There are two health care-related sideshows playing out in Washington. One is a semantic argument about whether the fine for not having health insurance under Obamacare is a “penalty,” as the law’s author’s originally claimed, or a “tax,” as Supreme Court Chief Justice John Roberts ruled last month. The other is a House Republican attempt to immediately repeal the health care law, which is scheduled to get another vote this week. Neither of these debates has any consequence. In fact, they’re obscuring the real reasons the Affordable Care Act’s future is still incredibly uncertain, even after the High Court’s decision to uphold the law.
If Mitt Romney is elected President and Republicans emerge from this year’s elections with majorities in both houses of Congress, most experts agree that they could repeal huge swaths of the health care law via reconciliation, the parliamentary process that allowed Democrats to push health care reform over the finish line in 2010 without a supermajority in the Senate. As Politico reports (subscription required), GOP staffers on Capitol Hill are currently studying exactly what pieces of the law could be subject to change through reconciliation.
Congressional rules say the process can only be used for legislation that affects the federal budget and lowers the deficit, but that applies to much of the ACA. Subsidies created by the law to help low and middle-income Americans buy insurance outside of work could be vulnerable, for instance, even if Republicans can’t repeal the whole law, which the Congressional Budget Office says reduces the deficit. The loss of those subsidies could seriously imperil the affordability of insurance and the effort to pull currently uninsured Americans into the coverage market.
But even if Democrats hold onto their majority in the Senate, there’s no guarantee the law will remain untouched. Should Mitt Romney win the presidency, he could still cripple the health care law. A recent story in the New York Times about the Obama Administration’s efforts to undercut George W. Bush’s signature education law, No Child Left Behind, offers some insight. By granting waivers, the Times reports that the Obama Department of Education has allowed 26 states to escape NCLB’s controversial requirement that students meet testing standards in reading and math.
“The more waivers there are, the less there really is a law, right?” said Andy Porter, dean of the University of Pennsylvania’s Graduate School of Education.
The waivers appear to follow an increasingly deliberate pattern by the administration to circumvent lawmakers, as it did last month when it granted hundreds of thousands of young illegal immigrants a reprieve from deportation. The administration has also unveiled policies to prevent drug shortages, raise fuel economy standards and cut refinancing fees for federally insured mortgages.
Predictably, congressional Republicans are crying foul over NCLB, accusing the Obama Administration of implementing its own policies instead of those outlined by the education law, which had broad bipartisan support when it passed the House and Senate in 2001. Still, you can be sure that a GOP presidential candidate vowing to “repeal” the health care law on “day one,” would do everything in his power to make good on his campaign promises.
The ACA may be particularly vulnerable under a Republican President due to its sheer complexity. Because the law has so many moving parts and affects so many constituencies, the ACA was written in a way that leaves many details up to the Department of Health and Human Services and its presidentially appointed head, who guides the rules-writing process. Such flexibility is often a good thing, says Gail Wilensky, a health care economist and former head of Medicaid and Medicare under George H.W. Bush. Flexible, vague statutes are more adaptable to changing circumstances. The downside, though, is that a lot is open to interpretation.
“When you write implementing regulations, you ought to think about it as a broad band,” says Wilensky. “At one end, you do the least you have to do in order to comply with the word of the statue. At the other end is the most that would be permissible without exceeding the authority given by the statute. In between those two points, there frequently is a wide span. In this case, it’s wider than normal. So much of the specific was not in the statute itself and that is what is going to make it vulnerable.”
The Obama Administration aims to have most of the major ACA regulations written by the end of the year. And it’s on target to reach that goal, according to Judy Solomon, vice president for health policy at the Center on Budget and Policy Priorities and an expert on federal health regulation. Solomon says regulations that are final or on track to be final by year’s end include designs for state health insurance exchanges, employer and individual mandates, and eligibility rules for Medicaid and new federal subsidies to help Americans afford coverage.
Yet, even regulations that Obama’s HHS finalizes can be re-written under a new Administration. “They can’t change the law unless they have the ability to pass a new law,” says Wilensky, referring to the ACA itself. “But you can change priorities. You can try to starve some activities. You can advise the (Centers for Medicare and Medicaid Services) administrator to focus elsewhere.” Although most of the spending called for in the ACA will happen without further action by Congress, some spending for ACA administrative functions is subject to congressional approval and could be vulnerable.
As for waivers like those the Obama Administration offered to states under No Child Left Behind, Solomon says there is not an exact parallel with the ACA. While the education law is a set of rules states must follow, the ACA also has many aspects that apply to individuals. Hundreds of billions of dollars in health insurance subsidies will still be distributed via federal tax credits. “This law makes individuals eligible for things,” says Solomon. A new administration can’t waive that eligibility.
(PHOTOS: The Rich History of Mitt Romney)
Democrats put a lot of political calculation into the ACA’s design and the timeline for putting it into effect. They delayed implementing most of the law until 2014 so the Congressional Budget Office, when measuring its budget impact in the 2012-2022 window, would find the ACA to be deficit reducing. (The law’s major costs don’t kick in until 2014.) In hindsight, this delay was a big gamble. Few Americans have yet been touched by the law, which has allowed critics to define it in the abstract. And the law’s most important implementation phase could come after Obama leaves the White House.