As Trump Threatens Obamacare, Bipartisan Group of House Members Plots a Fix

People protest the GOP effort to repeal and replace Obamacare in New York on July 29, 2017. Photo: Pacific Press/LightRocket via Getty Images

In the wake of the shocking failure of the Senate Republicans’ push to destroy Obamacare, over the weekend, President Trump revived his threat to make the individual health-insurance markets implode, tweeting “BAILOUTS for Insurance Companies and BAILOUTS for Members of Congress will end very soon!” (And calling for an end to the legislative filibuster, though that’s not why “skinny repeal” failed.)

On Fox News Sunday, White House adviser Kellyanne Conway said Trump hasn’t actually settled on whether he’ll end cost-sharing reduction (CSR) payments — Obamacare-mandated payments to health-insurance companies that reduce costs for low-income customers — but “He’s going to make that decision this week, and that’s a decision that only he can make.”

Meanwhile, a group of about 40 House Republicans and Democrats have been working on legislation that would protect the health-insurance industry from the whims of our notoriously mercurial commander-in-chief. The Problem Solvers caucus has been meeting quietly for the past few weeks to look at ways to stabilize Obamacare, and according to Politico, they plan to unveil their ideas on Monday.

Their most significant proposal is providing funding for CSR subsidies, which are expected to be $7 billion this year. The subsidies reimburse insurers for covering out-of-pocket costs like co-pays and deductibles for the lowest-income exchange enrollees. Earlier this year, the Kaiser Family Foundation concluded that eliminating the payments would cause premiums to increase an additional 19 percent. Since the federal government would have to pay more in tax credits that subsidize premiums for low-income exchange customers, eliminating CSR payments could actually cost the federal government an additional $2.3 billion in fiscal year 2018.

Trump only has control over the payments because the House sued the Obama administration in 2014, arguing that the payments required congressional approval. A federal-district-court judge ruled in favor of the House last year, but the president was allowed to continue making the payments as the matter worked its way through the courts. If Congress decided to fund the CSR payments in the meantime, the lawsuit would be a moot point.

According to Politico, members of the Problems Solvers and other centrist allies are considering a number of other changes to stabilize the marketplace:

The bipartisan working group also wants to change Obamacare’s employer mandate so that it applies only to companies with more than 500 workers. Currently companies with at least 50 workers can be hit with a tax penalty if they don’t provide coverage to their workers.

The group also wants to create a federal stability fund — dollar amount unspecified — that states can tap to reduce premiums and other costs for people with extremely expensive medical needs. Both the Senate and House repeal packages contained similar pots of money.

The bipartisan proposal also calls for scrapping Obamacare’s medical-device tax, an idea that has received bipartisan support in the past.

Finally, the working group is seeking greater flexibility for state innovation. Obamacare already allows state to seek waivers from coverage rules, but the lawmakers want additional guidance on how states can take advantage of them.

Presumably, many Republican lawmakers will find this more appealing than Trump’s plan to let their constituents suffer as he sabotages the health-care system (particularly in an election year). While Obamacare is far from a “complete disaster,” as Trump is fond of saying, about 25,000 people in 38 counties are at risk of having no insurer participating in their exchange in 2018.

Even if the House is able to reach a bipartisan agreement on shoring up Obamacare, it’s not clear how it would fare in the Senate. On Friday, Democratic senator Bill Nelson said he’s working with Republican senator Susan Collins and others on a health-care fix.

“This group of senators met for dinner the other night to start sharing our ideas and discussing a path forward. While we still have a long way to go, we are starting to work together to try to get this done in a bipartisan way,” Nelson said on Friday.

While Senate Majority Leader Mitch McConnell challenged Democrats to come up with their own health-care agreement after his bill failed early on Friday morning, he mentioned in the same breath that he and many of his Republican colleagues would not be up for “bailing out insurance companies.”

Time is not on the Problems Solvers’ side either. The Senate will only be in session for another week before going on recess, and without clear guidance from Trump or Congress on whether CSR payments will continue, insurers may pull out of the marketplace or jack up rates by the August 16 deadline for premium prices.

Bipartisan Group of House Members Plots Obamacare Fix