Hill Democrats Aren’t Prepping for Potential ‘Policy Armageddon’

They are confident the Supreme Court won’t strike down Obamacare subsidies.

WASHINGTON, DC - JULY 15: Senate Majority Leader Harry Reid (D-NV) speaks at a press conference following the weekly Democratic policy luncheon July 15, 2014 at the U.S. Capitol in Washington, DC. Reid spoke on immigration and women's rights issues during his remarks. (Photo by Win McNamee/Getty Images)
National Journal
May 17, 2015, 4 p.m.

A month be­fore the Su­preme Court is ex­pec­ted to rule on the fu­ture of fed­er­al health care ex­changes un­der the Af­ford­able Care Act, Hill Demo­crats have taken a uni­form policy stance: They are not ready to talk pub­licly about po­ten­tial fixes in case the court rul­ing doesn’t go their way.

Brought by con­ser­vat­ive op­pon­ents of Obama­care, the court case, King v. Bur­well, will de­term­ine wheth­er sub­sidies offered on fed­er­al ex­changes un­der the Af­ford­able Care Act are leg­al. If the plaintiffs win, as many as 8 mil­lion people could lose the law’s tax sub­sidies.

“I don’t think they will [win],” Sen­ate Minor­ity Lead­er Harry Re­id said in a re­cent in­ter­view. “If they do, that’s a prob­lem that the Re­pub­lic­ans have.”

Oth­er mem­bers of his party, it seems, couldn’t agree more.

“It’s not that we won’t” come up with a plan, Sen. Debbie Stabenow said. “It’s just that we are hope­ful that the Court won’t rule in a way that in­creases taxes on mil­lions of work­ing people, which is what that would do, and Re­pub­lic­ans are the ones who re­pealed the Af­ford­able Care Act so the ques­tion is, where’s their re­place­ment?

“They are the ones who re­pealed it, they are the ones that need to re­place it,” she ad­ded.

“I sin­cerely be­lieve that the Su­preme Court is go­ing to up­hold that, so I’ve giv­en some thought to al­tern­at­ives but I’m not really pre­pared to talk about them un­til we know the out­come,” Sen. Richard Blu­menth­al said. “If the Court rules ad­versely, which I sin­cerely be­lieve it will not do, then we’ll have to con­sider some al­tern­at­ives, and ob­vi­ously we’re at least en­ter­tain­ing that pos­sib­il­ity.”

And Sen. Bob Ca­sey: “I’m hop­ing the Court will rule the right way, which would be up­hold the law.”

But if it doesn’t, some Demo­crats ad­mit things will get ugly.

“If the plaintiffs win, it’s policy Armaged­don,” Sen. Chris Murphy said in an in­ter­view.

“There’s no way this place has the ca­pa­city to fix the health care law in the wake of that de­cision,” he ad­ded. “I think there might be a couple state le­gis­latures that could do something, but this place can’t put one foot in front of the oth­er with health care policy in a bi­par­tis­an way. I think it’s cata­stroph­ic if King gets de­cided the wrong way.”

Mul­tiple Re­pub­lic­an pro­pos­als have been put for­ward to ad­dress a pre­sumptive court de­cision elim­in­at­ing sub­sidies in all fed­er­al ex­changes.

One bill, from Sen. Ben Sas­se, would al­low Obama­care en­rollees to keep their in­sur­ance and con­tin­ue re­ceiv­ing as­sist­ance for 18 months after the rul­ing. The De­part­ment of Health and Hu­man Ser­vices would also be banned from rent­ing or selling Health­Care.gov‘s tech­no­logy to states.

Sen. Ron John­son’s bill would al­low in­di­vidu­als to keep any health care plan and sub­sidy un­til Au­gust 2017. It also would re­peal the in­di­vidu­al and em­ploy­er man­dates, and amend es­sen­tial health be­ne­fits and be­ne­fit pack­ages to those defined by the state in which the health plan is offered.

Sas­se’s bill does not have any co­spon­sors. John­son’s has 31, in­clud­ing Ma­jor­ity Lead­er Mitch Mc­Con­nell and Sens. John Bar­rasso, Lind­sey Gra­ham, and Or­rin Hatch.

But it’s not ex­actly a bi­par­tis­an group, as Murphy poin­ted out: “How many of those 31 would sup­port the re­peal of the Af­ford­able Care Act? Prob­ably 31.”

“Ob­vi­ously there are ways to fix it,” Murphy said said. “Re­pub­lic­ans haven’t giv­en us any­thing that I would con­sider to be even a plat­form for dis­cus­sion at this point. I think for us to come up with solu­tions … at this point doesn’t make a lot of sense. And plus, the Su­preme Court’s go­ing to do the right thing.”

Just as Demo­crats be­lieve the court will go their way, Re­pub­lic­an sen­at­ors are con­fid­ent the justices should side with the chal­lengers. And John­son, at least, be­lieves his plan is “reas­on­able” enough that Demo­crats might ac­tu­ally go for it.

“I would hope they’d be reas­on­able from a stand­point that their slop­pily writ­ten law—and then if the Court rules that way, their un­law­fully im­ple­men­ted law—cre­ated a big mess, which we’d be help­ing them to get out of, and then all I’d be ask­ing for is a little free­dom for the Amer­ic­an pub­lic. I think that would ac­tu­ally be a pretty good pro­pos­al,” John­son said in an in­ter­view.

At Na­tion­al Journ­al‘s re­quest, Murphy re­viewed John­son’s bill. He dis­agrees on its reas­on­able­ness.

“There’s not a single Demo­crat that would sup­port what John­son is pro­pos­ing, I would hope. About 5 per­cent of his bill is ded­ic­ated to King v. Bur­well. The oth­er 95 per­cent is ded­ic­ated to re­peal­ing the Af­ford­able Care Act,” he said.

Sas­se’s bill, mean­while, is “about as valu­able as the pa­per it’s writ­ten on,” Murphy said.

Sen. Bernie Sanders, the Ver­mont in­de­pend­ent who is seek­ing the Demo­crat­ic pres­id­en­tial nom­in­a­tion, said he hasn’t looked at any of the GOP bills. Asked about those meas­ures, he re­spon­ded, “Well, Re­pub­lic­ans have put out a budget that would throw 17 mil­lion people off of health in­sur­ance.”

Re­gard­less of party, there seems to be a con­sensus with­in the Sen­ate that a King win will cre­ate a gi­ant mess. And up un­til now, when it comes to Obama­care, bi­par­tis­an­ship isn’t something Con­gress has been very good at.

“There’s al­ways room to work to­geth­er if you try,” Hatch said in an in­ter­view. “The trouble is, we haven’t been try­ing.”

Cor­rec­tion: This post ori­gin­ally misid­en­ti­fied Sen. Richard Blu­menth­al as Sen. Bill Nel­son. It has been up­dated.

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