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healthcare financing

Jonathon Cohn games out how the debt-ceiling deal, both the potential trigger and the Super Congress, could affect health care programs, and is most concerned about the future of the Affordable Care Act.

He argues that the triggers would likely be preferable to the Super Congress, since "President Obama and the Democrats largely shielded the big entitlements and programs from the poor," whereas everything is on the chopping block for the Super Congress. But there's a hitch.

But don’t kid yourself: The automatic cuts will still hurt, because they’d still affect plenty of important programs. And among them may be the administration’s signature legislative accomplishment, the Affordable Care Act.

The new health care law will make insurance more affordable by providing subsidies to people who buy insurance on their own. And these subsidies come in two forms. There are tax credits, which people can use to offset the cost of their premiums. And there are subsidies to defray cost-sharing: In other words, the government will help reduce people’s out-of-pocket costs. Under the debt ceiling deal, the tax credits are exempt from automatic reductions, because they are a tax credit and not a form of spending.

But, as both administration and congressional sources are confirming, the cost-sharing subsidies are not exempt. They will decline. And that’s worrisome because the subsidies were already pretty low. In fact, many of us were hoping that, over time, lawmakers would see fit to raise them rather than reduce them. I can't be sure how much the subsidies would decline, as nobody I’ve contacted seems to have run the numbers yet. And I'm not even positive how reduced subsidies would translate into reduced protection, since technically the subsidies go directly to the insurers. (I don't even want speculate about the impact until I know more. I’ll update this item when I do.)

This, needless to say, poses a potentially serious problem to the signature accomplishment of the Obama administration, and to the goal of covering 30 million currently uninsured Americans. Digby nails the threat:

First of all it allows them to start cutting into the ACA before it even gets started in the name of projected deficit reduction. It doesn't get any more abstract than that and the fact that the administration that is credited with the reforms signed on is a very ominous sign.[...]

The worst of all possible worlds will be if the Super Committee decides to hold the HCA hostage as a way to pass their own hideous agreement and put liberals on the hook again for the same program. (Maybe they can sneak in some anti-abortion nonsense at the end and we can all party like it's 2010.) I certainly wouldn't put it past the Republicans to play both sides of that argument. After all, they win either way.

Throw into the mix the possibility of the Medicare eligibility age rising, and take BTD's scenario: "Imagine you are 62, making $40,000 a year with employer sponsored health insurance. How are you feeling about the next 5 years?"

The potential damage isn't just to the Affordable Care Act and Obama's legacy: it's to the idea of health care reform and the future reforms that could build on what's been done so far. Politically, for real, expansive health care reform that extends not just access to insurance but actual, universal health care to happen, the Affordable Care Act needs to succeed, or no one will want to touch the issue for another few decades.

Originally posted to Joan McCarter on Thu Aug 04, 2011 at 03:07 PM PDT.

Also republished by Main Street Insider: Capitol Hill Coverage and Daily Kos.

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Comment Preferences

  •  It just shows how much Obama values (4+ / 0-)
    Recommended by:
    RaulVB, Shahryar, Marie, Terra Mystica

    his "signature accomplishment" that he would put it in jeopardy for the sake of political positioning.

    •  like the unemployment benefits (4+ / 0-)

      we have the good cop/bad cop game where Democrats take turns being awful, then later take a good position so they can showcase the good one when they run for re-election.

      Here, too, we have the shock doctrine thing where some chip of value, but not overwhelming value, is given to us as if it's vital. And then, later, we give it back in order to get something else passed.

      We let the Bush millionaire tax cuts survive so we can get unemployment benefits extended, only to give up those benefits in order to raise the debt ceiling (which for the first time ever is in doubt).

      So sure, we'll give up the good parts of the insurance bill in order to preserve whatever it is they're telling us is preventing a "complete financial meltdown!!"

      "Things are never so bad they can't get worse" - Dallasdoc

      by Shahryar on Thu Aug 04, 2011 at 03:37:00 PM PDT

      [ Parent ]

    •  At this point (1+ / 0-)
      Recommended by:

      I really don't care if Obama's HCR get's trashed.

      I think it would be better to start over later than accept this give away to the Insurance Industry.

      Honesty pays, but it doesn't seem to pay enough to suit some people. Kin Hubbard

      by Mr Robert on Fri Aug 05, 2011 at 08:51:41 PM PDT

      [ Parent ]

      •  Really? (0+ / 0-)

        Because it doesn't look like starting over is an option.  So what you're really saying is that you'd rather we get nothing than get HCR that is less than ideologically pure.

        While Obama's HCR legislation was certainly imperfect, it still will help many millions of people if it is allowed to go fully into effect.  In contrast, if it's repealed, we'll either just revert to the prior status quo or we'll get some version of Republican "market driven reform" -- which loosely translates to higher deductibles and more people without insurance.

        Or to put it another way:  I think you're an idiot.

        Political Compass: -6.75, -3.08

        by TexasTom on Fri Aug 05, 2011 at 10:21:11 PM PDT

        [ Parent ]

    •  how sad is it that (2+ / 0-)
      Recommended by:
      Palafox, Massman

      the "signature accomplishment" of the Democratic Party is . . . . Romneycare.

    •  NONSENSE! (0+ / 0-)

      It just shows that America's political apathy is deadly--literally.

      Those of us who know what's going on have a moral imperative to get out the vote in 2012. Griping about what Obama couldn't do (and stupidly pretending you can read his mind) is useless and self-defeating.

      Stop whining and start getting out the vote.


  •  Uh...can we call Armando by one (1+ / 0-)
    Recommended by:
    Geekesque are confusing me ;)

    "But once John Boehner is sworn in as Speaker, then he’s going to have responsibilities to govern. You can’t just stand on the sidelines and be a bomb thrower." - President Obama, 12-07-2010

    by justmy2 on Thu Aug 04, 2011 at 03:18:01 PM PDT

  •  Debt Ceiling "Deal" = 500 points market drop (3+ / 0-)
    Recommended by:
    Geekesque, mos1133, Terra Mystica

    Personally, I think that tomorrow could be a disaster for Obama.

    He really screwed this one up.

    •  Or it could be the wakeup call (3+ / 0-)
      Recommended by:
      mos1133, RaulVB, Terra Mystica

      he desperately needs.

      He NEEDS to point out that job creation is an urgent necessity now.

      For no other reason, people need a reason to hope that the economy could get better.

      "[R]ather high-minded, if not a bit self-referential"--The Washington Post.

      by Geekesque on Thu Aug 04, 2011 at 03:37:57 PM PDT

      [ Parent ]

    •  What, exactly, do you think Obama could have (1+ / 0-)
      Recommended by:

      done differently? I can think of several things he could NOT do, forcing his will on the House of Representatives being one of them. But, since you seem to be sure he "screwed this on up," please say exactly how and exactly what he should have done differently.

      Men never do evil so completely and cheerfully as when they do it from a religious conviction. -- Blaise Pascal

      by RJDixon74135 on Fri Aug 05, 2011 at 08:12:08 PM PDT

      [ Parent ]

      •  he could have done what every other Prez did (4+ / 0-)
        Recommended by:
        Mr Robert, myeye, Palafox, Massman

        and signed nothing other than a clean bill to raise the debt limit, period.

        If you read the FP yesterday, you know what most of us already knew back then; the Repug leadership didn't want a default and wouldn't have allowed one---and the Bagger nutjobs who DID want a default didn't have the votes to make it happen. The Tea Party Caucus has even fewer members than the Progressive Caucus does.

        There never really was any hostage.

        And it's worth repeating that this isn't about Obama and never was. Obama is not the problem. The problem is that the Dems are not a progressive party--or even a liberal one--and have zero interest in passing any of our agenda. If we kicked Obama out tomorrow and dug up the bones of FDR instead, nothing would change. The Dem Party doesn't want a progressive agenda because it simply is not a progressive party.  And therein lies our problem.

        The Dems didn't cave in or surrender--they got exactly what they wanted.  Alas, what they want bears no relationship to what WE want.  The Dem Party is Repug-Lite, not liberal/progressive.

      •  Again and again and again: (0+ / 0-)

        "What, exactly, do you think Obama could have differently?"
        The sane among us ask it.

        And the whiners, so embarassingly like Tea Partiers, continue to pretend to read minds and be experts on the inside track of D.C.

        Luckily, the left whiners AND the right whiners do NOT represent the majority.

        Not even when their numbers are combined, thank God.

  •  Is this right? Credits are refundable, subsidies (0+ / 0-)

    not realized (= out of pocket) deductible but only to the extent it lowers income tax to zero?

    IOW: If I owe $200 in taxes, I can get a $500 credit as a $300 'refund', and if I paid $2000 out of pocket (and unsubsidized) I can deduct it (with limitations) from my income so that I owe less than the $200 in tax - but if, e.g., I owed no tax anyway, the subsidy is meaningless.


  •  This is what we should be pushing for: (0+ / 0-)

    more tax credits then.  

    the tax credits are exempt from automatic reductions, because they are a tax credit and not a form of spending.
     Everyone loves a tax cut don't they?  As progs/dems we should be pushing our elected officials to cut taxes by giving our seniors more tax credits to help them pay for medicare.
  •  I'd be more likely to buy to care (3+ / 0-)
    Recommended by:
    mos1133, Clem Yeobright, tmo

    If it weren't for this:

    Politically, for real, expansive health care reform that extends not just access to insurance but actual, universal health care to happen, the Affordable Care Act needs to succeed, or no one will want to touch the issue for another few decades.

    You can't have it both ways, folks...

    If Medicare is to become the foundation for a universal health care system - it cannot continue down this path.

    Like many people, I saw and continue to see PPACA as just one step down a long road.  It was about reigning in the insurance industry, at least -- bringing them (however loosely and incompletely) under a nationalized umbrella.  I'll grant it wasn't perfect, but it did institute plan minimums, MLR requirements, and a whole host of other measures that are essentially designed to normalize insurance across the population.

    The next lever that needs pulling is taking a look at actual provider costs.   Even if you took all aspects of private insurance out of the system, our methods of care are far more expensive than any other nation -- and that's most extremely true when it comes to IPPS.

    That has to be brought under control and since we continue to have a private provider model, that means using Medicare to do that is our only option... and it's actually not a bad option.  It's the largest payer in the nation and it sets the rates upon which other carriers start from.

    I'll grant that can't happen in a vacuum either -- you've certainly got to do something about physician educational debt load, and you've also got to be very careful that the haircuts are focused on the facility/IPPS area while actually helping out the family and solo practitioners.... but we're getting screwed - Medicare is getting screwed - by an IPPS system that has learned how to game the program.

    A good start would be to stop being AHA mouthpieces; stop aiding and abetting GOP oversimplification that "Cuts are cuts"; and instead -- give serious examination to the evidence...

    We - through Medicare alone - pay too much for too many services that have dubious, if not non-existent, positive impacts on beneficiary health.... and it's not all simple upcoding or phantom claim fraud.

    Medicare is powerless to fix these things unless the program is modified to do so.

    We can - and should - start small and in very targeted ways.... but when CMS's own actuary estimates that Medicare wastes 75 to 150 billion per year on unnecessary services, it ought to be universally agreed that this needs fixing.

    Anyone that believes in single payer is foolish to expect that that we can take a 500 billion program with an estimated 15-30% waste and just expand it without first trimming that waste out of the program.

    Full Disclosure: I am an unpaid shill for every paranoid delusion that lurks under your bed - but more than willing to cash any checks sent my way

    by zonk on Thu Aug 04, 2011 at 03:31:24 PM PDT

  •  Wasn't defunding "Obamacare" (3+ / 0-)

    one of the teabaggers goals?  Weird that so few Democrats/liberals expected them to limit themselves to using the front and locking that would thwart them.  But that back door was ever so much better than they could have expected -- now with the support of Democrats they can also chip away at Medicaid, Medicare, and Social Security.   Tried and true good deals will now be sacrificed for the failed effort to protect a bad deal.

  •  it's a shell game! (3+ / 0-)

    it's one of those "just give me a twenty and we'll be even" con!

    That means it's a classic.

    "Things are never so bad they can't get worse" - Dallasdoc

    by Shahryar on Thu Aug 04, 2011 at 03:52:43 PM PDT

  •  Perhaps hitting bottom is our only salvation (1+ / 0-)
    Recommended by:

    If so, we still have a ways to go.

    Make sure your seat belt is fastened low and tight across your lap, and keep your hands inside the moving vehicle at all times.

  •  Sometimes I wonder (1+ / 0-)
    Recommended by:

    how bad it has to get before things change.

  •  Either way we are fucked (2+ / 0-)
    Recommended by:
    mightymouse, Palafox

    I try not to use obscenities, but look at our leaders. The teabaggers are __ (insert here). The Republican leadership is __ (insert here). The WH is ___ (insert here). I have run out of adjectives, and anything I say is bound to offend someone. And what galls me is that even now the bobbleheads on teevee are circling the wagons around their respective candidates. To the MSNBC crowd the WH can do no wrong, to the FNC crowd the teabaggers are manna from heaven, while the US economy goes down slowly like the Titanic.

  •  It will be important, again, for all of us to (0+ / 0-)

    remember -- in detail -- that we have the most expensive health care system in the world but far from the best outcomes as measured along almost any dimension, the availability of for-profit MRIs and cancer treatment excepted.

    We need to be able to defend the most important messagee -- that the ACA will LOWER health care costs for Americans in the long run.

    I admit that I can't remember all those details any more, but I know I can dig them up and do my part. Please do the same.

    Men never do evil so completely and cheerfully as when they do it from a religious conviction. -- Blaise Pascal

    by RJDixon74135 on Fri Aug 05, 2011 at 08:01:48 PM PDT

  •  I'm shocked, shocked. (1+ / 0-)
    Recommended by:
  •  And, to use the cliché, "the rich get richer" (0+ / 0-)

    "and the poor get poorer"

  •  (shrug) "Progressives" wanted to kill it anyway. (0+ / 0-)

    So no big loss, RIGHT?

    Just like teabaggers did.

    Kevin dropped his ice cream and blames Obama? He's gone hamsher!

    by punditician on Fri Aug 05, 2011 at 08:03:58 PM PDT

  •  Obama's legacy (1+ / 0-)
    Recommended by:

    is already dust if there ever was one beside betrayal

  •  This was such a debacle. All the way around. (3+ / 0-)
    Recommended by:
    blueoasis, Massman, irmaly

    Dems will pay for this for years to come.

    Will Republicans pay for it? I doubt it, it's what they've wanted and advocated for thirty plus years.

    This is a crisis I knew had to come, Destroying the balance I'd kept. Doubting, unsettling and turning around, Wondering what will come next.
    --Ian Curtis

    by jethrock on Fri Aug 05, 2011 at 08:11:52 PM PDT

  •  The entire political universe revolves around (1+ / 0-)
    Recommended by:

    the word, "but."
    Their side; our side...BUT!

  •  If some folks really want a balanced budget, they (2+ / 0-)
    Recommended by:
    Nailbanger, blueoasis

    seriously need to consider single payer health care.

    Would love to see more unemployment in the insurance and pharmaceutical industries, and greater health all around.

    •  I just dont understand why business (2+ / 0-)
      Recommended by:
      SingleVoter, akmk

      real business, doesn't clamor for this.  Why do they want their HR departments spending so much time on it, why do they want the yearly meeting to stuff more expensive and less coverage down their employees throats?  Why do they want the inefficiencies that make them uncompetitive on the world stage. They should be lobbying for single payer more than anyone.

      •  many of them are (2+ / 0-)
        Recommended by:
        SingleVoter, Nailbanger

        Several of the large industry groups have been lobbying for years now for government-run health care, for precisely the reasons you cite.

        It's not corporate interests that prevent the GOP from allowing single-payer---it's the libertarian antigovernment ideology of the GOP that does.

        It's another reason why the corporados have abandoned the GOP in droves, and why for the past three elections the majority of corporate money went to Dems, not to Repugs.

      •  Control (1+ / 0-)
        Recommended by:

        If employees weren't dependent on benefits from the company, they would be freer to move on to better job opportunities or even (gasp!) becoming entrepreneurs.  Benefit ransom is a great way to control people.  How many folks do you know are stuck at a job they hate, because they need the benefits?


        by LordMike on Fri Aug 05, 2011 at 09:59:11 PM PDT

        [ Parent ]

  •  Are you telling me the GOP won the negotiation? (2+ / 0-)
    Recommended by:
    Palafox, irmaly
  •  Really! (1+ / 0-)
    Recommended by:

    First: Lets be real, this is and never was healthCARE reform, it is health Insurance reform.
    Second: As someone already mentioned, defunding Obamacare was a stated goal, score another one for the bad guys.
    Third: Who could have possibly seen this coming?
    Fourth: Time to punch some more hippies, it's worked so well so far.

    Proud member of the pony-tail wing of the Democratic party since sometime in the 70's

    by Desperado62 on Fri Aug 05, 2011 at 09:03:25 PM PDT

  •  Same old story (2+ / 0-)
    Recommended by:
    ZedMont, SingleVoter

    The one part of hcr absolutely guaranteed to survive is the mandate. Bottom line- if it benefits normal people it is on the table, if it benefits the overlords it isn't. Pretty simple really.

  •  This message is to ideologists. It's not just wha (0+ / 0-)

    t you believe; it's about how you govern.  To govern in the best interests of the country, you have to think about how you govern and what are the consequences.  Since the debt ceiling vote, I have received "explanations" of their NO votes from Senators Jeff Merkley and Bernie Sanders.  It's whining that says, I voted NO (like I thought you would want since you are a liberal Democrat), now give me money to pay for it.  If they had to get to a NO vote, they didn't do enough to prevent it.  They didn't do anything before and their emails do not address what they will now do.  To me, that is just whining, being ineffective, and not worth their salt as Senators.  It was bad enough to let the debt ceiling get to this stage.  All that time they were sitting on their hands, they were not even thinking about how they are going to govern their way out of the consquences.  They are part of the problem.  They are not part of any solutions  They can say what we need to have instead, but they are not recommending a single action as to how to get there.  They were willing to sell the US down the river on the debt ceiling, they were willing to sell the US down the river on when and how they got to the point of having to vote on that bill.  Now, it's a whine and shine philosophy.  I whine and you shine my shoes (contribute to my getting re-elected).  Nonsense!  The nerve of those guys...they are no better than their tea party con-patriots.
    I have a message for them:  Your emails to me had better say what you will do and how you will act to bring jobs on a large scale to this country.  That's the only way to get revenues now.  Now get busy!

  •  And the right will say that it is all (0+ / 0-)

    about entitlement spending.

    We need to point out that countries that still have AAA+ ratings like the UK, France and Canada all have a better safety net than this country.  So why can't this country manage to do it.

  •  More realistic scenario (0+ / 0-)

    Imagine you are 62, working an assortment of part-time gigs and free-lance work, without employer-provided health insurance, with income under $30,000 per year. Oh, and you have a health history (don't we all by that age?), so buying an individual plan would cost something like $9,000 a year.

    I believe that Obama is willing to raise the Medicare age because he truly believes that by 2014 the ACA will enable everyone to get affordable and adequate health insurance, so it won't matter. That's the only rational explanation for why he and Lieberman and the other proponents don't understand how anyone could be scared out of their mind by this proposal.

  •  But of course! (0+ / 0-)

    That's why only a single payer system will work.  It's impossible too cut without hurting everyone and that is too large of a political price.

    "The real wealth of a nation consists of the contributions of its people and nature." -- Rianne Eisler

    by noofsh on Sat Aug 06, 2011 at 06:29:15 AM PDT

  •  If you can't even get the governor of (0+ / 0-)

    Bible-banging Kansas to attend your prayer meeting, you've been pwned.  In this case you've pwned yourself.

    The community of fools might be small were it not such an accomplished proselytizer.

    by ZedMont on Sat Aug 06, 2011 at 06:31:16 AM PDT

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