Don’t Take Skinny Repeal Lightly — The Dangers of “Just Pass Something” Mentality

Marc Stier |

As I write this, the Senate is moving in a somewhat haphazard way to a vote on what has been called a “skinny” repeal of the Affordable Care Act. Not only do we not know exactly what will be included in the skinny repeal, but we, like members of the Senate, are uncertain about the point of passing such a bill.

 

Skinny Repeal as Trojan Horse

Most observers of the Senate believe that the goal of enacting a skinny repeal bill is simply to keep the process of repealing, or repealing or replacing, the Affordable Care Act alive. If the Senate acts on some health care bill that is an amendment of the AHCA passed by the House, the next step will be a House-Senate Conference Committee, which would write a final bill that attempts to thread the very narrow needle between more moderate and more conservative Republicans in both the House and Senate. The bulk of the work of the committee would, likely, be carried out in private among Republicans only. The bill it produces would go back to the House and Senate where it would receive an up and down vote with no opportunity for amendments.

While we believe it will be very hard to write a bill that can win a majority in both the House and Senate, there is a very real danger that once a final bill is written enormous public pressure would be applied to Republicans in both houses to vote for the bill. And make no mistake, the bill would be terrible for Americans and Pennsylvanians. As we’ve pointed out, the basic structure of the Republican plan to repeal and replace the ACA can’t help but lead to more than 20 million fewer Americans, and 1.2 million Pennsylvanians, having health insurance.

So we urge Senator Toomey to oppose the plan — without much hope that he’s listening.

Skinny Repeal as Policy

There is another reason to oppose the skinny repeal bill — the House might simply embrace and enact it. And while we don’t know exactly what will wind up in the bill, it appears that it includes a repeal of both the individual and employer mandates. The consequences of repealing them would be a flight of healthy people from both the health care exchanges and individual insurance market. But as healthy people leave the insurance pool, it would leave folks who are sicker and more expensive to insure, which in turn leads more people to drop insurance and premiums to rise again. The ultimate result, according to the CBO, is that 16 million fewer people will have insurance and premiums will increase by 20%.

These numbers are so disturbing that, at the moment, at least Republican Senators have said they won’t vote for the proposal unless they have iron-clad assurances that, if it passes the Senate, the House won’t immediately take it up and pass it. Speaker Paul Ryan has released a statement that says he is willing to do that, but he offers no guarentees.

Skinny Repeal and Reconciliation

There is also some question about whether the skinny repeal proposal can be adopted under the reconciliation process, which requires the Senate health care bill to reduce the budget at least as much as the House bill. The problem is that higher premiums created by repealing the two mandates would lead to substantially higher federal spending as federal tax credits for those earning 250% of the federal poverty line or below would have to rise to offset higher insurance premiums in the marketplace.

That is not the only procedural barrier for skinny repeal. The Senate parliamentarian has already ruled that some of the provisions Senator McConnell wanted to add to the proposal to secure 50 votes, such as a repeal of some of the health insurance regulations in the ACA including the essential benefits rule, could not be included. Senate Rules require that legislation considered under the reconciliation process only include provisions that directly change federal revenues or outlays.

Updates

We will update this post as the Senate debate continues.

11:00 pm Update.

It appears the skinny bill has the features we mentioned above and a few others.

–It gives the states some flexibility to waive the requirements that all insurance provide all essential benefits and does not charge higher premiums for those with pre-existing conditions. (We still do not konw how this can be allowed under the rules for reconciliation.)

–It increases the limits for  health savings accounts which mainly benefits those with higher incomes.

–It delays the tax on medical devices for three years.

–It increases funds for community centers.

Paul Ryan has said he will go go to a conference committee to work out a compromise House-Senate bill rather than take the skinny repeal bill to the House floor for an immediate vote. He has not made an iron-clad promise to do so, however. It is not clear whether his statement will mollify enough Senators who remain opposed to the skinny repeal proposal but want to see the process of repealing the ACA continue with a conference committee.

 

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