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Obamacare: A High Speed Train Wreck

August 19, 2013


On the August 14 “Morning Joe” show on MSNBC, a commentator and a congressman perpetuated the myth that Republicans in the House of Representatives have voted more than 40 times to repeal Obamacare. In fact, the House has made 37 votes related to Obamacare, but only a fraction of those votes pushed for a full-scale repeal of the law. Others instead made substantive changes to various aspects of the law.
 
“What we’ve done over 40 times in the House of Representatives is just vote to abolish the bill!” proclaimed Representative Gregory Meeks (D-NY) on “Morning Joe.” “We haven’t talked about problems and we haven’t talked about how we fix problems that may be there. The only thing we’ve talked about and the only votes that come in is to get rid of the bill!” (Remember when “Meet the Press’s” David Gregory criticized Senate Minority Leader Mitch McConnell (R-KY) for calling Obamacare a bill, instead of a law? Meeks called it a “bill” five times.)
 
Brian Shactman, one of the MSNBC commentators, agreed with Meeks, and said that “there are very few people at this table that would disagree that voting 40 times to repeal it doesn’t help anybody.”
 
But the Republicans haven’t voted 40 times to repeal Obamacare. Some votes were very targeted to improve on or defund certain segments of the law. In his Fact Checker articlelast month, Glenn Kessler of The Washington Post said that Senator Harry Reid’s (D-NV) claim, which was similar, “comes close to Three Pinocchios, but not quite.” He ended up giving him two Pinocchios. (Reid, by the way, along with Sen. Max Baucus (D-MT), called Obamacare, in its present form, a “train wreck.” Kessler didn’t rate Reid on that, but that was deserving of no Pinocchios.)
 
Kessler outlined at least eight votes (of the 37) that “were actually successful, in that the bills also passed the Senate and were signed into law by President Obama.” This refutes the assertion that Republicans haven’t sat down with Democrats to work on aspects of the law.
 
For example, the House initiated the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act, which repealed the Form 1099 reporting requirements that were used to help finance the health law. That was signed into law by President Obama, as was The Consolidated Appropriations Act of 2012, which “rescinded $400 million in CO-OP funds and $10 million in funds for the Independent Patient Advisory Board (IPAB),” cut the “IRS’s enforcement budget,” and “tightened restrictions on using federal Centers for Disease Control and Prevention grant money for lobbying purposes,” according to Kessler. These and other changes, according to the Post’s Sarah Kliff, have “changed the way income gets counted under the Affordable Care Act” and “cut off funding to a program that was meant to fund new, nonprofit health plans in all states.”
 
“These are actual changes to the Affordable Care Act which have not dismantled the law but have certainly affected what the final product will look like,” wrote Kliff back in May.
 
Rep. Meeks made a point similar to the one that President Obama made at his press conference on August 9th: “Why it is my friends in the other party have made it their mission to prevent these people from getting healthcare?” said Obama. “The idea that you would shut down the government unless 30 million people don’t get healthcare is a bad idea.” The problem with that is that according to the Congressional Budget Office (CBO), which is the generally agreed upon authority on these matters, after the first decade of Obamacare, there will still be 30 million people uninsured.
 
As insurance premiums have skyrocketed in most states, and more and more doctors have withdrawn from the system, it has become clear that the right to buy insurance is vastly different than being able to afford insurance, or having timely access to quality healthcare even with that insurance.
 
Regardless of one’s support for the law, the rollout of Obamacare has been plagued with many problems, prompting some to wonder whether the law will suffer death by a thousand cuts.
 
Shactmanasked on “Morning Joe,” “But these delays…three major ones, I believe. Is there an existential problem here?...Are we looking at…delaying it because we don’t have a solution?”
 
Two of these delays include the employer mandate, by a year, and, as recently revealed by The New York Times, the fact that the limits on out-of-pocket costs provision will be delayed by another year as well.
 
The latest in the saga—that the limits on out-of-pocket costs will be postponed—seems to be an attempt to avoid the skyrocketing premiums. “But the move will also help prevent more rate shocks,” writes Fox News. “Insurance premiums are set to rise precipitously next year as insurers are required to begin accepting patients with pre-existing conditions.”
 
“The grace period has been outlined on the Labor Department’s website since February, but was obscured in a maze of legal and bureaucratic language that went largely unnoticed,” reported The New York Times.“But federal officials said that many insurers and employers needed more time to comply because they used separate companies to help administer major medical coverage and drug benefits, with separate limits on out-of-pocket costs.”
 
Similarly, Mark Mazur, Assistant Secretary for Tax Policy, cited difficulties in the business community as the reason for delaying the employer mandate. “We have heard concerns about the complexity of the requirements and the need for more time to implement them effectively,” hewrote. The announcement was made right before the July 4th weekend. 
 
So, the first aforementioned change was buried in bureaucratic language and the second was announced when people were going on vacation. Do we notice a pattern?
 
Some analysts believe that the employer mandate was delayed by a year in order to move the inevitable cut to employment past the mid-term elections. “NBC News spoke with almost 20 small businesses and other entities from Maine to California, and almost all said that because of the new law they’d be cutting back hours for some employees—an unintended consequence of the new law,”reported NBC Newsthis week. “Congressional elections will take place in November of next year, and the delay [in the employer mandate] potentially shields Democratic candidates from a backlash generated by the additional regulations on employers,” reported Bloomberg last month.
 
Never mind that the President may not have the authority to do this much by executive fiat. “Tuesday’s revelation that the White House had granted a similar delay is confirmation that it knows, though will never publicly admit, that Obamacare is hopelessly flawed,” writes Investor’s Business Daily. “Well-constructed legislation does not need to be continuously ‘amended’ by executive fiat.”
 
Add to this the revelation that charitable hospitals will need to, under Obamacare, submit paperwork every three years establishing that there is “continuing need” for their non-profit status—as defined by the government. And, according to a new poll, 92.3% of federal workerswould like to stay with their current health plan; only 2.8% believe that they should be required to join the Obamacare exchanges.
 
With negative effects like these, it is not surprising that some Republicans and conservatives believe the law poses an existential threat large enough to justify the possibility of a government shutdown if it is not defunded. However, others in the GOP who also want to see Obamacare repealed are concerned that defunding won’t succeed, that Republicans would be blamed for shutting down the government, and would pay the price in the next elections. They are “undoubtedly against a shutdown and many of them are becoming more vocal about it.” CNN calls it “GOP’s Obamacare dilemma.” 
 
But it is not just Republicans who don’t like what they see of Obamacare. It is worth another look, or a first look if you missed it last month, at the letter from three top labor union leaders, including James Hoffa of the Teamsters. Here is a sampling from their letter, addressed to Sen. Harry Reid and Rep. Nancy Pelosi (D-CA), the top Democrat in both the Senate and the House:
 
“When you and the President sought our support for the Affordable Care Act (ACA), you pledged that if we liked the health plans we have now, we could keep them. Sadly, that promise is under threat. Right now, unless you and the Obama Administration enact an equitable fix, the ACA will shatter not only our hard-earned health benefits, but destroy the foundation of the 40 hour work week that is the backbone of the American middle class.”
 
“As you both know first-hand, our persuasive arguments have been disregarded and met with a stone wall by the White House and the pertinent agencies.”
 
“Time is running out: Congress wrote this law; we voted for you. We have a problem; you need to fix it. The unintended consequences of the ACA are severe. Perverse incentives are already creating nightmare scenarios.”
 
While the unions were “met with a stone wall,” Congress did receive an Obamacare waiver that is not sitting well with the folks back home. There are a lot of ways this fiasco can play out, and none of them are pretty.
Copyright ©2013

 


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