After Obamacare Repeal Collapse, GOP Weighs Whether To Help State Markets

Sen. Lamar Alexander (R-TN) talks with reporters shortly before GOP efforts to repeal Obamacare collapse oni Thursday, July 27, 2017. (Photo By Bill Clark/CQ Roll Call via AP Images)
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Tierney Sneed contributed reporting.

This story was updated at 9:34 a.m.

Still dazed from the spectacular collapse of their efforts to repeal Obamacare, Republicans are now confronted with the question of whether they’ll seek to help Americans in states where insurers are pulling out of the individual marketplaces and premiums are rising without trying to gut the program.

Until now, most Republicans have been happy to watch some state-level individual health insurance exchanges sputter along, using those struggles as their main talking point for how Obamacare is failing under its own weight as the Trump administration exacerbated some of the exchanges’ problems.

They assumed they’d be able to execute a broader policy change rather than worry about shoring up the markets. But after admitting defeat (at least for now) on a broad overhaul of the law, Republicans are beginning to come to grips with what to do going forward.

“We’ve got to do something. The repeal effort’s dead so I think the next logical thing is we have to try to reach out and figure out where we can make health care better,” Rep. Adam Kinzinger (R-IL) told TPM Friday, just hours after the Senate failed to pass a placeholder bill to keep Obamacare repeal efforts moving. “This is kind of all new territory for us, we’re getting our sea legs under us.”

Democrats are hopeful that their GOP brethren will be ready to move forward and craft a plan to stabilize the exchanges in the states that have been struggling.

“I think at the very beginning we should stabilize the system. We should make permanent a cost sharing, which keeps people’s premiums down and keeps the counties that are covered up,” Senate Minority Leader Chuck Schumer (D-NY) said in a press conference Friday morning, a few hours after the GOP bill failed on the Senate floor. “We should look at reinsurance.”

But it’s unclear if Republicans are ready to move on and help fix the very real problems of some state-based exchanges in places like Iowa and Missouri where parts of states are left with just one, or even zero, health care options.

President Trump, the man with by far the most power over that issue, has indicated he’s happy to let the exchanges continue to struggle — and threatened over the weekend to intentionally torpedo them.

Trump has said many things he’s failed to follow through on. But the Trump administration has sought to undercut the Affordable Care Act ever since he was sworn in, from kneecapping efforts to get more people enrolled in the programs (and consequently bring down costs) to signing a vague executive order on his first day in office implying the IRS might not enforce the individual mandate’s tax penalties to removing any references to the ACA on the Health and Human Services Department website, making it harder for people looking for information on how to get enrolled to find it.

Their biggest potential sabotage may still be to come — and will be the first major test for whether Republicans are ready to work in a bipartisan way to help Americans after their efforts collapsed, or whether they’ll look to hurt the markets for political reasons to try to force Democrats to the table, as Trump has threatened.

The administration faces a deadline next month to pay out subsidies to insurers known as “cost-sharing reductions,” which were the target of a 2014 GOP House lawsuit and Trump has threatened to halt in order to implode the individual market.

Past those basic payments, some state individual exchanges do need support — be it more federal subsidies or program tweaks — to get them functioning better. And while lawmakers in both parties aren’t crazy about the idea of just throwing more money at insurers to entice them back into those markets, most admit they need to do something going forward.

Republicans are split on whether to do either, though most believe that pulling the CSR payments would be policy malpractice, intentionally hurting Americans to make a political point, and carry big political risk.

“I have said since December that while the CSR payments are not constitutional they need to be made in a legal way so that the market does not collapse. I have not changed my mind on that. We have to put the consumer first,” House Energy and Commerce Committee Chairman Greg Walden (R-OR), whose committee is responsible for large chunks of healthcare policy, told TPM Friday morning. “If we don’t make the CSR payments, it’s the consumer that suffers.”

Still, as they woke up to the realization that they may be stuck with Obamacare in spite of holding unified control of Washington, plenty of Republicans weren’t feeling as charitable.

“This is not the day to talk to me about putting more money into a system that’s failing,” grumbled Rep. Joe Barton (R-TX), Walden’s predecessor as Energy and Commerce Chairman. “We don’t want them to fail but everybody that’s been voting no needs to come up with a plan that doesn’t cost more money and lowers premiums. If they can do that then come see me, but don’t come to me with more federal subsidies. That dog doesn’t hunt.”

There are some positive signs of bipartisan efforts. The chairman and ranking member of the Senate committee tasked with dealing with the largest chunks of healthcare, Sens. Lamar Alexander (R-TN) and Patty Murray (D-WA) have expressed interest in working in a more bipartisan way to handle legislation on the topic going forward.

“I voted to take the next step toward what I believed was our best opportunity to repeal and replace Obamacare. The Senate’s failure to do this leaves an urgent problem that I am committed to addressing: Tennessee’s state insurance commissioner says our individual insurance market is very near collapse,” Alexander said in a statement after the vote failed.

And a bipartisan group of House lawmakers are slotted to unveil a plan to help stabilize state health exchanges while shrinking the employer mandate on Monday.

But even those Republicans who say they want to work in good faith to improve things in the short term aren’t sure what can be accomplished, given a deep distrust that Democrats will work with them in good faith to make changes in spite of repeated overtures from across the aisle. And they hint they’d been so focused on repealing Obamacare, they weren’t prepared with plans if it stood.

“I haven’t really thought about this very much,” Rep. Tom Cole (R-OK) told TPM Friday when asked what to do to stabilize the markets, before thinking out loud about his options. “I’m not for letting things fail but … throwing good money after bad indefinitely is not going to work either.”

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