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In budget deal, health law foes took a different path

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Republican foes of President Barack Obamas health care law may be able to get more by chipping away at it than trying to take the whole thing down at once. Thats the lesson of the budget deal passed by Congress and signed by the president on Dec. 18. It delayed a widely-criticized tax on high-cost employer health insurance plans that hasnt taken effect yet. And it temporarily suspended two taxes on industry already being collected, which are also part of the health law.

WASHINGTON >> Republican foes of President Barack Obama’s health care law may be able to get more by chipping away at it than trying to take the whole thing down at once.

That’s one lesson of the budget deal passed by Congress and signed by the president last week.

It delayed a widely criticized tax on high-cost employer health insurance plans that hasn’t taken effect yet. And it temporarily suspended two taxes on industry already being collected, which are also part of the health law.

In contrast to frontal attacks on “Obamacare” that have repeatedly failed, this tactic could well succeed. Delays and suspensions have a way of becoming permanent.

Polls show that the public remains deeply divided over the Affordable Care Act, or ACA. Opponents are already looking for other provisions that could be separated from the law.

Next could be the “employer mandate,” a requirement that larger companies offer coverage or risk fines. Part of the mandate is a controversial definition of a full-time worker as someone who averages 30 hours a week. Critics say it discourages companies from hiring full-time employees.

“Maybe Republicans have come to grips with the idea that the basic structure of the ACA has been in place long enough that simple repeal is not possible,” said economist Joe Antos of the American Enterprise Institute, a business-oriented think tank. Perhaps the budget deal “is practice” for more changes, he added.

Supporters of the health care law are trying to downplay the consequences of the budget deal as superficial dings. It did not touch coverage provisions that have reduced the nation’s uninsured rate to a historic low of 9 percent. Indeed, Obama himself announced that 6 million people have already signed up for 2016 coverage, with more than a month left in open-enrollment season.

“I think you can make too much of these particular things,” said economist Paul Van de Water of the Center on Budget and Policy Priorities, referring to the deal. “They don’t actually have any effect on the ACA’s coverage expansion. In that sense, it’s not a blow against the ACA at all.” The center advocates on behalf of low-income people.

Yet not too long ago a top White House adviser was vigorously defending the health law’s tax on high-cost coverage, known as the Cadillac tax.

The tax is 40 percent of the value of employer-sponsored plans that exceeds certain thresholds: $10,200 for individual coverage and $27,500 for family coverage. In its first year, 2018, it would have affected 26 percent of all employers and nearly half of larger companies, according to the nonpartisan Kaiser Family Foundation. Since the tax is indexed to general inflation, which rises more slowly than health insurance premiums, it would have affected a growing share of health plans over time.

Proponents of the tax, including many economists, see it as a much-needed brake on health care spending. But business and labor joined forces to oppose it. The budget deal delayed it two years, and its future is in doubt.

The spirited defense of the tax came from Jason Furman, chairman of the White House Council of Economic Advisers. “Repealing the tax or delaying its scheduled implementation … would have serious negative consequences for our health care system,” Furman warned in a speech Oct. 7.

Pulling back on cost controls in the health law would erode the wages of workers and add to government deficits, Furman explained, adding that “the administration opposes legislation that would repeal or delay this provision.”

Fast forward to a recent White House news briefing, when spokesman Josh Earnest seemed to soften that stance. While Earnest said the administration strongly opposed repealing the Cadillac tax, he didn’t address the notion of delaying it.

The health law’s employer mandate is the next likely focus for opponents, said Antos, the economist.

“The really large employers are not going to stop offering health insurance, since it’s an important benefit,” he said. “Even analysts on the left would agree that that mandate isn’t going to accomplish much.”

Similar to the Cadillac tax, the employer requirement raises concerns on both sides of the political divide. That could put the mandate into play when Congress again tackles a budget bill, or some other massive piece of legislation on which lots of trades get made behind closed doors.

The step-by-step approach has led to other health law changes. Among them:

— Repealing a long-term care insurance program that was financially questionable.

— Blocking a change in the definition of “small employer” after businesses argued it would raise premiums.

— Changing an income formula for determining who can get Medicaid. Originally, Social Security benefits would not have counted, meaning that some middle-class early retirees could have qualified for nearly free care meant for the poor.

— Limiting the administration’s ability to compensate insurers that signed up sicker-than-expected customers.

19 responses to “In budget deal, health law foes took a different path”

  1. stanislous says:

    But they promised I could keep my doctor and that my costs would not go up… Liar, liar, pants on fire.

  2. MoiLee says:

    Look at this picture? What do you see?

    • mikethenovice says:

      I should seen some puppy dogs.

    • Ronin006 says:

      The people in the picture look like the well-educated students at Yale University who recently signed a petition to repeal the First Amendment to the Constitution. They were totally ignorant about the Constitution and that the First Amendment guaranteed freedom of speech, religion and the press and the right to peaceably assemble and to petition the government. Yes, folks, a petition to repeal the First Amendment signed by our future leaders to ban the freedoms we hold so dearly. God help us.

  3. justmyview371 says:

    We need to get rid of all the bureaucratic fiascos impacting doctors and patients, including convoluted rules and regulations, requirements for expensive computer systems and software, reductions in physician payments and patient benefits, increased costs, and on and on. My doctors spend more time on their computers and paperwork, then looking at me, discussing my health problems, and examining me. The health system has been changed into a total morass by all the regulators and rule writers, and it must STOP. It is driving doctors to entire become hospital employees or simply retire. They can’t put up with the administrative overload. Paperer, paperwork, paperwork everywhere overloading the doctors and patients. I as a patient get so much paperwork from Medicare, the Part D provider, the insurance companies, etc. etc. that I can’t read it all and have no way of filing it. My time is also exhausted with the paperwork and taxes which take much more time than IRS estimates. I can’t pay for an accountant. Why has Obama done this to us?

  4. Ronin006 says:

    During the Democrat Presidential debate last night, all three candidates were asked what was wrong with the ACA and what would they do to fix it. None of them said what was wrong, but Hillary did acknowledge that premium costs and deductibles have skyrocketed and she has a plan to fix that. In typical Democrat fashion, her plan is to provide a $5,000 tax credit to those struggling to make their payments. In other words, if you can’t pay, the government will pay for you.

  5. mikethenovice says:

    The Republicans are the happiest when they see Main Street without any health care insurance coverage.

  6. justmyview371 says:

    The high-cost health plans are the ones rich or at least high salary employees receive. Some of the other health law changes are ones that helped the less wealthy middle-class. So these amendments just further the inequality between the rich and non-rich.

    • Ronin006 says:

      Justmyview, your view is partially correct. The high-cost insurance plans under Obamacare are commonly called Cadillac Plans. These may be the plans rich or high-salaried employees receive, but they also are the plans negotiated by unions for their members. There are about 15 million union members in the US, so it is reasonable to assume that the majority of people with the high-cost insurance plans are from the middle class, from which most union members come.

    • saywhatyouthink says:

      The cadillac provision (10K for individual) will soon affect regular people as well because it’s indexed to inflation which rises slower than medical costs. My employer already pays about 7K a year for my coverage. Once it rises above 10K, a 40% tax will take effect and my HMSA plan is far from being a cadillac in any sense of the word.

  7. saywhatyouthink says:

    The ACA has indeed reduced the number of people without insurance but at excessive cost to everyone else. When it’s effects are measured on the whole, it hasn’t improved the healthcare situation in this country at all, it’s only increased the costs for consumers, businesses and the government.It just didn’t go far enough with regard to insurance and drug companies. What we need is a single payer system similar to what nearly every other industrialized country in the world has and strong controls on drug company profits. The US consumer currently finances drug development and research for the entire world. This has to change, it’s a slap in the face to every american that we pay more for the same drugs than any other country in the world. The ACA has failed to accomplish almost every goal Obama said it would.

    • hawaiikone says:

      It’s fascinating to follow the trail of innovative drugs, with many major pharmas located in foreign countries. But one truism seems to repeat itself, namely the fact that the US discovers the large majority of the most effective and ground breaking drugs. The single payer systems you allude to have long benefited from that fact, without which the extremely high cost of research investment necessary to discover these medicines would more than likely have not been made by any single payer nation. So you may be right that by joining the ranks of single payers we as a nation might see our health costs go down, but not without the potential price of a reduced inflow of advanced medicines.

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