Bipartisan ObamaCare compromise collapses even quicker than you'd expect

So much for the dawn of the New Era of Bipartisan Pragmatism. News emerged yesterday afternoon that Senators Lamar Alexander and Patty Murray had reached a compromise to stabilize ObamaCare, restoring direct subsidies to insurers ended by Donald Trump in return for greater flexibility on mandates and state control. Murray declared that the deal would end the “uncertainty and disruption” in the health care industry that resulted from the “sabotage” of the Trump administration.


“When Republicans and Democrats take the time to work together under regular order rather than retreating into partisan corners,” Murray said in her announcement, “we can truly get things done that help people that we serve.”

Or …. maybe not:

Yet another last-ditch effort to tackle the nation’s health-care system stalled within hours of its release by a bipartisan pair of senators Tuesday, with President Trump sending mixed signals and Republicans either declining to endorse the proposal or outright opposing it.

The week began on Capitol Hill with a renewed sense of urgency to craft legislation following Trump’s decision last week to end key payments to health insurers that help millions of lower-income Americans afford coverage but that the president argued were illegal under the Affordable Care Act.

The compromise offered by Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) on Tuesday proposes authorizing those payments for two years in exchange for granting states greater flexibility to regulate health coverage under the ACA. Those payments help offset deductibles and other out-of-pocket costs for low-income consumers who obtain insurance through the law; critics of Trump’s decision said eliminating the subsidies would cause insurers to back out of marketplaces across the country.

The same critics who claim that are speaking warmly of another Democratic initiative, “Medicare-X”, which is the revived public option that got stricken from the original ObamaCare proposal. That would undercut prices on exchanges and force insurers out even more quickly than an end to CSR subsidies will do. The most acute impact of the ending of CSR payments is to force insurers to price premiums correctly rather than ask taxpayers to make up losses on the back end, which Democrats would continue in perpetuity.


What exactly did Republicans get in exchange for appropriating funds for CSRs the next two years? Democrats agreed to allow catastrophic insurance plans to be sold on the exchanges, but only for people 30 years of age and older, which is very odd. The target market for that would be younger Americans, not older, especially those without families. Democrats still want to force a wealth transfer from twenty-somethings to older Americans through mandated coverage they largely don’t need or want. It’s barely a concession at all.

The other Democratic compromises were no better.  The deal also loosened some restrictions on state waiver requests, but did nothing to expand them. It offers no relief at all on federally mandated essential health benefits (EHBs), nor did it address at all the mandate to cover pre-existing conditions at community-rating prices. In other words, all it does it maintain the backdoor bailout of the CSRs for two years while leaving the structural reason for them intact.

At first, Trump seemed optimistic about the opportunity to punt for the next two years. By this morning, he’d changed his mind:

That’s a lot more polite than Trump usually gets, which might be part of his new efforts at partnering up with Mitch McConnell. His other partner in leadership, House Speaker Paul Ryan, joined in opposing Alexander-Murray:

House Speaker Paul Ryan’s press secretary, Doug Andres, told Axios Wednesday that despite the bipartisan push behind the Alexander-Murray health bill, “The speaker does not see anything that changes his view that the Senate should keep its focus on repeal and replace of Obamacare.”


Even if the bill got out of the Senate, which Axios reminds us would take 60 votes at some point in the process, Ryan’s opposition all but kills any chance of getting a majority in the House.

Not everything that’s “bipartisan” is wise. Alexander-Murray provides an excellent example of that principle.

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