concludes. "That’s not what the president promised, and, particularly given how fervently Republicans hammered the increase in 2017, clearly would have opened them up to enormous criticism."
--We've already discussed Trump's Twitter threat to withhold "bailouts" for insurers, but what about his threat to withhold so-called bailouts from members of Congress? White House budget director Mick Mulvaney clarified yesterday, saying the president wants members of Congress to bear more of the burden for their heavily subsidized health insurance if they fail to repeal and replace the ACA.
“I talked to the president at length about that exact issue yesterday,” Mulvaney said on CNN’s “State of the Union.” “What he’s saying is, look, if Obamacare is hurting people, and it is, then why shouldn’t it hurt insurance companies and, more importantly perhaps for this discussion, members of Congress?”
Here's how it works right now. While lawmakers and their staff members buy insurance through the D.C. marketplace (something required under the ACA), their employer -- the House and Senate -- still subsidizes about 72 percent of premiums, lowering their out-of-pocket costs significantly. It's not unusual for employers to heavily subsidize their workers' insurance plans. But some Republicans have labeled this a "bailout" in the past.
--Mulvaney also said the Senate shouldn't turn to any other legislation until it’s voted again on repealing Obamacare. “In the White House's view, they can't move on in the Senate,” he said. “You can't promise folks you're going to do something for seven years, and then not do it.” That would seem to be bad news for a tax code rewrite, which many Republicans want to get on with in hopes of changing the subject.
--Trump is incensed that Republicans have appeared to retreat on their repeal-and-replace promise, firing off more tweets over the weekend demanding they return to the project immediately. (He'd already lambasted them on Friday morning, after he realized even their "skinny repeal" bill had failed.)
Unless the Republican Senators are total quitters, Repeal & Replace is not dead! Demand another vote before voting on any other bill!— Donald J. Trump (@realDonaldTrump) July 29, 2017
Don't give up Republican Senators, the World is watching: Repeal & Replace...and go to 51 votes (nuke option), get Cross State Lines & more.— Donald J. Trump (@realDonaldTrump) July 30, 2017
--The president met with three Senate Republicans on Friday about a new health-care approach that could get 50 votes, Politico reports. Among them was Sen. Lindsey O. Graham (R-S.C.), whose proposal would block grant federal health care funding to the states and keep much of Obamacare’s taxes. White House officials also met with House Freedom Caucus chairman Mark Meadows (R-N.C.) to brainstorm ideas for winning over conservatives.
"Trump seemed optimistic about moving forward on the bill on Friday after the shocking setback this week appeared to cripple his legislative agenda, according to a White House official," Politico's Burgess Everett writes.
"Yet several senior Republican Senate aides and allies of GOP leaders cautioned against any feelings of momentum coming from the White House on Saturday, particularly after Trump again instructed Majority Leader Mitch McConnell to change the Senate rules to a simple majority and gut the legislative filibuster....McConnell has resisted such a suggestion publicly and has been pushing back against Trump privately, according to people familiar with their interactions," he continues.
--Health and Human Services Secretary Tom Price said yesterday on NBC's "Meet the Press" that it's his responsibility to “follow the law of the land" on Obamacare even though his party has failed to repeal it.
“Our job is to follow the law of the land, and we take that mission very, very seriously,” Price said. “The role of the Health and Human Services Department is to improve the health, the safety and the well-being of the American people. And what we understand, what the American people understand, is that their health and well-being is being harmed right now by the current law.”
“Our goal is to put in place, as well as the president's goal, is to put in place a law, a system, that actually works for patients. You can't do that under the current structure,” Price continued.
--Price also didn't rule out the possibility of using his regulatory authority to waive the ACA's individual mandate. “All things are on the table to try to help patients,” Price told Martha Raddatz on ABC’s “This Week.”
Watch a mash-up of the best interviews from yesterday's political shows:
--Congressional Republicans on Friday glumly confronted the wreckage of their seven-year quest, blaming each other and President Trump for the dramatic early-morning collapse of the effort but finding no consensus on a way forward, my colleagues Sean Sullivan, Kelsey Snell and Juliet Eilperin report.
"Some GOP lawmakers clung to long-shot hopes that some version of the legislation might be revived and that a deal might yet be struck before the fall. But the Senate’s rejection early Friday of a last-ditch, bare-bones proposal to roll back just a few key planks of the law left GOP leaders with few options for uniting their sharply polarized ranks," they write.
"Hours later, House Republicans gathered in the Capitol to take stock of the situation. Some raised the prospect of abandoning their long-standing pledge to 'repeal and replace' the ACA and instead working with Democrats to shore up weak spots in the law known as Obamacare. But Trump signaled little interest in that approach, leaving many lawmakers baffled about how to proceed."
“I’m not a prophet,” said Rep. Tom MacArthur (R-N.J.), who helped push an earlier version of the repeal bill through the House. “I don’t know what comes next.”
--Sen. John McCain (R-Ariz.) was the third Republican to vote against the "skinny repeal" bill, ultimately sinking it. He got a lot of praise from ACA supporters, including strategically-placed signs:
Per McCain's wife, Cindy:
Some more great takeaways from The Post and beyond:
- Brookings Institution is holding an event on "Procedure and politics in the 115th Congress" on Wednesday.
- The Senate Finance Committee considers Matthew Bassett, a nominee to be the Assistant Secretary of Health and Human Services on Thursday.
Was this the Trump administration's worst week in Washington?
Watch a heckler interrupt Sen. Ted Cruz (R-Tex.) in Utah over his health-care vote:
What’s next for the GOP’s health care efforts? The White House and senators respond:
Stephen Colbert’s take on the Trump administration’s reported pressure on Sen. Lisa Murkowski (R-Alaska):