Healthcare subsidies divide GOP
Repeal of Obamacare poses a fundamental question: whether to retain coverage for millions of Americans.
WASHINGTON — Quizzed about the fate of millions of Americans who depend on the Affordable Care Act and its insurance protections, President Trump invariably offers bold but vague assurances.
“I want to take care of everybody,” he said in an interview with ABC News this week, a pledge GOP lawmakers and Trump’s nominee for Health secretary have echoed in recent weeks.
But as Republicans scramble for a strategy to repeal and replace the healthcare law, they are reckoning with a fundamental question the party has never settled: whether to foot the multitrillion-dollar bill to ensure millions of Americans retain the coverage they obtained under Obamacare.
GOP lawmakers for years ducked that issue as they unified behind cries to roll back the program, but were assured President Obama would block them. Now, the power to actually repeal and replace the law is exposing deep divisions in the party.
On one side, fiscal conservatives, many of whom never wanted to expand government-subsidized coverage in the first place, insist Congress must dramatically cut healthcare spending. This wing of the party is concentrated in the House.
On the other side, some GOP governors and senators argue Republicans must protect coverage for vulnerable Americans. Many are worried about a political backlash if millions of Americans lose health insurance.
“It’s going to get really ugly on the Republican side,” predicted one former GOP congressional aide, who asked not to be identified discussing tensions within his party.
At stake is coverage not only for Americans who use insurance marketplaces created by Obamacare, but also for tens of millions more who rely on safety-net programs such as Medicaid and Medicare, which many Republicans — including several slated for senior posts in the Trump administration — have long targeted for cuts.
The 2010 healthcare law has extended coverage to more than 20 million previously uninsured Americans, driving the nation’s uninsured rate to its lowest level.
At the same time, the law’s financial aid and consumer protections — including bans on annual and lifetime benefit limits and guaranteed coverage, even for people who are sick — have eased financial pressure on many households, even though high premiums continue to vex some.
The share of adults who skipped care because of costs dropped by nearly onefifth from 2013 to 2015, according to a recent report from the nonprofit Commonwealth Fund.
But the new protections aren’t cheap. Over the next decade, the price tag for the healthcare law is expected to reach nearly $2 trillion, the Congressional Budget Office projects. That amount, which reflects the astronomical cost of medical care in the U.S., is offset with a mix of taxes and other spending cuts.
But many conservative Republicans — including Trump’s pick for Health and Human Services secretary, Rep. Tom Price (R-Ga.) — say the Obamacare spending, on top of trillions of dollars that Medicaid and Medicare already cost the government, is unsustainable.
“The health and retirement security of millions of Americans is in jeopardy,” Price warned in his 2017 budget blueprint. Price, an original member of the tea party caucus and a leading advocate for slashing federal healthcare spending, crafted the budget in his role as chairman of the budget committee.
His budget, which is modeled on a similar program developed by House Speaker Paul D. Ryan (R-Wis.), would repeal Obamacare and the subsidies it provides to nearly 10 million low- and moderate-income Americans to help them buy health insurance.
The budget also would cut federal Medicaid spending by close to 40% over the next decade, leaving states with some $2 trillion less in federal aid to run their safety-net programs. Medicaid provides coverage to about 70 million poor Americans, including children, the disabled and the elderly.
Price and other fiscal conservatives say that with new flexibility to redesign their healthcare programs, states will fashion less costly ways for Americans to get health insurance.
But even some conservatives acknowledge eliminating that much aid will inevitably force millions to lose coverage because healthcare remains too expensive for most low- and moderateincome Americans to afford without assistance.
“The fact is we have a considerable number of people in the party who aren’t that interested in covering the uninsured,” said John Goodman, a health economist who has been working with a group of GOP lawmakers on an alternative to Obamacare that would preserve the law’s financial aid.
Preserving that assistance is gaining support among Republican elected officials, who now face the prospect that millions of their constituents suddenly could become uninsured if Obamacare is fully rolled back without a viable alternative.
Over the last several weeks, GOP governors whose states have expanded their Medicaid programs through the law — including Arizona, Michigan, Nevada, Ohio and Massachusetts — have voiced opposition to federal Medicaid cuts.
And Tuesday, the bipartisan National Governors Assn. sent a letter to House Republicans warning against any healthcare proposals that would saddle states with a greater share of Medicaid costs.
At the same time, a new Obamacare alternative that would largely retain funding in the current law and give states the option to maintain Obamacare’s coverage system or design something else is gaining support in the Senate.
The legislation, written by Sens. Bill Cassidy (R-La.) and Susan Collins (RMaine), now has the backing of Sens. Shelley Moore Capito (R-W.Va.), Johnny Isakson (R-Ga.) and Lindsey Graham (R-S.C.).
“We hope that our approach will expand the number of people who are covered,” Collins told CNN this week.
The GOP interest in preserving coverage reflects public opinion.
Though Obamacare remains deeply divisive, many of its key provisions are popular, even among Trump supporters.
Eight in 10 Americans in a recent Kaiser Family Foundation poll support federal aid to states to help them expand Medicaid coverage for the poor. A similar majority back the law’s system of insurance marketplaces — such as HealthCare.gov — in which people who don’t get coverage through an employer can shop for health plans and get subsidies to offset their premiums.
At the same time, a growing share of Americans say the federal government has a responsibility to ensure that all Americans have healthcare coverage. Six in 10 backed this view in a recent survey by the Pew Research Center, up from 42% in 2013.
The rise in support has been particularly pronounced among low- and middle-income Republicans, Pew found.
But the divides within the GOP remain deep.
Conservative lawmakers, such as Sen. Rand Paul (R-Ky.), are still demanding Obamacare’s taxes be rolled back, which would make it virtually impossible to maintain coverage.
And the Cassidy and Collins health plan has received a cool reception from some conservatives.
“The Patient Freedom Act, as introduced, replaces Obamacare with ... Obamacare,” Jason Pye, director of public policy at the advocacy group FreedomWorks, said in a blog post this week. “If Republicans are serious about repealing Obamacare, they, you know, actually have to do it. Introducing a bill that effectively preserves Obamacare does nothing to further this effort.”
For his part, Trump hasn’t weighed in on the debate within his party. But he continues to offer sweeping promises.
“We’re going to have a much better health plan at much less money,” the president told ABC News on Wednesday. “We will unleash something that’s going to be terrific.”