Some observations today about the new, John Boehner led House of Representatives. As promised (and discussed briefly in my last blog), House Republicans made their first order of business an overhaul of the House’s procedural rules that didn’t just amend the “pay-go” rule that dated back to Clinton (except for the 4 years the Republicans controlled the House under Bush), it eviscerated it.
Under the House’s new rules, any increase in discretionary spending cannot be paid for by a tax increase or new tax; rather, it must be offset by a corresponding decrease in some other discretionary program. So, if, for example, the House wanted to vote in a continuation of a program that enables low income families to receive a full rather than a partial Child Tax Credit, it could not pay for that by closing wasteful tax loopholes for multinational corporations that shelter profits on Caribbean islands. Continuing that program would count as an increase in spending, and hence could not be paid for by effectively increasing corporate taxes.
Here’s the pernicious part. Under the new House rules, tax breaks for multinationals could be expanded without offsetting that reduction in revenue by cutting spending somewhere else.
In other words, increased spending cannot be allowed to increase the budget deficit, but decreased revenue due to tax cuts can be allowed to do that. The GOP rationale for why deficit financing is OK if it’s caused by tax cuts but not OK if it’s caused by spending increases? Well, they actually haven’t produced one yet unless you count more voodoo economics about how making the rich richer grows the economy.
As Reuters News Service noted, “To simultaneously pave the way for both deficit-financed tax cuts for the wealthiest Americans and termination of critical tax-credit measures that keep several million low-income working parents and their children out of poverty represents a set of priorities that can aptly be described as worthy of Ebenezer Scrooge.” Merry Christmas America.
Then there’s H.R. 2, the new House’s second biggest priority. H.R. 2 is a bill that repeals ALL of the Affordable Care Act (the official name of the health reform legislation passed last year). The Sunday morning talk shows were awash last week with House Republicans brandishing their party’s two new catch-phrases—“job killing” and “big government”—in reference to what they derisively refer to as Obamacare.
Before taking a look at exactly what the GOP would get rid of, let’s understand one thing: the Affordable Care Act will actually make employer-provided insurance less expensive for all large businesses by lowering the ceiling on what insurance companies can charge in premiums. Small businesses with 50 or more employees will be required to provide insurance for their workers, but only if their workers haven’t gotten insurance on their own. Businesses with 25 or fewer employees will also have to provide insurance, but will receive federal credits of up to 35% for doing so. Republicans have long been good at the Chicken Little thing—the sky is falling—but here they are going that one better and arguing that the sky may not be falling yet, but it surely will. In point of fact, there is no empirical evidence to suggest that the employer insurance mandate of the Affordable Care Act will have any impact on jobs at all.
One of the big strategic blunders the Democrats made with health reform was phasing so much of it in over time. That gave the Republicans and their Fox News spokespersons lots of time to poison the public well as to what exactly was in the bill and create negative perceptions of it. In addition to calling it a job-killer, they’ve pointed to the 900 billion dollar cost of the bill over the next 10 years. What they’ve ignored—actually repudiated—is the non-partisan Congressional Budget Office letter they received early last week which told them the net effect of the bill on the budget would be reducing its deficit by approximately 235 billion dollars by 2021, and by something on the order of 1.2 trillion dollars in the decade following that. And the CBO numbers DO factor in the increased expenditures the bill requires.
Now think about this for a second. If the GOP were to succeed in repealing the Affordable Care Act, that would INCREASE the deficit by 235 billion over the next 10 years. Their new rules say that anything that increases the deficit must be paid for by reduced expenditure somewhere else. That would seem to create a conundrum for Boehner and the boys. A reality check has already caused them to back off their Pledge to America promise to cut 100 billion from the budget, but repealing AC A would require them to cut 235 billion. What’s a poor Republican to do? Not to worry. Page 26 of the new House Rules specifically exempts repeal of ACA from the “cut as you go” plan. Do you wonder sometimes how these guys can stand to look in the mirror?
Now let’s look at some of the things they would repeal.
Young adults, including adopted children and step-children, can remain on their parents’ plan until the age of 26. Previously, they came off automatically upon turning 19 or graduating from college.
Children under the age of 19 can no longer be denied insurance because of a pre-existing condition. By 2014, that rule will apply to all Americans.
People who have valid insurance plans when they get ill can no longer be denied compensation when they file a claim. Prior to ACA insurance companies regularly searched for any error or technical mistake in the original application and used any minor thing they found to deny compensation.
Patients now have an external appeal process for insurance company decisions. Prior to ACA, if an insurance company denied coverage or compensation, the only appeal was to the company itself.
Preventive care services appropriate to age must now be covered without a co-pay or deductible. These include tests for blood pressure, diabetes, cholesterol, cancer screenings such as mammograms or colonoscopies, osteoporosis, all routine vaccinations, and regular well baby and well child visits from birth to age 21.
"Wellness" checkups for senior citizens must now be covered.
The “doughnut hole” of Medicare Part D will be partially closed immediately and fully closed by 2020.
Out-of-network emergency room services must now be covered. Previously, if you needed emergency room care and the only hospital available was not in your plan’s network, the insurance company could require exponentially higher co-pays.
One very important aspect of ACA is that, as of January 1, insurance companies will be required to spend 80% of every premium dollar on actual health care. The almost immediate effect of that will be either lower premiums or rebate checks for insurance holders. This one is a major target of Republican congressmen because it strikes directly at their insurance company patrons’ bottom line.
Perhaps the most important thing that ACA does, and which the GOP would repeal, is essentially save Medicare. For the last 5 years at least, economists have been warning that the flood of baby boomers reaching Medicare age was going to cause Medicare’s insolvency in the very near future. The ACA addresses that problem in four very important ways—none of which will impact the low or middle income retiree. First, starting in 2012, the Medicare Payroll Tax (which all retirees pay now) will be expanded to include a 3.8% tax on investment income (not pension plans) for individuals taking in more than $200,000/year ($250,000 for families). Second, beginning in 2018, insurance companies (not the insured) will pay a 40% excise tax on high end insurance plans worth more than $27,500 annually for families ($10,200) for individuals. Third, and sorority girls everywhere will hate this one, a 10% excise tax will be levied on indoor tanning services. Finally, the huge taxpayer subsidies currently being given to private insurance companies for so-called Medicare Advantage plans will be curtailed.
ACA also requires each state to set up an insurance exchange—essentially a pool of insurance plans all meeting minimum coverage standards, from which those currently without insurance can pick their plan. Those who currently have insurance would have the option of keeping the plan they have (they would not, as Republican disinformation would have it, be forced to give up the plan they have)—or, if they so desired, changing to a plan from the exchange. Moreover, unlike the hundreds of unfunded mandates the Bush administration laid on state governments, ACA provides federal grant money for states to use in establishing the exchange.
There are a few other things in ACA, but these are its major bones. They don’t address every problem in our health care system, but they address many significant ones and do a good job of solving or at least minimizing the adverse effects of those problems.
Oh, yeah—there is the mandate that everyone must have insurance by 2014 that has the Tea Party wingnuts and GOP propaganda machine frothing at their collective mouths. Couple of points here. First, the “mandate” is not literally a mandate. It’s option A. Option B is to pay a $695 per year fine. Second, ACA provides substantial subsidies to assist low income individuals and families handle their premiums. Third, the insurance exchanges from which the policies will come guarantee that premiums will be as low as possible—that’s the free market at work, which every wing nut should love. Fourth, the insurance industry will pick up 32 million new customers—which, again, all free marketers should love. Finally, how can anyone argue that the country will not be better off with 32 million people who are now either completely without medical care or dependent entirely on tax payer subsidy at emergency rooms suddenly having access to adequate medical care for which they—not the taxpayer—are paying? Not to mention, of course, the lives of those 32 million will have significantly higher quality.
But is the mandate consitutional? Notwithstanding one Bush appointed federal judge in Virginia, of course it is. The Tea Party argument is that government is forcing people to participate in a program and pay for that participation. Well, yes it is. Just as it does with Social Security. Just as it does with the income tax. For that matter, just as it does with a driver's license. Whether the Roberts Supreme Court will decide to once again throw decades of precedent out the window is a legitimate concern, but if it simply rules in a manner consistent with all other Supreme Court rulings, the insurance mandate is constitutional.
In a political climate dominated by a party whose primary concern is perpetuating its own power and enriching its already wealthy benefactors, plus a cable network and talk radio world whose primary missions appear to be delivering whatever disinformation guarantees Republican hegemony, we have entered into an era where facts are almost irrelevant. That’s a sad commentary on our country, and perhaps a sadder commentary on those of us who have allowed it to happen. If the right-leaning citizens of this country would occasionally at least look at what their leaders are telling them and fact-check those directives to see if what is being sold as “bad” is really bad for THEM, or if what is being sold as “good” is really good for THEM, they might be surprised by what they discover.
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