Analysis: How Republicans Can Finally Repeal and Replace Obamacare

Posted: Nov 18, 2016 2:01 PM

One of the unambiguous promises Republicans made to voters is that if elected, they will repeal and replace Obamacare. They are right to have done so. The law is enduringly unpopular, is harming more people than it's helping, is raising costs even for consumers mostly insulated from the dysfunctional Obamacare market, and is generally collapsing under its own weight. In the latest development that portends more dark things for the law, early indications do not point to needed improvements in enrollment figures:

A little more than 1 million people renewed health coverage or signed up for the first time through around the start of open enrollment, which coincided with a GOP election sweep that’s likely to scramble President Barack Obama’s signature law. The figures released Wednesday by the Obama administration represent steady sign-ups but no enrollment surge so far. The overall number is fairly comparable to early sign-ups last year, but the share of new customers is down. They accounted for 24 percent of the total so far this year, compared with 34 percent in the first two weeks of last year’s open enrollment season. Nearly 1.1 million people had enrolled last year by about the same time.

What Obamacare needs is a major surge in new, young, healthy consumers who are willing to pay exorbitant costs to comply with the law's individual mandate tax.  Unsurprisingly, that is not happening.  Existing customers -- who comprise the current unsustainable risk pool -- are renewing at a faster clip than last year, but the pace of crucial fresh enrollees signing up has slowed.  In other words, the troublesome trends that have caused multiple major insurers to abandon the exchange, or massively scale back their participation, are continuing.  Other major players have also made clear that if things don't improve substantially, they'll also be heading for the exists.  So it looks like more pain is coming for American consumers, beyond these disastrous October developments.  This law is failing and must be scrapped and replaced.  Republicans must maintain this promise to the American people. The Congressional GOP has already established a blueprint for uprooting most of the law by using a parliamentary mechanism known as "reconciliation," which Democrats used to jam the law through in 2010.  Paul Ryan and Mitch McConnell got the job done in January, but their bill ran into an inevitable Obama veto.  Now there will be a Republican president who campaigned on ending the law.  

But that positive development doesn't mean that the process will be easy, politically or logistically.  What needs to come next is two parallel efforts: Repealing most of the law's central components with a simple majority in both legislative chambers (very doable, as already established), and replacing it with something better.  House Republicans campaigned on a sensible Obamacare alternative, some version of which the Trump administration is likely to embrace.  But installing a multi-faceted new program can't be achieved through reconciliation, meaning that those efforts could be derailed by Democratic filibusters.  There's a good chance that Senate Democrats would try to block votes on Obamacare replacement legislation while cynically and simultaneously attacking Republicans for 'taking healthcare away' from millions of people.  Republicans must be prepared for this likely contingency -- relentlessly highlighting victims' stories and reminding voters of several truths: 

(a) Democrats broke and fully own the Obamacare mess, (b) their law is empirically failing, with more disruptions and sticker shock coming, and (c) the GOP is honoring its pledge to end the bad law and install a vastly improved system in its place.  If Democrats refuse to allow votes on proposals to help the very people who have been betrayed by Obamacare (and some of the people who have benefited from it) in light of the new political realities, they alone will again be responsible for even more pain.  Major pressure should be brought to bear on the ten Democratic Senators up for re-election in 2018 who represent states carried by Donald Trump last week.  Meanwhile, Republicans should also make clear exactly how they intend to protect people with pre-existing conditions and previously "uninsurable" Americans under the new plan they're advocating.  Writing at NRO, Josh Blackman suggests one potentially potent way to force Democrats to the negotiating table:

In September 2009, when the ACA was being drafted, Senator Chuck Grassley of Iowa proposed an amendment requiring members of Congress and their staff to use the newly created Obamacare exchanges. “The more that Congress experiences the laws we pass,” Grassley said, “the better the laws are likely to be.” ...The Grassley amendment was extremely unpopular on Capitol Hill. There were rumors that House and Senate staffers would resign if they were forced to pay full fare for their insurance. It is beyond ironic that employees who labored to pass Obamacare threatened to leave government if they had to actually use it...Where Congress would not act, President Obama did so unilaterally. The Office of Personnel Management (OPM) announced that members of Congress and their staff would be able to purchase health insurance on the District of Columbia’s Small Business Health Options Program, known as the D.C. SHOP exchange...hus, there would be no meaningful disruption in benefits for Hill staffers...The OPM fix was a blatantly illegal effort to bypass an unpopular law...But now there’s a new sheriff in town. With the stroke of a pen, President Trump can direct his Secretary of the Office of Personnel Management to rescind the old policy.

Jam Democrats and their staffers with a hardball move that would introduce some real skin in the game. If they're going to refuse to help replace the defunct law, their own generous subsidies will go away. That's a powerful incentive, plus the maneuver would have populist appeal.  Although I also agree with Blackman's admonition against nuking the legislative filibuster, I disagree with his warning against repealing most of Obamacare through reconciliation.  Part of this is a game of chicken to some extent, and Democrats are only going to see the necessity of a replacement bill if Republicans have the guts to really, truly follow through on the repeal step (the timeline of the repeal's impacts could be tiered over time, as to avoid immediate shocks and outrage).  At the moment, it looks like Republican leadership is poised to deliver: