There is no doubt that ObamaCare has lived up to the prediction it would be a “train wreck.” This was the assessment of Democratic Senator Max Baucus (D- Montana), then Chairman of Senate Finance Committee, speaking to Health and Human Services Secretary Kathleen Sebellius on 4/17/13. But Democrats didn’t listen to his warning and implemented the Affordable Care Act in 2014.
Democrats are determined to throw good money after bad by extending temporary government subsidies another three years and eventually making them permanent. Rather than fix the problem they made, they want to use the issue as a cudgel to force Republicans into prolonging the misery lest they be accused of taking away people’s healthcare.
The real solution to a bad policy is to make a good policy. Republicans have been reluctant to take on this task in the wake of their failure during the first Trump administration thanks to rogue Republican Senator John McCain. But the adults in the room have to take leadership at some point and improve or discard this failed healthcare system.
Fortunately, there is some reason for optimism as Republican leadership is now showing interest in improving ObamaCare. This won’t be pretty as Republicans face complete opposition from any Democrats and even a few Republicans. Expect this debate to continue throughout the coming year.
The Wall Street Journal editorial board says, “The GOP bill would make it easier for small businesses to escape the ObamaCare regulatory morass. The bill would expand so-called association health plans that let small employers unite to sponsor group health plans. These plans would reduce premiums by expanding risk pools and give small employers more leverage with insurers.
The plans wouldn’t have to adhere to many costly ObamaCare rules, though they still couldn’t charge more for workers with pre-existing health conditions. Worker premiums for association plans would likely be lower than for ObamaCare plans. Workers might also see an increase in take-home pay if their employer’s insurance costs fall.”
The Republican bill also seeks to reduce ObamaCare premiums by fixing a distortion caused by the law’s convoluted design. ObamaCare requires insurers to reduce deductibles and co-pays for low-income enrollees in benchmark silver plans. No surprise, insurers have raised premiums for these silver plans to offset the cost of these “cost-sharing” reductions.
Because ObamaCare subsidies are pegged to premiums for silver plans, the cost-sharing mandate has resulted in larger subsidies for all plans. The GOP bill would appropriate funds to insurers to pay for ObamaCare’s required cost-sharing reductions. This would reduce premiums for silver plans and, in turn, taxpayer spending on subsidies. A better solution would be to eliminate the cost-sharing mandate, which can make ObamaCare plans more attractive than employer plans for lower-income enrollees.
The Census Bureau’s annual survey of insurance coverage this year showed that the share of Americans with any coverage hasn’t changed since 2019 despite the larger ObamaCare subsidies. Enrollment in employer plans has declined but government and ObamaCare coverage has increased. This trend is exactly what Democrats want as they seek to eventually have all Americans on government-controlled health insurance. This is socialized medicine by another name.
Some of the increase in ObamaCare enrollment owes to fraud, as the Paragon Health Institute has documented and the Government Accountability Office recently corroborated. Millions of people have under-reported their incomes to qualify for bigger subsidies, while brokers enroll people in plans without their knowledge to earn bigger commissions.
The GOP may not succeed anytime soon in reversing the damage of ObamaCare, but it is important they show the American people which party is really looking out for what’s best for their healthcare.
