After claiming that there was no Plan B if they didn’t pass Obamacare repeal last Friday, it is becoming obvious that Republicans had a Plan B all along. In fact, Plan B might have been their Plan A. Let me explain.
When the ACA repeal bill failed, Paul Ryan immediately said that “Obamacare is the law of the land” and “we’re going to be living with Obamacare for the foreseeable future”. Why would he say things like that? Do you think he would give up that easily? Of course not.
My guess is that the plan all along was to pretend to try to repeal Obamacare to make the base happy, but have the repeal fail. Then (as I’ve said before) quietly sabotage the ACA so that it fails. That allows them to try to blame its failure on the Democrats.
And today, we learned more about that strategy when Secretary of Health and Human Services Tom Price testified in front of Congress, and made it clear that he has the power to kill Obamacare. He can do this partially by just refusing to enforce some of the provisions of the law, most importantly the individual mandate, which would drive up costs tremendously. And partially by taking advantage of leeway written into the law, such as eliminating most if not all of the “essential benefits” or reducing cost-sharing subsidies. Reducing the subsidies alone will bring “significant premium increases” for consumers. “Some insurers will drop out, and the remaining insurers will have to seek large rate increases.”
In fact, just by saying that he might do these things introduces uncertainty in the market, which will encourage insurance companies to drop out of the Obamacare marketplaces. The CEO of one major health insurance company said that the cost-sharing subsidies are a major uncertainty hanging over his company’s ability to participate in the marketplaces going forward. Another uncertainty is enforcement of the individual mandate.
Price claims that he will will be doing these things in order to “dramatically lower the cost of insurance for Americans”. And indeed, if Price eliminates the “essential benefits” then insurance companies will be able to offer extremely cheap insurance policies, but those policies will cover almost nothing. The essential benefits that Price can possibly eliminate include emergency room services, hospitalization, maternity and newborn care, prescription drugs, laboratory services, mental health and substance abuse services, chronic disease management, vision care, and even preventative care. What’s left?
Allowing people to buy plans that do not include (for example) maternity care means that the cost of plans that do include maternity will skyrocket, because only people who plan to have babies will buy such plans, and insurance companies are not about to just absorb those costs.
Can we do anything to prevent this from happening? Most importantly, we need to make sure that Secretary Price cannot do these things without anyone noticing, and then blame Obamacare when premiums go up or insurance markets collapse.
Also published on Medium.