Saturday, July 29, 2017

Now Trump May Try to Kill Obamacare Slowly

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Obamacare survived another day after Senate Republicans failed to repeal the health law in a dramatic overnight vote. The White House could now try to kill it slowly.

The surprise defection by Senator John McCain, who with fellow Republicans Lisa Murkowski and Susan Collins joined with Democrats to oppose the GOP “skinny repeal” bill early Friday morning, leaves Obamacare as the law of the land. But President Donald Trump, who’s supported a repeal all along, wasted no time to threaten to sabotage Obamacare.

“3 Republicans and 48 Democrats let the American people down,” the president tweeted at 2:25 a.m. Friday. “As I said from the beginning, let Obamacare implode, then deal. Watch!”

There are two key ways the President of the U.S. could undermine the law: asking his agencies not to enforce the individual mandate created under Obamacare; and stopping funds for subsidies that help insurers offset health-care costs for low-income Americans. Both moves could further disrupt the Affordable Care Act’s individual markets and eventually lead to higher premiums -- and angry constituents.

Uncertain Fate

But in the aftermath of the massive setback for a party that vowed to repeal Obamacare for seven years, as the finger-pointing starts for who’s to blame, the law’s fate remains as uncertain as ever. The GOP could try once again to revive its repeal efforts, while Democrats called for a bipartisan debate on how to fix the law.

Trump’s Health and Human Resources Secretary Tom Price took a conciliatory tone after the scaled-down repeal bill was rejected Friday. The administration is committed to improving the system, lowering costs and creating an environment “where Washington’s interests take a backseat to patients’ needs,” Price said in a statement.

“Since day one of the Trump Administration, the team at HHS has taken numerous steps to provide relief to Americans who are reeling from the status quo, and this effort will continue,” Price said.

Where does this leave Trump’s implosion threat? One of the first steps the president could take would be to stop the monthly payments to insurers known as cost-sharing-reduction subsidies. The administration last made a payment about a week ago for the previous 30 days, but hasn’t made a long-term commitment. Trump has called the subsidies a “bailout” for insurance companies in the past.

“We are still considering our options,” Ninio Fetalvo, a spokesman for Trump, said in an e-mail.

Rising Premiums

America’s Health Insurance Plans, a lobby group for the industry, said premiums would rise by about 20 percent if the payments aren’t made. Many insurers have already dropped out of Obamacare markets in the face of mounting losses and blamed the uncertainty over the future of the cost-sharing subsidies and the individual mandate as one of the reasons behind this year’s hikes in premium.

Anthem Inc., until recently one of the last Obamacare stalwarts among big insurers, said earlier this week that its exit from more marketplaces could be hastened if the industry doesn’t get clarity on the payments. Smaller health plans wrote lawmakers Thursday stressing the importance of the subsidies and policies that would encourage more healthy people to buy insurance and spread the risk.

“If certainty is not brought to the market and policymakers in Washington fail to establish stabilization measures, consumers face the prospect of significantly higher costs,” Ceci Connolly, chief executive officer of the Alliance of Community Health Plans, wrote.

Another way Trump could hamper the ACA is to instruct Price’s department to direct little or no support to open enrollment when people sign up for Obamacare plans near the end of the year. It could include ignoring website upkeep, not advertising the enrollment period and offering little help for people who have difficulty signing up.

QuickTake: The Individual Mandate

As for the individual mandate, the least popular part of the ACA, the Trump administration could choose not to enforce the penalties for uninsured people or broaden exemptions to the law that currently excuse those who show a hardship prevented them from having coverage. The Internal Revenue Service, which enforces the penalty, said in January it would no longer reject filings if taxpayers didn’t indicate whether they had insurance. Unless the IRS follows up with each silent filing, this could let some uninsured people dodge the penalty.

All the moves would have an impact over time. For now, only one thing is certain: nothing is certain. As Larry Levitt, senior vice president of the Kaiser Family Foundation, puts it in a series of tweets:

“The big question in health care now is what will happen with the individual insurance market,” Levitt said. “Insurers will be reading all the tea leaves for what the administration will do with cost-sharing payments and the individual mandate.”

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