REPUBLICAN SENATORS remade their tax bill into an Obamacare repeal bill, announcing Tuesday that they inserted an Obamacare sabotage device into the text. In a stroke, they turned a fiscally irresponsible tax plan into a monumentally unwise piece of social policy that would do much more than widen the deficit. If passed, it would be the most significant health-care shift since the 2010 Affordable Care Act — and in a decidedly negative direction.
The Senate GOP's new bill would eliminate Obamacare's "individual mandate," which requires all Americans to get health coverage if they can afford it. Independent health-care analysts and the Congressional Budget Office, Congress's official scorekeeper, agree that this move would deeply undercut the Obamacare system. The CBO estimated last week that ending the mandate would lead to 13 million more Americans lacking health-care coverage.
Yet, for Republicans, the coverage loss is not a regrettable side effect of an otherwise sensible policy. It is the point. Fewer people covered means that the federal government would save money that the treasury would have otherwise spent on their health care, such as by helping them buy health insurance or offering them Medicaid — $338 billion over a decade. Republicans want to use that cash to help finance the rest of their tax bill. They could have removed some of the bill’s expensive and unnecessary giveaways to the wealthy, such as its rollback of the estate tax. But they opted instead to raise money by ballooning the ranks of uninsured.
Republicans can try to comfort themselves by arguing that eliminating the mandate is good policy on its own merits, simply allowing consumers who do not want coverage to decline to buy it. But the move would also price people who seek insurance out of the market. Killing the individual mandate would encourage people to forgo buying insurance until they got sick, which would drive up premiums for all those who remain in the system. “The resulting increases in premiums would cause more people to not purchase insurance,” the CBO explained, estimating that premiums would rise an additional 10 percent per year.
Repealing the mandate would be the most spectacular instance yet of a GOP action that has the effect of raising Obamacare prices, which the Republicans continually complain are too high. In October, President Trump halted payments the federal government promised insurers in exchange for participating in Obamacare markets, forcing insurance companies to raise premiums to compensate. The Trump Department of Health and Human Services then sabotaged this year's open enrollment period, which could also result in fewer people covered.
Some have tried to do better; a bipartisan group of senators developed a compromise bill that would help stabilize Obamacare markets. But it has not passed. There is talk of marrying this compromise bill with the individual-mandate repeal, but cutting the mandate would do much more harm than the compromise would do good.
If Republicans really believe that mandate repeal is good health-care policy, they should seek to pass it on its own, with hearings, markups and debate. But a fair process would only clarify further that the policy is ruinous. Republicans who in July recoiled at an attempt to ram through the Obamacare "skinny repeal" have even less reason to vote for this drastic, ill-considered and last-minute attempt to sneak repeal into a tax bill.
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