In an amazing display of optimism, Sen. Tammy Duckworth (D-IL) told reporters Monday that there will be a “handshake deal” on a reconciliation bill among Democrats by Memorial Day. You might also call that delusional, given there are just a couple of workdays for the Senate this week, and Sen. Joe Manchin (D-WV) has shown no signs that he’s ready to do something to help his colleagues.
“I believe there’s an opportunity, a responsibility, an opportunity that we can do something,” Manchin said on Monday. That’s not a whole lot to hang one’s hat on. Manchin might not like to acknowledge it, but his ongoing obstruction of President Joe Biden’s Build Back Better plan that Democrats are trying to resurrect is objectively hurting his own constituents in West Virginia and is going to keep on hurting them. It is making their lives and, making them more vulnerable to inflation, the thing he says is driving his opposition to the plan.
It’s also hurting Democrats politically, setting them up for a big cliff to topple over just before November’s election. As Daily Kos has been warning for weeks now, something like 14 million people who have been getting free or very inexpensive health insurance on the Affordable Care Act exchanges are going to be handed big Obamacare premium notices in October. Including in West Virginia. Working with data from Charles Gaba (Daily Kos’ brainwrap), Business Insider forecasted the potential damage.
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The beefed-up subsidies that these people have been receiving from the American Rescue Plan, which passed in March 2021, have helped achieve record enrollments and have saved people significantly. But the expansion expires this year (Democrats having assumed they could make it more permanent in the BBB framework when they included it in ARP) and the notices of new premium costs go out in October.
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“There’s no denying that if they are not extended, then there could definitely be a political impact,” Gaba told Insider. The looming disaster—which includes a likely hike in the uninsured rate—has plenty of experts worried.
Here’s where it hits Manchin, though. Gaba has calculated likely premium hikes around the country, using varied scenarios for age, income, marital status, and family size of enrollees. These are just estimates, but well-informed ones from one of the leading ACA data gurus in the country. He approximates the likely monthly premium increases for a 60-year old couple making $75,000/annually: West Virginia’s couple would see a $2,700/month hike; Georgia, $1200; Arizona, $942; New Hampshire, $777. In case you’re wondering, those last three states have Democratic Senate incumbents running for reelection.
The hit will be the hardest on people with higher incomes, many of whom just got access to subsidies with the ARP. “If you’re in that situation, you’d see all financial aid removed and your net cost would increase pretty dramatically,” Gaba told Insider.
But it’s also true that low-income Americans, especially those in states that didn’t take the Obamacare Medicaid expansion, will lose support. Those who make less than 150% of the federal poverty level are now paying as little as $0 for coverage. Those are individuals making less than $19,320/year or a family of four making less than $39,750.
It would seem that avoiding this big rate hike would be something every Democratic senator—even Manchin!—would want to avoid. The cost isn’t insignificant—CBO originally estimated the additional subsidies would increase the deficit $34.2 billion over ten years—but not extravagant. That’s something that could definitely be paid for with the tax hikes Manchin says he would support.
Among all the things that need to be nailed down in an agreement, this one has to be at the top of the list. The very last thing Democrats need in October is headlines touting and Obamacare failure on their watch. It’s also the last thing the 14 million people whose insurance coverage is in jeopardy need.
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