Hopes Fade That Congress Will Stabilize Obamacare

A lot’s happened since Lamar Alexander and Patty Murray were all the bipartisan rage for their efforts to stabilize Obamacare markets.

Remember “Obamacare stabilization,” one of the great bipartisan causes of 2017? Mostly in response to the president’s suspension of so-called cost-sharing-reduction reimbursements to insurers required to limit the out-of-pocket costs to low-income participants in the Obamacare markets, legislation developed by Senators Lamar Alexander and Patty Murray developed a real head of steam in the Senate, until opposition from House Republicans and the White House stalled its momentum. Then in December, Senator Susan Collins got assurances from both Mitch McConnell and the president that both the Alexander-Murray legislation and a bill she co-sponsored with Florida Democrat Bill Nelson giving states money to set up reinsurance pools for high-cost Obamacare patients would be included in an omnibus spending bill that was being negotiated. Collins gave Republicans a critical vote for their tax bill in no small part due to these assurances.

Well, nearly three months later, the promises to Collins have yet to be kept; the only real excuse is that Congress has passed a series of short-term spending measures, with the real omnibus appropriations bill still being negotiated in advance of a pretty serious March 23 deadline. But the odds of Obamacare stabilization legislation making it into this package are definitely fading. For one thing, House Republicans are now demanding strict language prohibiting use of any Obamacare subsidy dollars for purchase of private insurance policies covering abortion services.

Last week, Sen. Patty Murray of Washington, a lead Democratic negotiator, called GOP demands on abortion limitations “a complete nonstarter.” A spokeswoman for Rep. Ryan Costello, R-Pa., sponsor of the House GOP package, said if Democrats want to oppose the effort “by playing abortion politics, then shame on them.”

The even bigger problem is that escalating demands — mostly from Republicans, some from Democrats — for “riders” on the giant appropriations measure could be leading to a dynamic in which virtually all of them — including Obamacare stabilization — are left out. In other words, health-care measures could become collateral damage in higher-profile fights over gun regulation, immigration, and Planned Parenthood “defunding.”

The really unfortunate thing about these developments is that Obamacare needs stabilizing a lot more than it did when Alexander and Murray unveiled their legislation last year. Since then, Congress has eliminated the individual mandate for health insurance, and the Trump administration has taken a number of steps to let states mess with the rules governing individual insurance policies. The most important of these is probably the encouragement of “short-term” policies that are allowed to evade all of Obamacare’s requirements, which could lead to an even greater exodus of young and healthy people from the Obamacare risk pool than abolition of the mandate.

Indeed, Senator Tammy Baldwin thinks this is such a big problem that enacting last year’s Obamacare stabilization bills won’t do much good without additional restraints on the new GOP-promoted loopholes:

Baldwin told TPM that if Congress re-funds the CSRs and passes a temporary reinsurance program but ignores the threat of the short-term plans, it would be like bailing out a sinking ship while failing to patch a hole in the hull….


“I think it will not only have the impact of basically allowing junk plans to be offered to sometimes unsuspecting people, but beyond that, it will drive up prices in the ACA marketplace because healthier people may go into the junk plans and leave older and less-well people in the ACA.”

So Baldwin is pushing her own measure overruling Trump’s permission slip for expansion of short-term plans.

About the only thing exerting significant leverage on Republicans to cooperate in Obamacare stabilization is the fear that they will get blamed for shockingly high premium increases for 2019, which would be announced shortly before the midterm elections, as the Associated Press notes:

Some Democrats think they’d reap political gains if the talks collapse since polls show the health care statute is widely popular and the public would largely fault Republicans if consumer costs spiral skyward.


“Either Republicans help stabilize the market or they own these premium and deductible increases,” said Rep. Kurt Schrader, D-Ore. “And I’d be glad to help crucify them if they don’t want to do something very reasonable.”


The effort forces Republicans to choose between trying to avert bad news about premiums shortly before elections or standing by their opposition to anything that could be viewed as propping up “Obamacare.”

In what is widely being perceived as a “base mobilization” election year, it’s a reasonably good bet that enough Republicans will refuse to do anything to prop up Obamacare and that this dilemma will be resolved in favor of inaction, particularly given all the cross pressures surrounding the omnibus appropriations bill. That might change with some seriously responsible Republican leadership. But expecting that from an endangered Speaker Paul Ryan or from the president who has done so much himself to destabilize Obamacare is likely naïve.

Hopes Fade That Congress Will Stabilize Obamacare