House Republican leaders say they’re happy to help with a contingency plan if the Supreme Court invalidates Obamacare’s tax credits in the 30-plus states that use the federal HealthCare.gov website.
But that help would come at a high price.
Should the Court rule against the Obama administration, the GOP leaders would seize the opportunity to significantly reshape the health care landscape — while keeping some of the more popular parts of the Affordable Care Act.
A plan from three key Republican committee chairmen proposes giving states the opportunity to repeal Obamacare’s individual and employer mandates as well as its coverage requirements. That alone would change the law’s mechanics in fundamental ways and represent a huge political and policy victory for the GOP. States, the majority of which are controlled by Republicans, would be able to opt out of some of the law’s major and most-hated provisions.
The Supreme Court will hear oral arguments in King v. Burwell on Wednesday. If the justices rule against the Obama administration and disallow tax credits on HealthCare.gov later this year, as many as 8 million people are expected to lose their financial aid under the law.
“If that happens, then you’ll have some 4 [million], 5 million people who will find themselves where they didn’t think they were going to be. So we think it’s important to have some provisions in place,” House Education and the Workforce Chairman John Kline, R-Minn., told National Journal.
“In the larger sense, I think the proposals that we’re looking at would indeed be much better for health care, because obviously we don’t like the Affordable Care Act,” Kline added. “Those things “¦ are ways to look to lower costs, so we think that King v. Burwell may be what allows us to make them.”
Kline, Ways and Means Chairman Paul Ryan, R-Wis., and Energy and Commerce Chairman Fred Upton, R-Mich., introduced the proposal Monday in a Wall Street Journal op-ed.
Aside from pointing a policy path forward, the Republican proposals serve another role: signaling to the Supreme Court that congressional Republicans would be ready to act if the Court ruled to nix the tax credits on HealthCare.gov, which could otherwise send the insurance markets in the states that use the federal website into chaos.
Their plan would keep some features of Obamacare in place. It would create a tax credit to help people buy insurance, intended to restore financial aid to the millions of people who would lose it if the Court ruled against the Obama administration, although the specifics would differ from the ACA’s current tax subsidy. The GOP plan would keep the law’s ban on lifetime benefits and allow children to stay on their parents’ insurance until age 26. It would also provide some protections for people with preexisting conditions and allow small businesses to pool together to purchase insurance.
And by giving states a choice, some states — namely, the dozen-plus that have created their own exchanges and wouldn’t be directly affected by a Court ruling striking down the Obamacare subsidies — could continue implementing the law wholesale.
Some of the policies that Republicans would allow to stand are ones that they have supported since before Obamacare, Kline said.
“That proposal, for example, the age-26 [provision], was in the alternative we proposed before the ACA passed,” he said. He also listed allowing people to buy insurance across state lines and the small-business pools as policies in their King contingency plan that the GOP had proposed before. “Those were all pieces that we had proposed before this was jammed through in 2009.”
There is the catch, though, that these proposals aren’t yet codified in legislative language, where the all-important minutia will be fleshed out. House Republicans plan to formalize their proposal in legislation before the Court makes its ruling, expected this summer, an aide said.
“If you take these ideas from Republican leaders at face value, it’s apparent that at least at the level of broad principles, the central aims of Obamacare have become hard to oppose,” said Larry Levitt, vice president of the Kaiser Family Foundation. “These proposals could, of course, look very different once the details are fleshed out. And, they signal much less regulation of the insurance industry than under the Affordable Care Act.”
Sens. Lamar Alexander, R-Tenn., Orrin Hatch, R-Utah, and John Barrasso, R-Wyo., wrote an op-ed in The Washington Post on Monday, announcing that they too would put forward a post-King plan. Hatch, Upton, and Sen. Richard Burr, R-N.C., released another health care proposal earlier this month, although it is a full repeal-and-replace plan not as directly tied to the King case.