Trump Vows He “Won’t Do Anything To Enrich The Insurance Companies”
Backpedaling, then pedaling forward a little, then backpedaling again, Trump continues to falsely characterize his moves as a near heroic attempt to uncouple the insurance company “gravy train”. Watch here:
Of course this is a total fabrication: the money he cut off goes to help poor people pay out-of-pocket medical expenses. Not to mention the fact that Obamacare has been a huge job creator in this economy: good, well-paying American jobs. The kind Trump says he cares about.
And anyway insurance companies are still required to pay out the cost-sharing subsidies, even with Trump cutting off the funds. Leaving them with three choices:
- Lose lots of money.
- Drop out of markets where large numbers of people receive cost-sharing subsidies.
- Pay for them some other way: the easiest being raising premiums.
That’s why it’s so important for Trump to sell his con: if his supporters don’t see it as him waging war on behalf of the little guy against big evil insurers, all he becomes is the spiteful meddler who’s making them lose choices while their premiums go through the roof.
Skyrocketing Obamacare Premiums Are All Trump’s Fault, And As He Likes To Say “We Have Proof”!
Back in May, Pennsylvania’s UPMC Health Plan told the state it would be increasing premiums an average of less than 8% for 2018.
What changed between last Friday and this week? The greed of insurance companies? No. Was Obamacare suddenly repealed? No. The obstruction of Democrats? No. Only one thing: Trump.
Poor Lamar Alexander
The Senator from Tennessee and Chair of the Senate HELP (“H” stands for Health) Committee went out of his way to pronounce:
“We are having the strongest possible language in the Alexander-Murray agreement to make sure the cost-sharing reduction payments for 2018 and 2019 benefit the low income Americans to help them pay for their insurance and don’t benefit the insurance companies“.
And in an interview with Axios, he even gave Trump all the credit for the compromise he’s been working out diligently for months with Washington Democrat Patty Murray. “Trump completely engineered the plan”, Alexander said. Then he told the Washington Post: “I give the President full credit….We don’t want chaos with millions of Americans hurt.” He even said lots of people think Trump doesn’t know what he’s doing, but he’s not one of them. Here’s the clip:
So Is It Dead Or Isn’t It?
End of day, the White House left it at: “A good step in the right direction” but needs to go “a little bit farther.”
Meanwhile, House Speaker Paul Ryan said he doesn’t like that the deal might shift focus away from “Repeal and Replace”. Which while short of an outright condemnation, does not bode well, considering he controls its path to the floor for a vote. Meaning he’ll need a reason to move it forward: either because it would be very good for him to do so, or very bad for him not to.
Here’s Why It Still Might Pass
Not paying cost-sharing subsidies is going to cost the government a lot of money. As we mentioned last week, the CBO estimates ending cost-sharing payments will lead to an increase in the federal deficit of $194-billion over the next 10 years, $27-billion in the next 3 years alone.
That doesn’t really make sense, right? One would think stopping payments would save the government (and taxpayers) money. So let’s take a second to explain why the CBO says the opposite is actually true:
Obamacare provides substantial support for people at or near the poverty line.
- People below or at the poverty line (up to about $24,000) get Medicaid, which is not impacted (at least for now).
- If you earn too much to qualify for Medicaid, but less than 250% of what the government considers the poverty line, you get help paying both your premiums and your out-of-pocket costs.
- If you earn up to 400% more than the poverty line, you get subsidies to help cover your premiums only.
Trump’s discontinued only the 2nd set of subsidies for that 2nd, middle group.
Meanwhile, the 1st set of subsidies, which is paid to both the non-Medicaid groups, is about to get a lot more expensive.
But wouldn’t the money saved by cutting off cost-sharing payments more-or-less make up for the increase in premiums, making the whole thing a wash? Yes, but only for the people in that middle (>250%) group. For people in the “up to 400% of poverty line” group, the government will now be paying for a premium hike that would not have otherwise occurred. Another way of saying it is that the average subsidy per person will increase substantially, and the government’s on the hook for all of it.
And that’s why the government bleeds money. Obamacare bases subsidies to low-income people not on how much their insurance actually costs, but on a percentage of their earnings. If premiums go up substantially across the board, the federal government ends up with a bigger bill.
The Best Path Forward Is Still Filled With Obstacles
Here’s what will probably happen: an attempt to fold Obamacare stabilization into a broad year end spending bill which needs to be passed by early December in order to avert a government shutdown.
In some ways that makes more sense than trying to do it as a stand-alone because it gives Republicans and Democrats more room to do trade-offs for things perhaps not related to health care at all.
That’s also potentially the problem: the temporary Obamacare fix then becomes another item on a long list of already wildly contentious issues including DACA, “the wall”, defense spending limits, hurricane and wildfire relief. It also means nothing would happen until the open enrollment period to sign up for Obamacare in 2018 is nearly over.
So as the President also likes to say: “who knows?”
(On a side note, this has nothing to do with the “budget resolution” likely to pass today. As Roll Call explains, that process is almost completely meaningless in itself: in fact two Senators will introduce a bipartisan amendment today to declare it a sham. But it’s essential as a procedural vehicle for Republicans because it clears the way for the Senate to potentially pass tax cuts with a simple majority).
If Your Answer Is “No”, This Is A Pretty Weird Way Of Saying “No”
We’re referring to Attorney General Jeff Sessions, who appeared in an open session before the Senate Judiciary Committee. When asked if he’d been interviewed by Special Counsel Robert Mueller or been requested to, Sessions blushes, evades the question, asks for the question to be repeated, swallows hard, evades again, asks a question back to the questioner, and then suddenly blurts out “No”. What’s up with that? We’ll show you the clip, and if you can figure it out, please let us know!