Editorial March 24, 2017



It would be okay to describe the activities on the Hill and the White House regarding the repeal and replace of the Affordable Care Act with the American Healthcare Act as the way it goes when major legislation is being considered. While it is that it is more so something else; it is an in your face presentation of the classic conflict between Liberal and Conservative thinking when it comes to providing or not providing healthcare to the taxpayers. But it’s even more than that – the delay in getting the AHCA to the floor by House Republican Leadership has a bit to do with opposition from the Minority but the real problem is warring factions within the House conservative caucuses themselves.

It is a pretty safe bet that the delays and frustration House Leadership is enduring as it scrambles to get enough votes from its own party to pass the bill and send it to the Senate are from within the Majority Party. For those who do not like the AHCA because it, in its current form, reduces the number of people with health insurance coverage the argument is simple. It may seem as the bill is unacceptable for that reason even to conservatives and therefore they share the same complaints about those losing coverage but that would not be true.

Granted there are Senate Republicans who objected to the bill’s cuts resulting in fewer covered in their states but that is a problem that should look for a solution in the process through which the Senate amends the bill and sends it back to the House where a Senate / House conference irons out the details.

The bill’s problem is in the House where, other than Democrats, the warring conservative parties are looking for further cuts to the Medicaid provisions in the bill. That is what held the bill up in the House and, even if the regular order takes the bill through the Senate and then to a conference, the opposition wanting further Medicaid cuts is deeply entrenched.

When we look at the generosity of the Affordable Care Act despite 8 years of Republican vilification and, frankly, outright lies about the bill (remember the death panels argument?) and compare it to the American Healthcare Act it is pretty easy to conclude that ideology is at play here, not thoughtful consideration of the taxpayer needs.

Referring to a phrase common in Brooklyn, New York regarding House Leadership stumbling through the vote-getting process; glad I’m not them. To be them I would have to be supporting legislation that handles healthcare on the cheap knowing that there are unidentified people out there who will suffer or die if the Medicaid cuts are enacted.

There is an old saying on the Hill that if you find yourself in a hole, stop digging but House Leadership continues digging with the Resolution proposed to govern debate on AHCA (HR 1628). They are aiming to pass from the Rules committee a rule that would waive the rule requiring a two-thirds vote to consider a rule on the same day it is reported from the Rules Committee against any resolution reported from the Rules Committee through the legislative day of March 27, 2017. What this means is that Leadership is uncertain of the votes needed to pass the bill, wants to introduce a rule that would limit or prohibit debate in some form (no amendments). It also means that this matter may continue through the weekend including Sunday, March 27th.

Expansion of Medicaid solves a whole lot of problems for States and individuals seeking or providing healthcare, respectively. It helps meet the needs of the Nation’s most vulnerable and most in need. Ironically, non-expansion States, those States that did not take the Medicaid expansion from the ACA, will get some more Medicaid money under this bill while expansion States can only look to the future of trying to do what they do for the ill, poor and elderly with less money.

That convoluted result should come as no surprise but rather typical of an effort to make a sow’s ear look like a silk purse. Republicans need to drop this approach, stop digging the hole, but they can’t because the ideological conflicts that have made passing the bill untenable are unyielding. In a perfect world the best approach to providing healthcare to taxpayers is to meet the needs of the beneficiaries to the extent that the demand for that care will diminish over time because they got the care they needed and are healthier.

Just Keeping Track

A modest calculation of the cost of flying Air Force One from DC to West Palm Beach where the President visited each weekend of the first month or so in office is $1.5 million for the round trip. The total spending at that time was $10.5 million. Since then the President has made several more trips to Palm Beach as well as campaign trips to Nashville, TN and most recently Kentucky (yes, they were campaign trips because the President registered with the FEC to run for president in 2020).

The total now stands at $15 million and if he retreats to Mar-a-Lago after this trying week of healthcare negotiations the total will add up to $16.5 million. These trips to ‘the Winter White House’ as he often refers are unnecessary and while presidents do make campaign trips it is usually after the second year in office.

At this rate and not including campaign trips the President will rack up $78 million in taxpayer dollars in his first year in office.

Former CBO Head Elmdorf on the American Healthcare Act.

March 16, 2017

Thank you. I’m pleased to be here today. The health care legislation supported by the House Republican leadership would take our country backward, not forward. It would do that in at least 4 important ways:

First, the legislation would entirely reverse the progress of  the past several years in expanding health insurance  coverage in this country. The number of uninsured Americans under the age of 65 was 50 million in 2010, is 26 million today, and would be 52 million in 2027 under this legislation, according to CBO’s projection. That is a doubling in the number of uninsured Americans. To be sure, CBO’s projection is probably not entirely accurate, just as CBO’s projections for the Affordable Care Act were not entirely accurate. But there is no evidence to suggest that the government could cut subsidies through the insurance marketplaces in half and make unprecedented cuts in Medicaid without dramatically increasing the number of Americans without health insurance.

Second, that dramatic increase would *not* primarily be a result of people having greater freedom to choose to be uninsured; it would primarily be a result of people not being able to afford health insurance. Yes, the elimination of the penalties for not buying health insurance would cause a sharp decline in insurance coverage in the next few years. But the 50 percent cut in the average subsidy in insurance marketplaces would greatly reduce the *affordability* of insurance. And the projected loss of coverage in the long run is concentrated in people who would *lose eligibility for Medicaid*. If you lose eligibility for Medicaid, you are not *deciding* to become uninsured; you are losing your access to health insurance and affordable health care. The evidence is clear: The bill is not as much about giving people more choices as about taking away their existing opportunities.

Third, the removal of opportunities in this bill would not represent shared sacrifice for the national good but rather targeted sacrifice by lower- and middle-income Americans.

The government currently subsidizes health insurance and health care for nearly all Americans — support provided under the ACA, but also support for elderly Americans through Medicare, for some lower-income and disabled Americans through Medicaid as it existed prior to the Affordable Care Act, and for 150 million Americans who receive health insurance through their employers and can exclude that insurance from their taxable income. Those *tax* provisions provide most of their benefit to *higher-income* Americans — 34 percent to Americans in the top quintile of the income distribution and only 22 percent to Americans in the bottom *two* quintiles put together, according to CBO’s estimates several years ago.

The Republican bill would not scale back all of the existing tax subsidies in a way that shares the burden. Instead, it would leave the tax subsidies for higher-income Americans fully in place and clobber the tax subsidies — and spending subsidies — for lower-and middle-income Americans.

Fourth, the legislation would take us backward by providing a large tax cut focused on the very top of the income distribution. We know that many Americans across most of the income distribution have benefited relatively little from the growth of overall national income during the past several decades, while people at the top of the income distribution have done very well. Indeed, a central theme of last year’s election campaign was the importance of government policy focusing more effectively on the needs of people who are not the economic elite. Yet, the one percent of households with the highest incomes would receive 40 percent of the gains from repealing the tax increases under the ACA, according to estimates by the Tax Policy Center.

Are there other advantages of this legislation that would offset all of those ways in which the legislation would take our country backward? No. There is no need to make dramatic changes to the ACA. Although the insurance marketplaces are not attracting as many enrollees as many of us would like, they are not in a death spiral, and the competition among private insurers in the marketplaces could be strengthened through modest policy changes. In addition, the vaunted deficit reduction from this bill represents just a few percent of projected deficits under current law. Certainly, every bit helps, but this bill is not a significant part of a true deficit-reduction strategy. Moreover, the small reduction in average insurance premiums in the long run from this bill would occur largely because average out-of-pocket costs would rise considerably and because older Americans, who need more health care, would be less able to afford insurance and therefore would not be in the risk pool. Those are hardly accomplishments to write home about.

So, why is this legislation on the table now? Why is it the most important priority for House Republicans? I’m baffled that anyone could have watched last year’s election campaign, seen the frustration and anger of many working Americans, and concluded that the most important thing they could do for our country is to make health care unaffordable for tens of millions of Americans of modest means who can afford care now while cutting taxes for the richest Americans.

In some ways, the Administration seems to understand this point. The President promised not to cut Medicaid benefits and said that “everybody’s going to be taken care of much better than they’re taken care of now” and “the government’s gonna pay for it.” The Secretary of Health and Human Services said “Nobody will be worse off financially.” The Secretary of the Treasury said “There would be no absolute tax cut for the upper class.” Without a doubt, all of those promises would be broken by this legislation.

Foreign Affairs

Russia / Syria

“Russian President Vladimir Putin is leveraging Russia’s position in Syria to further diminish U.S. influence in the broader Middle East and North Africa. Russia will increasingly constrain U.S. freedom of maneuver in the broader region by expanding its military footprint and its anti-access and area denial zone. Putin advanced his regional strategy from February 27 to March 20, 2017 in three ways. First, he promoted economic relationships with key U.S. allies, including Egypt and Iraqi Kurds. Russia and Egypt reached tentative agreements to establish a Russian industrial zone in the Suez Gulf area and to resume Russian flights to tourist destinations in Sinai. Russia also renegotiated its oil agreement with the Kurdistan Regional Government on February 28. Second, Putin…” ISW

Russia / China

“Russia and China are effectively using tools as old as propaganda and as current as viral social media messaging to sow distrust abroad and split alliances to gain their way, three expert witnesses in a new age of conflict told the House Armed Services Committee. Frank Hoffman of National Defense University said Wednesday these “gray zone measures” and also called hybrid warfare, would include aircraft buzzing warships and turning reefs into militarized islands was in a way “a return to Cold War tactics.” Other autocratic regimes employing these measures include Iran and North Korea. “We’re prepared for the violence” of conventional and nuclear warfare, but “not ready for the indirect” attacks that can undermine alliances and partnerships. Russia’s efforts to split Sweden and Finland…” US Naval Institute – John Grady

Russia / Libya

“The head of Libya’s United Nations-backed government, Fayez al-Sarraj, undertook an official visit to Moscow to meet with top Russian diplomats and officials March 2-3. Russia has been stepping up efforts in Libya, which seems baffling outside the wide regional context. There is a popular opinion that Russian foreign policy, including planning in the Middle East, may sometimes be tactically impeccable but lacks strategic thinking. Some believe that unpredictability has been a hallmark of the Kremlin’s foreign policy.  Russia’s revived interest in the Middle East goes back to Vladimir Putin’s second presidential term (2004-2008), and for a long while the authorities have focused on economic development and the need for most diversified economic ties. Their attitude has been typified by blunt pragmatism.” Al Monitor

Magic Mondays

Political Ideology