You should have been smarter than this, Wisconsin.
Sen. Ron Johnson (R-WI), in an attempt to save his Senate seat next year, has come up with what is likely to be the plan his Republican colleagues settle on to "fix" Obamacare if the Supreme Court decides to gut subsidies. Johnson's plan would allow subsidies to the affected states to continue into 2017, after he may or may not be successfully re-elected, and then end. Except it turns out that his legislation doesn't just end the subsidies in the states using the federal insurance exchange. It ends all of them.
Specifically, the bill would:
- Eliminate marketplace subsidies for new enrollees in all states—including states with state-based marketplaces that otherwise would be unaffected by a Supreme Court decision. As a result, people in states with state-run marketplaces whose incomes decline in the future, making them eligible for subsidies under the ACA, would indeed be shut out. In addition, existing federal marketplace enrollees would lose their subsidies after August 2017. […]
Thus, in addition to ending subsidies by August 2017 for the 6.4 million people now receiving them who purchased coverage through a federal marketplace, the bill would bar millions of people who haven't enrolled yet through a marketplace from obtaining subsidies even if they reside in a state with a state-based marketplace.
Cutting off subsidies for new enrollees would have a widespread, immediate impact on the marketplaces. New enrollees constitute a significant portion of the expected marketplace enrollment for 2016; research indicates there is significant "churn" into and out of marketplace plans, even within a given year, due to changes in families' income, size, and employment. The Urban Institute has estimated that in any given year, well over one-third of subsidized marketplace enrollees will move into other sources of coverage and be replaced by new marketplace enrollees who previously were eligible for Medicaid or otherwise ineligible for subsidies. As a result, if new marketplace enrollees are barred from receiving subsidies, marketplace enrollment will begin to dwindle fairly quickly.
In addition to that, it repeals both the individual and employer mandates. Which means that more people will choose not to be insured, because of course they can't afford it because they'll no longer have a subsidy. Which means that premiums will go even higher as there are fewer people in the larger pool paying into the system. About 85 percent of the people who have health insurance through Obamacare receive subsidies. At least 6 million of them are now in jeopardy of losing their coverage because of the
King lawsuit—those are the people living in the 34 states using the federal exchange. But if Johnson prevails, by 2017 millions more will be in that position.
Once again, this bill is veto-bait. It's not clear that it could actually be accepted by House Republicans, since it purports to "fix" Obamacare instead of simply repealing it all, but leadership might prevail upon them to accept it for strategic purposes. If they pass something like this, President Obama will veto it and we're back where they're all most comfortable: blaming Obama for the mess they created in their unending opposition to Obamacare.