DC Deciphered

So, after a long, long wait the GOP’s “repeal & replace” bill for Obamacare is finally here!  Was it worth the wait? I was about to say it depends on who you ask, but it actually seems like there isn’t anybody who’s too excited about this bill.  There are already lots of good summaries out there explaining what’s in the new GOP bill, so I’m not going to go over that in detail.Instead, I’m just going to share some thoughts I’ve had while watching the roll out of the bill. 

This is basically just a collection of random observations, some things I thought deserved extra attention or that struck me as interesting or that plain old bugged me. The list was getting long, so I split it into 2 parts.  Part 2 may come later today, but possibly not until tomorrow. So here goes . . .

1. First, as bad as this plan is, it could have been even worse. The GOP is limited in the changes it can make to Obamacare, at least for now, because of procedural rules.  They’re planning to use a special procedure called “reconciliation” in order to get the bill passed through the Senate.  They’re doing this because bills passed by reconciliation only require 50 votes and therefore cannot be filibustered.  Since the GOP only has 52 members in the Senate, they need to use this process in order to have any hope of passage.   But reconciliation places limitations on the types of provisions that can be in the bill, basically only allowing items related to the budget.  So this is constraining some of what the GOP is able to do here.

So, yes, the GOP is keeping a lot of the popular provisions from Obamacare, such as the ban on preexisting conditions discrimination and allowing children up to age 26 to stay on their parents’ insurance.  But here’s the thing: they actually can’t repeal those provisions, because of the rules of reconciliation.  Maybe they would have chosen to keep those things anyway, since they are extremely popular and repealing them would’ve been politically stupid.  But if they were repealable they’d likely have a big fight on their hands right now with the ultra-conservative wing of the party demanding that all of Obamacare must go, no matter how popular.

(But also make a note for later on that some of these things may be able to be changed administratively, basically just by HSS Secretary Tom Price declaring a rule change.  For instance, he may try to cancel the “essential health benefits” requirement, one of the provisions they can’t get rid of through reconciliation).

2. The tax credit provision and the Medicaid provision are 2 of the most significant provisions of the bill, as they will largely determine how many people will continue to be able to get health insurance. They are also the 2 most controversial.  Even though the tax credits in the GOP bill are way less generous than the subsidies in Obamacare, the ultra-conservative wing of the House, known as the Freedom Caucus, doesn’t want to offer tax credits at all, seeing it as a new entitlement or “Obamacare lite.”  But Party leaders and the more moderate members are very worried about the idea of their bill causing millions of people to lose insurance, so they don’t want to make the bill any stingier than it already is.  (The tax credits in the bill are “refundable tax credits” which means that people will get the full credit even if the amount is more than they owe in taxes.  So this is particularly offensive to the ultra-conservatives).

It’s a somewhat similar story on Medicaid, though party leaders are more in line with the conservative wing on this one, as cutting Medicaid has been one of Paul Ryan’s greatest goals for years.  An earlier version of the bill had much bigger cuts to Medicaid, but a number of GOP governors and four of the more moderate GOP Senators had already made it clear they would not get on board with that.  So this version of the bill is more generous than earlier versions, but still makes significant cuts, not just to the Obamacare Medicaid expansion, but to the original Medicaid system that existed long before Obamacare.

It’s not clear yet whether this change will be enough to get the hesitant Senators on board.  If they lose more than two, the bill can’t pass the Senate. (But there are also 3 Senators who oppose the bill from the other end of the spectrum, teaming up with the ultra-conservatives in the House who want full repeal:  Rand Paul, Ted Cruz and Mike Lee.  So this complicates the task even more)

3. So it’s probably becoming clear that the GOP has a major battle on its hands, even without having to factor in the Democrats. They have the ultra conservative wing of the House, plus a few ultras in the Senate, who will accept nothing less than full repeal. Any “replacement” in their mind must be entirely free-market based, leaving the government completely out of it.  On the other end of the spectrum are the moderate Senate Republicans who won’t accept huge cuts to Medicaid and also probably wouldn’t vote for something that didn’t have some sort of financial assistance for the non-Medicaid people as well (e.g. the tax credits).  This all goes back to the GOP’s dilemma that I laid out in Queasy, Breezy, Beautiful.

On top of that, the conservative outside groups, such as those backed by the  Koch Brothers (Americans for Prosperity) as well as Club for Growth and Freedomworks have also – like the ultras in Congress – come out against any bill that contains tax credits.  I wonder though if the ultras will come around when they realize it’s either this plan or nothing (meaning being stuck with Obamacare instead)?

4. We don’t know exactly how many people will lose insurance under the GOP plan, because it has not been “scored” by the Congressional Budget Office (CBO) yet. “Scoring” means the CBO gives a non-partisan analysis to proposed legislation to let Congress know how much it is expected to cost, and (for a bill affecting health insurance) how many people will gain/lose insurance.

Typically, committees won’t begin to take votes on a bill until they see the CBO score, because Congress members generally like to know the effects of the legislation they’re voting on.  But the GOP is in such a rush to get this bill through before any more discontent can grow or coalesce that they’re planning on beginning committee votes, and possibly even the entire House vote, without a CBO score.  But there have been early indications from the CBO that it doesn’t look good, and outside groups who’ve analyzed it say anywhere from 5-20 million people could lose insurance.

5. There’s a really frustrating irony here because for 7 years, Republicans have aggressively  pushed the lie that Democrats rushed Obamacare through passage, that they rammed it through before the public could even know what was in it. In particular, Republicans have a favorite myth where they twist a quote from Nancy Pelosi to make it sound like she came right out and admitted that. None of that is true, and in fact Democrats went through a very long, painstaking process to develop their bill over the course of more than a year.  During that time they held numerous public hearings and got numerous “scores” from the CBO (which they used to then make alterations to improve their bill).  And the final bill was available to the public online for more than 30 days before Congress voted on it.  Now, the GOP really is doing the exact thing they spent years falsely accused Democrats of doing.

Yet Sean Spicer still pulled out this old trope about Nancy Pelosi Tuesday at his press conference as a point of comparison to the supposedly deliberate and transparent GOP process.  Republicans literally had their bill hidden under lock & key last week, keeping it even from most of their own party members. We have no idea what their process was for coming up with the bill. The bill was just unveiled Monday, and they’re already planning to start committee votes on it in a couple days – again, without even having any idea of  what the impact will be on the budget or on human lives because they’re not even waiting for the CBO to score it.

6. Prior to this week, I had a teeny, tiny bit of hope that Trump might be unhappy with the plan the House was coming up with, since it seems clear their plan will cause many people to lose insurance, particularly many in his own base. And Trump has said throughout his entire campaign and since that he wants everyone to have beautiful insurance. And Trump’s word is certainly not gospel, but he’s a guy who really, really wants people to like him and who wants to do something that makes a big impact (in a way that gets him kudos not criticism), so I had a bit of hope that this was an area where he’d really want to keep a promise.

But at the same time part of me feared that Paul Ryan (or a Ryan lieutenant) would come to Trump with this plan and tell him it’s the most freedomy plan full of freedom that will allow people to be free to choose whatever insurance they want.  And Trump, being thoroughly ignorant on policy and too lazy to do any homework to check the facts, would take his word that the plan is great and give it the thumbs up.  Unfortunately, it looks like we got door #2.

7. The bill encourages insurance companies to pay their highly paid CEOs (and other executives) even more. Obamacare put a $500,000 cap on tax deductions for executive compensation. The GOP bill gets rid of this provision.  How does this help Americans get better health insurance for lower premiums you ask??  Ya got me.

To be continued in Part 2 . . .