Republicans Didn’t Expand Obamacare

Drudge headline

Since when is repealing an Obamacare mandate met with such criticism from the Right?  This is the question I have been asking since last week’s passage of the Protecting Access to Medicare Act of 2014 led to a Drudge Report headline implying Republican collusion to “improve” the fatally flawed law.

The Obamacare mandate at issue was a cap on the deductibles for small employer group health plans offered in and out of the SHOP exchange. The SHOP exchange is the Obamacare exchange for small employers and, inexplicably, congressional staff.

PPACA Section 1302(c):

(2) ANNUAL LIMITATION ON DEDUCTIBLES FOR EMPLOYER-SPONSORED PLANS.—

(A) IN GENERAL.—In the case of a health plan offered in the small group market, the deductible under the plan shall not exceed—

(i) $2,000 in the case of a plan covering a single individual; and

(ii) $4,000 in the case of any other plan.

As with so many Obamacare provisions, this mandate was poorly conceived.  For one, it was essentially impossible for a Bronze plan to comply because of other competing mandates to cover essential health benefits and conform the actuarial value to the required 60% of medical expenses covered by the plan.  A study by HealthPocket found that 96% of Bronze plans in the SHOP exchange have deductibles exceeding the $2,000/$4,000 cap.

How is that possible?  HHS essentially waived the requirement, of course.  Here’s what ended up in the HHS final regulation (45 CFR Section 156.130(b)(3)):

(3) A health plan’s annual deductible may exceed the annual deductible limit if that plan may not reasonably reach the actuarial value of a given level of coverage as defined in § 156.140 of this subpart without exceeding the annual deductible limit.

In other words, the mandate was already gutted through the executive branch.  Congress should continue to assert its legislative authority by (at an absolute bare minimum) demanding that these endless delays and waivers be reflected in legislation.

Let’s also remember what the alternative to Obamacare will need to champion: consumer-driven healthcare.  High deductibles promote consumerism, particularly when paired with tax-advantaged accounts like an FSA, HRA, or (most importantly) HSA.  The problem with Obamacare, of course, is that it mostly pairs high deductibles with high premiums.  That doesn’t promote consumerism, that promotes bankruptcy.

Let’s also remember how we ended up with such a stupid mandate: Former Sen. Olympia Snowe (R-ME).  Good riddance.  According to the AP report linked by Drudge:

Democrats said the now-defunct limitation was inserted into the original law in an unsuccessful attempt to win the vote of former Republican Sen. Olympia Snowe of Maine. She supported the bill in the Senate Finance Committee but opposed it on the Senate floor.

In the end, the Republicans did a terrible job as usual of controlling the message.  Instead of taking a victory lap, spiking the football, or dunking the football over the crossbar, the Republicans initially sat on their hands and let Harry Reid claim victory.   Rep. Phil Roe (R-TN) was quoted in the same AP story stating: “Maybe you say it helps (Obamacare), but it really helps the small businessman.”

Maybe I say that we need to be a lot more persuasive than that.  For example: “Full repeal is the only approach.  Although full repeal is not currently feasible, we’re going to continue to work tirelessly to convince Democrats to join us in our efforts repeal every Obamacare mandate.”

Senate Majority Leader Reid, on the other hand, got to make the pitch that this actually is a win for the Democrats:

Asked if the legislation strengthened the law, Senate Majority Leader Harry Reid, D-Nev., said, “I would hope so. I believe that” it does. He added, “So there are changes being made. But the Republicans have to get over if they hate ‘Obamacare’ and are going to repeal it,” he added.

So now we’re letting Democrats make unchallenged statements that REPEALING an Obamacare mandate makes it better?  Isn’t this the same Harry Reid who is constantly complaining about the number of times the House Republicans have attempted to repeal provisions of Obamacare?

This is a rare case where Speaker Boehner’s office was basically on point, even if it was too little and too late.  In a post by his communications director Kevin Smith on Sunday titled “Republicans Successfully Chip Away Another Piece of ObamaCare,” Smith stated: “Successfully repealing this ObamaCare provision is just one part of Republicans’ larger effort to repeal the full law and replace it with better solutions focused on lowering healthcare costs for families and small businesses.”

Sounds good.  Now spread the message far and wide, build support, then actually execute.


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