Tag Archives: Vermont

A “Grand Bargain” on Obamacare Repeal?

To know where you’re going, it helps to recognize where you’ve been. Examining the causes of Republicans’ legislative setbacks on health care—including last month’s dramatic failure of a “skinny” repeal bill on the Senate floor—provides the glimmer of a path forward for a legislative “repeal-and-replace” package, if they are bold enough to take it.

In both the House and the Senate, debate focused on a push-pull between two competing issues: The status of Medicaid expansion in the 31 states that accepted it, and what to do about Obamacare’s regulatory regime. During the spring and summer, congressional leaders attempted messy compromises on each issue, phasing out the higher federal match for Medicaid expansion populations over time, while crafting complex processes allowing states, insurers, or both to waive some—but not all—of Obamacare’s regulatory requirements.

But rather than constructing substantively cumbersome waiver arrangements—the legislative equivalent of a camel being a horse written by committee—Occam’s Razor suggests a simpler, cleaner solution: Preserving the status quo (i.e., the enhanced federal match) on Medicaid expansion in exchange for full repeal of Obamacare’s insurance regulations at the federal level.

A “grand bargain” in this vein would give Senate moderates a clear win on Medicaid expansion, while providing conservatives their desired outcome on Obamacare’s regulations. For this conservative at least, the regulations represent the heart of the law, prompting both its spending on exchange subsidies—to offset the higher premium costs from the regulatory mandates—and the taxes needed to fund that spending. Expelling the regulations from the federal statute books would represent a clear step towards the promise of repealing Obamacare “root and branch,” and return control of health insurance to the states, where it lay from 1947’s McCarran-Ferguson Act until Obamacare.

Federal Regulations Are Driving Up Health Costs

When coupled with structural reforms to Medicaid—a block grant or per capita caps—included in the House and Senate bills, repealing the federal regulations would enable the “laboratories of democracy” to reassert control over their health insurance markets and Medicaid programs. It would also contrast favorably with a recent proposal introduced by senators Lindsey Graham (R-SC) and Bill Cassidy (R-LA). While Graham claims his plan would “empower each individual state to choose the path that works best for them,” in reality it would retain federal dictates regarding pre-existing conditions—the most costly of all the Obamacare mandates.

In a sad irony, some of the same senators who want Congress to respect their states’ decisions to expand Medicaid also want to dictate to other states—as the Graham-Cassidy plan does—how their insurance markets should function. But the true test of federalism applies not in the principle’s convenience, but in its inconvenience.

I do not support single-payer health care, but as a federalist, I support the right of states like California and Vermont to explore a state single-payer system. There are other, arguably better, ways to cover individuals with pre-existing conditions than a Washington-imposed requirement, and true adherents of federalism would empower states to explore them.

Yes, This Idea Is Imperfect

To be sure, even this attempted “grand bargain” includes noteworthy flaws. Retaining the enhanced Medicaid match encourages states to prioritize expansion populations over individuals with disabilities in traditional Medicaid, and may lure even more states to accept the expansion. Keeping the higher Medicaid spending levels would preclude repealing all of Obamacare’s tax increases. And the Senate parliamentarian may advise that repealing Obamacare’s regulations does not comport with the budget reconciliation process. But despite the obvious obstacles, lawmakers should seriously explore this option. After Republicans promised repeal for four straight election cycles, the American people deserve no less.

Throughout the repeal process, conservatives have bent over backwards to accommodate moderates’ shifting legislative goalposts. When moderates objected to passing the repeal legislation all but one of them voted for two years ago, conservatives helped construct a “repeal-and-replace” bill. When moderates wanted to retain the Medicaid expansion in their states—even though the 2015 repeal bill moderates voted for eliminated it entirely—conservatives agreed, albeit at the traditional match rates. And when Senate moderates complained, conservatives agreed to a longer phase-out of the higher match rate, despite justifiable fears that the phase-out would never occur.

Winston Churchill purportedly claimed that Americans will always do the right thing—once they have exhausted every other possibility. This “grand bargain” may not represent the “right” outcome, or the best outcome. But conservatives have exhausted many other possibilities in attempting to come to an agreement. Perhaps moderates will finally come to accept federalism—giving states a true choice over their insurance markets, rather than trying to dictate terms—as the solution to keeping their promise to the American people and repealing (at least part of) Obamacare.

This post was originally published at The Federalist.

More on State Flexibility

Three interesting points on the ongoing debate over states’ Medicaid budgets and flexibility under the health law:

First, liberal commentators in the past few days have made striking admissions that the President’s proposal for state waivers does NOT give states the flexibility to enact conservative health care solutions.  This morning Jonathan Cohn wrote a column including this line: “[Senator] Hatch…and other critics of Obama’s proposal have a point: It wouldn’t allow them to enact the sorts of health care reforms they would prefer.  Likewise, the Post’s Ezra Klein notes that “conservatives can’t do any better – at least not under these rules.”  Both columnists go on to say this lack of flexibility is a good thing – defending the richer benefit mandates that will raise the price of individual insurance by $2100 per family, according to the Congressional Budget Office.  Cohn also goes on to promote a single-payer health care system as a “more efficient” plan that could receive a waiver – “not the sort of health care alternative conservatives have in mind.”  Mind you, some (certainly not all) conservatives might actually support a state like Vermont that seeks to enact a single-payer alternative – so long as states like Indiana or Utah have the flexibility to enact THEIR alternative without meeting new federal requirements.  But Cohn and Klein both admit that the “flexibility” in the President’s proposal only goes one way – towards more government involvement and regulation.

Second, does anyone remember the debate over the Basic Health plan during the Finance Committee markup in October 2009?  You may recall that Sen. Cantwell offered an amendment to the Finance bill – which later became Section 1331 of the statute – allowing states to receive funding to establish programs similar to Washington state’s Basic Health plan.  Well, a New York Times article this morning reported that “Gov. Christine Gregoire of Washington, a Democrat, recently removed 17,500 adults covered under Basic Health.”  It’s an interesting admission that what Democrats once viewed as a de facto government-run plan hasn’t succeeded in controlling costs – either that, or states need more flexibility in managing their health care programs during times of tight budgets (or both).

Finally, if you haven’t had a chance to read the testimony from yesterday’s governors’ hearing yesterday morning, it’s worth taking a few minutes to do so.  Governors Barbour and Herbert both gave specific examples of how they are attempting to innovate within their Medicaid programs, and how Washington bureaucratic requirements – such as Utah’s eight-month-long expedition to get approval to send e-mails to beneficiaries – frequently get in the way.  (Other coverage of the hearing – and the joint Finance/Energy and Commerce report on states’ $118 billion in Medicaid costs – can be found in articles by the New York Times and Washington Post.)

Vermont Finds Its High-Risk Pool Program All Wet

While most of the news media was focused on the release of the Medicare trustees report last Thursday, the state of Vermont made an interesting admission regarding its high-risk pool program.  Specifically, the state sent HHS a letter asking the federal government to establish a pool in Vermont.  State officials were forced to revert to the federal pool program after concluding that a state-run risk pool in Vermont “could not be operational until at least July 1, 2011.”

Unfortunately, Vermont’s letter does not represent the first difficulty in implementing the risk pool program created under the health care law.  HHS did not meet the deadline for starting the risk pool established in statute, and state implementation difficulties such as those in Vermont could keep states from starting their programs until the fall (or later).  Moreover, the Congressional Budget Office found that the program’s $5 billion funding level will not be enough to meet demand, and could result in up to 500,000 people with pre-existing conditions being denied access.

Republicans support high-risk pool programs – but support implementing and funding them properly – because coverage for individuals with pre-existing conditions should not take a back seat to other dubious spending priorities in the Democrat health care law, like backroom deals and a new $15 billion slush fund for jungle gyms and other pet projects.

The Check’s in the Mail — Now Send It Back!

Politico has an article this morning regarding the “doughnut hole” rebate checks being sent to seniors: “No sooner than the Administration dropped the first batch of $250 Medicare rebate checks in the mail, they have already run into their first snafu.”  Specifically, the state of Vermont’s low-income program – which provides “doughnut hole” coverage to 2,800 seniors – is asking those beneficiaries to send their rebate checks to the state government.  So either some Vermont seniors will be provided with a $250 check at federal taxpayers’ expense to cover the cost of a benefit they’re already receiving from the state, or the Administration will once again have over-promised and under-delivered on the “benefits” provided by their new health law.

While the Administration and Vermont officials continue arguing over who will receive the $250 checks – with low-income seniors stuck in the middle – it’s once again worth asking: How does any of this bureaucratic wrangling constitute “reform?”