Executive orders
from President Trump will do the trick.
All Democrats and an odd coalition of very moderate and very
conservative Republican Congressmen in effect voted that Obamacare was
preferable to Trump-Ryan health reform.
President Donald
Trump was not pleased: “The best thing politically is to let Obamacare
explode,” leaving it “totally the property of the Democrats.” When folks “get a
200 percent increase next year — or a 100 percent or 70 percent” surge that’s
“their fault.”
But the media
will blame him and the Republicans regardless, so what should the president do?
He was on the
right track to ignore the dysfunctional Congress, Democrats and Republicans
alike, and let nature take its course on healthcare for a while. The House
cannot fix it, so its leadership should back off from a planned second attempt
next week.
The fact is the
individual insurance that was the focus of the defeated House bill is a tiny
part of health coverage. Medicaid, which was a part of the proposal, and
Medicare insure almost forty percent of the population and a tenth or so are
uninsured. But among the other half privately insured 88 percent are covered
through their employer and only twelve percent by individual insurance. And, as
with individual insurance, large employers who do not offer benefits that meet
expensive Federal “minimum value and affordability standards” can be penalized.
After the
individual Exchanges collapsed on day one, even President Barack Obama realized
the better part of valor was to delay implementation of Obamacare for
employer-provided private health insurance, and to defer the so-called Cadillac
tax on generous high-benefit health insurance. President Obama further
postponed the enforcement of penalties until 2017, leaving his successor
president to handle complaints.
All those
academic and journalist intellectuals, Democratic politicians, health
lobbyists, and foundation experts — all extolling the benefits of Obamacare —
and do not forget Congressmen with most of their premium paid by the taxpayer —
are just now fully experiencing the joys of Obamacare. Indeed, most of the
upper-middle class liberals who want Obamacare passionately for their more
unfortunate brothers and sisters may not be so anxious for it themselves or for
letting Obamacare’s Cadillac tax go into effect to further increase their health
insurance burden.
Although almost
completely ignored by the media and in the Congressional debates, the
consequences of Obamacare for the employer market are just as dire as for the
individual one. A 2016 Kaiser Family Foundation study found
that, without counting the majority of premium costs borne by the employer
directly, premiums for individuals under employer insurance increased by 20
percent for a family to $5,277, with deductibles exploding an incredible 63
percent and deductibles of $1,000 or more increasing by 51 percent between 2011
and 2016, increasing the de facto cost to each one of $7,000 or more per year.
Now it is the
elites’ turn to see what the country has been complaining about.
President Trump
did reach out to Democrats, but they want the tax penalty as the stick that
forces young, healthy people to sign up to balance the sick people who know
they need insurance, providing some balance on costs. But the tax penalty is
one of Obamacare’s most unpopular features. Enforcement of the penalty has been
delayed by Democrats so far, and to defer to them President Trump would have to
override President Obama’s own policy of delaying penalties, hardly possible politically.
Without the young, premiums would certainly surge dramatically.
By simply
continuing his predecessor’s policy of delaying enforcement, more and more
health insurers will be forced to abandon an increasingly unprofitable
business.
Even if he
approved enforcement, the insurance companies still need the Obamacare
cost-sharing subsidy payments that are at issue in the lawsuit filed by the
House of Representatives against the executive branch, challenging its
authority to make such payments. Could the president fight the House and his
voters in the name of subsidizing big health insurers $7 to $10 billion a year?
If he did he would lose all credibility with his base.
On the other
hand, all Health and Human Services Secretary Tom Price — who is now the
defendant in the House suit — need do, is concede the House was correct
legally, and the subsidy ends. Congress does not need to do a thing and
Obamacare becomes unprofitable and expires.
The other
possibility is for the president to again simply follow his predecessor and
reform Obamacare through executive regulation alone — as President Obama did at
least forty times.
President Trump would need only three modifications.
First, a main
sticking-point for conservatives has been overly permissive and expensive
mandated benefits, especially for unproven types of preventive care. While
these benefits are broadly listed in law, it is up to the HHS secretary to
specify them. There is plenty of room to review and limit the number and type
of specific requirements and their resulting expenses for both individual and
employer plans, and Secretary Price would know just how to do it right.
Second, the most
costly Obamacare provision was granting many above the poverty line access to
the Medicaid entitlement. President Obama has already granted waivers allowing
states flexibility under the program. Sec. Price could do the same, and much,
much more. He has already revealed he would grant waivers to states that want
to experiment more broadly. Such things as work requirements for the
able-bodied, the less-poor paying premiums, and even leaving most regulation to
the states are possible under such waivers.
Finally,
President Obama has already granted broad waivers of individual tax penalties
in “hardship” cases, including the harm of losing one’s old health insurance,
which everyone has done by now. So, Sec. Price could simply rule that all
Americans deserve hardship exemptions since they were promised they could keep
their old insurance and in fact they could not. No one would be left penalized
under Obamacare and all would be free to go in a different direction.
Indeed,
President Trump signed an executive order in January directing HHS to minimize
the regulatory burdens of Obamacare, to take steps to “waive, defer, grant
exemptions from, or delay its rules.” All his administration needs to do is
act.
Either nature
takes its course and Obamacare explodes or through executive regulation it is
radically redesigned. Either way a market would pretty much be left to develop
under state regulation to work its way out of the present morass.
Imagine relying
upon freedom? What a concept!
Donald
Devine is a senior scholar at the Fund for American Studies, the author of America’s Way Back: Reclaiming Freedom, Tradition, and
Constitution, and ran the nation’s largest employer health insurance
plan under President Ronald Reagan as director of the U.S. Office of Personnel
Management during the first Reagan term.
