Yesterday they were right on the cusp of failure with 21 Republican no votes in the bank and Ryan able to afford no more than 22 defections. Today they’re back from the brink: Upton and Long, each of whom was a no 24 hours ago, are in the yes column now, a significant shift given Upton’s role as a former head of the health-care-heavy Energy and Commerce Committee.
And all it took was a largely meaningless window-dressing amendment that might actually end up making the bill worse.
The White House earlier signaled optimism, with budget director Mick Mulvaney telling Fox News on Wednesday that the chamber might vote on the health bill as early as Saturday. Mulvaney said he believes the amendment by Upton — who became perhaps the most significant Republican defection yet on Tuesday — will help draw moderates’ support for the legislation.
Upton’s amendment would provide $8 billion over five years to reduce premiums and other costs for those with pre-existing conditions who have a gap in coverage and reside in states that received waivers from some of Obamacare’s requirements under another provision in the bill, according to a Republican aide.
We’re talking about an extra $8 billion for a fund that already included $130 billion to help support state high-risk pools, yet which lefty wonks like the Center for American Progress insist is nowhere near having the amount of funding it’ll need to keep those pools afloat. (CAP estimates that $200 billion over the next 10 years, not $8 billion over the next five, is more on the order of what’s needed. With some reason: State experiments with high-risk pools have proved very expensive.) Even under the GOP estimate, the funding in Upton’s amendment is a rounding error, not something that’s going to make the pools appreciably better.
On the contrary, it could create perverse incentives in the market. Some of that $8 billion will be used to help people with preexisting conditions who had a lapse in coverage, which makes them subject to higher premiums in the high-risk pool and a 30 percent surcharge/penalty under the AHCA. Upton’s amendment will defray those costs. But … those costs are there for a reason. As with the ObamaCare mandate penalty, they’re designed to incentivize people to sign up for insurance and start paying into the risk pool immediately, not wait until they’re very sick and their health coverage is suddenly very expensive. Upton’s amendment should make it easier for them to delay signing up, which means an even sicker and more expensive risk pool than you might expect:
See why it’s reasonable to fear that the pools will be underfunded?
Why, oh why, if Upton’s amendment does little to improve the bill and possibly raises the chances of underfunded pools, would he and Billy Long cite it as a reason to flip from no to yes? If you read Philip Klein’s takedown of Upton yesterday for his amazing cynicism in opposing the AHCA, you already know why. For years, Upton crusaded on behalf of exactly the sort of measures the new AHCA would permit to the states — getting rid of ObamaCare’s regulations on Essential Health Benefits and community rating. If you want to cut costs for the general population, Upton insisted, you need to stop forcing expensive one-size-fits-all plans on consumers. As of yesterday he had a chance to support a plan that does exactly that but was voting no, presumably because he knows that the public dislikes the idea of letting states waive ObamaCare’s regs is unpopular with the public. That is, he was happy to call for repeal when he knew Obama would be there to veto the GOP’s bill; now that it has a chance of becoming law, he has cold feet. Viewed through that prism, the $8 billion Upton amendment looks like little more than a fig leaf he can point to back in his district when voters inevitably start complaining about the bill. “I made the bill better,” Upton can say in defending his new yes vote. “I got an extra eight billion for sick people!” In reality, his amendment may end up doing more to destabilize the market for people with preexisting conditions than to shore it up. But it looks good politically, and that’s what matters.
The latest rumor is that the vote will happen tomorrow. Buckle up.