Sunday, June 21, 2015

Republicans to blame for the ensuing health care fiasco if subsidies go away. Remember, this isn't even a full repeal.

Let's get something straight; Republicans have offered a number of very sketchy health care plans...forgettable plans that would scare the daylights out of every American, especially the tea party kind. 

Republicans would do almost all of the same things the Affordable Care Act does, but without a logical framework, that would still dole out taxpayer subsidies without all the reform. They've even seriously considered doing away with the employer write off for health care, putting everyone in the individual market. That would drop everybody's doctor and favorite health care plan, a complaint Republicans love to play up. The thing is, people just don't know about these things.

And while Republicans will try to keep the focus on the 4 word mistake in the original ACA law, they should be held responsible for whatever happens after the decision. They're in charge, and they have to have a plan that doesn't fail miserably and bankrupt families or let people die.

Forbes contributor Robert Laszewski wrote a great piece detailing what would happen under the new Republican plan if the tax subsidies die via the Supreme Court. To sum it up, the Republicans are in big trouble:
Republican Proposals To Extend Obamacare Subsidies Would Create Big Problems: Republicans  argue consumers shouldn’t worry because the Obamacare subsidies cap the cost a consumer would pay for subsidized coverage based upon their income—big rate increases won’t lead to higher consumer prices for those subsidized.

That would be true but what Republicans also need to appreciate is that about half of those who buy individual health insurance do so off-exchange, people who buy direct from their insurance company or through an insurance agent. That means there are about seven million people in the off exchange market in these 34 states that are not now eligible for subsidies.

These off-exchange people would be hit by very large rate increases under Sen. Ron Johnson’s plan beginning as soon as January 1, 2016 should the Court find for those trying to end the Obamacare subsidies. Senator Johnson’s plan just creates a closed block of health insurance business subject to dramatic high claim cost anti-selection and much higher prices for consumers would be the result. Higher prices that millions of higher income people (disproportionately Republicans?) in the individual market would have to pay out of their pockets.
Republicans want to Block Grant everything...so the states can screw everything up, make getting coverage as difficult as hell, without the federal government coming to the rescue:
Starting in 2016, states would be allowed to opt out of Obamacare and its regulations. States would receive a block grant for the same amount of subsidy money that their residents would have received under Obamacare to implement their own state-run health insurance system.
States can even Opt out of Block Grants, ignoring the health care problem completely:
The House proposal outline only says that for states that opt-out of Obamacare block grants would be available for the same amount of money as the state is receiving today. 

It is also not clear how a state, could possibly opt out of Obamacare and build the needed infrastructure to manage the subsidy money in time for providing coverage to its citizens on January 1, 2016 ... it did take the states at least two years and hundreds of millions of dollars to construct the means for people to buy health insurance and be subsidized for it under Obamacare. I have no earthly idea how a state might opt out and build a brand new health insurance system in just a few months—and do it for what might only be two years!

Both the House and Senate proposals are also made problematic by their insistence that the individual mandate be dropped but health insurance companies would continue to be required to take all comers no matter what their health conditions.

What we so far know about these proposals is clearly unworkable in the market and would lead to very big and unfortunate unintended consequences.

Of course, all of this misses the elephant in the room: These Republican proposals are so full of problematic elements that President Obama would have no trouble vetoing anything like this ... Leaving millions of people in the individual health insurance market in these 34 states, rich and poor, hanging.

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