Republicans Aim a Big Gun at Their Foot

Ask business people what they try to achieve in their planning and they will frequently talk about “certainty.”  They seek to know how much tax they will have to pay, what regulations they will have to endure, how stable their markets will be, etc.  With this information they can set prices and more accurately estimate their return on investment.  Insurance companies are no exception.

For over eight years, however, Republicans in Congress have chipped away at the Affordable Care Act in ways that eliminated certainty in the Obamacare market places.  During the 2016 presidential primary campaign, Sen. Marco Rubio (R-Fl.) even bragged that a provision he inserted in a spending bill would “kill” Obamacare.  This constant weakening of the law made it difficult for insurers to price their products and no doubt caused premiums to be higher.  The uncertainty also discouraged many insurers from even participating in the insurance exchanges, which lessened competition and increased premiums.

President Trump and congressional Republicans made an all-out effort to repeal and replace Obamacare in 2017.  It was their number one legislative priority, even before cutting taxes.  The draconian proposals they put to a vote, however, failed spectacularly and the effort collapsed when former Sen. John McCain dramatically turned thumbs down on their last gasp attempt in the Senate.

Undeterred by this failure, 20 Republican-controlled states filed suit in federal district court in Texas early last year seeking to invalidate Obamacare.  They claimed that the law was rendered unconstitutional because the 2017 GOP tax law eliminated the fine for not having health insurance.  Last December the conservative judge in that court agreed with their argument.

Sixteen, mostly Democrat-controlled, states and the District of Columbia appealed that decision to the 5th Circuit Court of Appeals in New Orleans.   Initially, the U.S. Justice Department argued that only the provision of Obamacare that protected people with preexisting conditions was unconstitutional.  Last month, however, Trump ordered the DOJ to join the plaintiffs in seeking to strike down the entire law.

Concurrently, Trump encouraged several Republican Senators to begin crafting a “wonderful health care [replacement] package” and claimed that the GOP would become “the party of great health care.”  After Senate Majority Leader Mitch McConnell informed him that health care legislation would not be brought up this year or next, the president promised it would be done soon after he was reelected in 2020.

On Tuesday, the DOJ asked the 5th Circuit for an expedited hearing on the Obamacare matter, with oral arguments to occur in early July.  This court is probably the most conservative appeals court in the nation, so the lower court decision might be upheld.  Either way, it seems likely the issue will go to the Supreme Court for a final decision, perhaps next year in the spring.

But here’s the thing.  If the entire Affordable Care Act is held to be unconstitutional, Republicans seeking reelection in 2020 will be facing a disastrous political problem.  Around 20 million Americans would lose their health care insurance; the opioid crisis, which studies show has been moderated by the Obamacare Medicaid expansion, would get worse; people with pre-existing conditions would be priced out of the market; and more hospitals in rural Trump territory would have to close.

Why? Well, the GOP has no good alternative plan for Obamacare — or for folks with pre-existing conditions.  Republicans in the U.S. House, have been proposing huge cuts to Medicare and Medicaid since 2011.  Even Trump’s recent budget called for cutting $241 billion from Medicaid funding over the next decade.  Yet, I don’t think most voters realize the damage these Republican policies would precipitate, even for many in the upper middleclass.  Here’s just one example.

A New York Times article last month entitled “Nursing Homes Are Closing Across Rural America, Scattering Residents,” chronicled how patients are being relocated far from loved ones.  Frequently the reason is financial.  Medicaid funding provides a substantial amount of nursing home revenue, with estimates I’ve read as high as 60 percent.  Conservative South Dakota — which was featured in this report — provides the lowest level of Medicaid support in the nation for its elderly citizens needing skilled nursing care.  “Five South Dakota nursing homes have shut down in the past three years, and dozens more are losing money because the majority of their residents rely on Medicaid,” according to author Jack Healy.

Costs vary from state to state but $6,000 to $8,000 per month is probably a conservative cost range for a nursing home patient.  How many higher level middleclass families can afford that type of financial burden if a parent can’t?  And Alzheimer’s patients can need this type of care for many years.

There were over 1.3 million patients in nursing homes in 2016, according to the Kaiser Family Foundation.   Almost half a million were in the 20 states seeking to invalidate Obamacare.  Six of these states are in the top 10 that are most dependent on Medicaid and other federal funding, according to the personal finance website WalletHub and half are in the top 20 most dependent.

Congressional Republicans who are up for reelection in 2020 are no doubt praying Obamacare survives this constitutional challenge by their state colleagues.  For if it’s struck down, they will finally be forced to defend what they have been trying to achieve for almost a decade — and they will be crushed at the polls.

 

 

About eeldav

I am a retired corporate attorney who has lived in both Europe and Asia. While working my responsibilities took me to over 40 countries in Europe, the Middle East, Africa and Asia.
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2 Responses to Republicans Aim a Big Gun at Their Foot

  1. H. David Bashkin says:

    You are optimistic. Trump’s base will vote for him even while he cuts their throat while they make their way to the polling and vote for him with their last drop of blood. He and his base have invalidated Adam Smith.

    Incidentally, prices in senior residences are rising rapidly. Medicine is going through the roof. I understand that insulin price is the latest to rise dramatically, because the producers claim they must fund “research”.

    David

    Like

  2. Michael Arrowood says:

    The biggest scandal in health care today is how the Affordable Care Act is being opposed by partisan fanatics, while opponents don’t even bother to come up with a reasonable alternative before they destroy. Hard to believe Trump’s rural base will hang with him on this one, but they’ve believed all of his propaganda so far, thus I don’t think it’s beyond possibility.

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