A liberal think tank just released its own proposal to fix Obamacare
Posted on Vox.com
The most influential center-left think tank in DC has a new plan to fix Obamacare — and, perhaps surprisingly, it includes some of the same provisions as the Republican health bill in the Senate.
On Thursday, the Center for American Progress released new legislative text that proposes repairing Obamacare’s exchanges through a mixture of new subsidies to help insurance companies cover their most expensive patients, and lower taxes to encourage insurers to set up shop in under-served markets.
The plan is almost certainly dead on arrival with a Republican caucus that has been bent on dismantling Obamacare for years. But CAP is casting it as a bipartisan solution that could give Republicans a lifeline should Majority Leader Mitch McConnell fail to find the 51 votes to pass his bill — and require Democratic support.
“We are at an inflection point where there’s an opportunity for senators to choose a different path,” said Topher Spiro, one of the report’s authors, in an interview. “But it’s a very small window.”
CAP’s plan to stabilize Obamacare, explained
The CAP plan has three main components — two of which are already included in Senate Republicans’ Better Care Reconciliation Act. (All three components have been floating around health policy circles for a number of years.)
The first involves guaranteeing Obamacare’s cost-sharing reductions, which help make copays and deductibles cheaper for lower-income people who get insurance through Obamacare. Trump threatened to stop making Obamacare’s CSR payments — a move that “destabilized” the markets by making it unclear to insurers if they could count on the payments being there. Both Senate Republicans’ BCRA and the CAP plan would guarantee the CSRs.
The second component is a $15 billion “reinsurance” fund. It calls for giving states federal money to give insurers funding for their most expensive, high-cost enrollees — which Spiro says would in turn reduce premium payments for everyone else on the exchanges. (Spiro also notes that Maine and Alaska — two states with moderate Republican senators — have already adopted similar approaches in their states that have shown signs of success.) Because the reinsurance fund would reduce premium costs, and thus the amount of tax credits the government would have to pay out, Blue Cross Blue Shield Association says the $15 billion fund would only cost the federal government $4 billion.
“It’s pretty well known that a very small percentage of patients drive the vast majority of health care costs. That’s the reasoning behind this solution: If you subsidize those high costs, it will bring premiums down for everyone,” Spiro said.
“And it’s plucked straight from the Senate Republican bill.”
These Republican ideas were put into BCRA in order to ease the blow created by the GOP plan to eliminate the individual mandate, which would cause instability in the Obamacare exchanges. CAP is proposing that Democrats and Republicans can agree on these proposals — without the tax cuts for the rich and gutting of Medicaid also envisioned by McConnell’s team.
The third proposal in the CAP plan isn’t in the GOP plan. It involves giving tax incentives to insurance companies who agree to cover patients in parts of the country where there is only one insurer (or fewer). One idea is to encourage insurers by eliminating the health insurance tax for plans that enter these markets, though Spiro said he’s open to other suggestions and tweaks. The plan also says that CAP would support a public option to make sure that everyone is covered.
Should the left be only calling for a public option or single-payer solution instead?
It goes without saying that the biggest difference between the CAP plan and Senate Majority Leader Mitch McConnell’s is that CAP would not call for, well, the rest of BCRA. It scraps BCRA’s massive tax cuts for billionaires, the steep cuts to Medicaid, the deep wound to Obamacare’s subsidies, and essentially only uses the ideas for guaranteeing Obamacare’s Cost Sharing Reductions and the reinsurance fund.
But it’s also a marked break from what some on the progressive left want to see: unified Democratic calls for a public option, or Medicare-for-all single-payer bill. (CAP also supports a public option, and lists it as one possible way to bring down the number of uninsured Americans in the report.)
Earlier this week, the Progressive Change Campaign Committee released a statement preemptively attacking any move on the left to embrace a fix for Obamacare that didn’t include these much more far-reaching fixes to Obamacare.
“Any bipartisan health care solution must, at a minimum, include a robust public option for all or a Medicare buy in for all — and if it doesn’t, it is dead on arrival with the progressive base and most Americans,” PCCC’s Adam Green said.
There is robust support in the Democratic caucus for these ideas. More than half of House Democrats have agreed to cosign Rep. John Conyers’s (D-MI) single-payer proposal — the most support it’s gotten in the party’s history.
Spiro says he’s not bothered by concerns that the left should instead be focused on demanding a public option or Medicare-for-all. Like many in the Senate Democratic caucus, he said the priority has to be on improving Obamacare for patients in the short term — and, above all, stopping Republicans’ dangerous bill.
“You’ve talked to some of these patients: They feel they’re at risk right now and that their care may be impacted next year or the year after. Our immediate focus has to be on stabilizing the markets and removing this threat and this uncertainty,” Spiro told me. “My number one priority, above all else, is to help and protect those people.”