Opposing “Obamacare” Is Political Suicide For Downstream Republicans.

Posted on | January 30, 2024 | 1 Comment

Mike Magee

Despite Trump’s recent renewed pledge to once again take on Obamacare, most Republican leaders understand that opposing the increasingly popular program is political suicide. Experts have repeatedly advised the opposite, as we move slowly and incrementally toward “universalism in conjunction with simple source funding,”

A brief summary of the past history helps refresh our collective memories on the road we’ve traveled.

Medicare (a federal health insurance program covering all citizens over age 65) and Medicaid (a state and federal health insurance for poor and disabled citizens) date back to the original LBJ legislation in 1965. President Johnson had intended that the programs would be standard fare in all states. But to achieve passage, Democrats agreed to make the federal/state Medicaid program voluntary, and allow states to determine the details, such as income eligibility limits and work requirements. Medicare became the law of the land immediately, and Medicaid in some form was active in all states by 1982.

In 2010, as part of the Affordable Care Act (popularly termed “Obamacare”), President Obama included an expansion of Medicaid with conditions – that all citizens up to 138% of the federal poverty limit be eligible. In return, the added cost to the states would be paid for with federal subsidies of 100% until 2020 when they would become 90%. Under the original proposed legislation, states with diminished benefits and restrictions would be forced to comply with the new rules or lose their existing federal funding under Medicaid.

In 2012, 26 Attorney Generals from Republican led states filed a lawsuit to challenge Obamacare on two counts in an attempt to collapse the entire program. First, the “individual mandate” (an annual charge or tax on those who did not have health insurance) was targeted. Second, they attacked the constitutionality of the Medicaid extension.

The Affordable Care Act’s (ACA) mandate was an original component of Governor Mitt Romney’s Massachusetts law designed to insure that all citizens and organizations would participate and contribute to even risk-sharing. In the federal bill the mandate was the “stick” to counterbalance the various “carrots” of premium subsidies.

The petition against the ACA mandate became part of the landmark case – National Federation of Independent Business v. Sebelius, 567 U.S. 519 (2012). The argument for repeal of the mandate was based on the fact that the administration had justified the mandate as constitutional based on the Article 1 Section 8 – the Commerce Clause or Necessary and Proper Clause.

On June 28, 2012, Chief Justice Roberts disappointed fellow Republicans with a complex decision that split the difference.

As he stated in his closing: “The Affordable Care Act is constitutional in part and unconstitutional in part. The individual mandate cannot be upheld as an exercise of Congress’s power under the Commerce Clause. That Clause authorizes Congress to regulate interstate commerce, not to order individuals to engage in it. In this case, however, it is reasonable to construe what Congress has done as increasing taxes on those who have a certain amount of income, but choose to go without health insurance. Such legislation is within Congress’s power to tax.”

Roberts did, however, support Republicans on a their second issue. The Affordable Care Act had mandated that all states expand eligibility to Medicaid in return for a federal subsidy of 100% of the added expense until 2020, or risk loss of all existing federal Medicaid government funding.

The Court’s ruling : “As for the Medicaid expansion, that portion of the Affordable Care Act violates the Constitution by threatening existing Medicaid funding. Congress has no authority to order the States to regulate according to its instructions. Congress may offer the States grants and require the States to comply with accompanying conditions, but the States must have a genuine choice whether to accept the offer.”

As a result, states would have to voluntarily select Medicaid expansion under the ACA. Over the next decade, 40 states have signed up (the last being North Carolina in 2023), while 10 have not. The impact on uninsured numbers was almost immediate. States participating saw their uninsured rates drop and preventive health measures rise. States who chose not to participate and stayed with financial eligibility that was on average at 40% of poverty levels (rather than at 138%) lagged far behind on all measures.

For states opposing Medicaid expansion with federal subsidies, the decision proved costly. They were shown to spend more out of state coffers to support uncompensated ER care for their uninsured than the 10% contribution required after 2020. Yet they stubbornly held out in the hope of denying Democrats further victory as they celebrated states rights at a huge financial and wellness cost (higher mortality rates) to their citizens. The cost in dollars alone is increasingly difficult to justify. For example, Florida’s stubborn resistance left 1 million Floridians out in the cold, and cost the state $5.6 billion in immediate federal aid, and an additional $4.4 billion annually.

Over the past two decades, the numbers of citizens covered by Medicaid have grown substantially, from 40 million to over 90 million. The pandemic reinforced the critical role that Medicaid played in assuring Americans health coverage. On April 1, 2020, Biden signed the Families First Coronavirus Response Act which bumped up federal Medicaid subsidies for two years by 6.2% in return for a mandated freeze of Medicaid enrollee status in all states.

Medicaid numbers increased from 71 to 94 million during this period. That Act sunsetted on March 31, 2023, allowing states to disenroll citizens deemed ineligible. This “unwinding “ is viewed as potentially destabilizing, and states from Missouri to Texas, and Tennessee to Idaho, have been accused of shady practices in trimming their Medicaid rolls.

The ACA of course was not restricted to Medicaid enrollees. As part of the legislation, the Act also created subsidized “insurance marketplaces” nationwide, serviced by federally funded “navigators,” and made children eligible for parent’s insurance up to age 26, and prohibited insurers from disallowing coverage based on prexisting conditions. The popularity of these provisions contributed to Trump’s failure in 2017 to eliminate the ACA, with Senator McCann’s dramatic “thumb down.” Had Trump been successful, it is estimated that the number of uninsured would have increased by 32 million.

The pandemic and inflationary pressures allowed President Biden to expand the effectiveness of these markets. Increased federal subsides have lowered the cost to eligible consumers, as well as access, with eligibility now extended up to four times the federal poverty limit, or $120,000 a year for a family of four.

During the Trump years, from 2016 to 2020, enrollment in the health exchanges dropped 10% to 11.4 million as marketing and the use of navigators were all but eliminated. But in the following four years under Biden, enrollment skyrocketed by 87% to 21.3 million participants.That included 3 1/2 million Texans, and over 4 million Floridians.

Thirty-two states allowed the national HealthCare.gov to be their agent in the transactions, while 18 states chose to field their own websites.

If Obamacare was successful and popular, Bidencare is even more so. The original plan was plagued by an “ACA gap.” Medicaid for poor and disabled was hampered by deliberate state restrictions on access and work requirements, and Health Exchanges were underfunded with insufficient subsides to benefit middle income Americans. As a result, the poor were often underserved. And those with marginal incomes still made too much to qualify for ACA subsidies. By expanding Medicaid access and funding, while increasing eligibility to health exchange subsidies to 150% of poverty, President Biden has all but eliminated that gap, and enrollment has exploded.

So as Trump adds “eliminating Obamacare” to his campaign wish list, down stream Republicans best hope he’s just pulling their legs, and will soon go silent on the issue.