ObamaCare Bailouts Are Paving the Way for Government-Run Health

COMMENTARY Health Care Reform

ObamaCare Bailouts Are Paving the Way for Government-Run Health

May 15th, 2018 3 min read

Commentary By

Marie Fishpaw

Director, Domestic Policy Studies

Dan Holler @danholler

Vice President of Heritage Action for America

Key Takeaways

If you thought Republican opposition to ObamaCare and taxpayer-funded bailouts were pillars of the party platform, you could be in for disappointing surprise.

If Republicans bail out ObamaCare, it is likely that a justifiably demoralized Republican base that stays home in November.

Congressional Republicans should keep their focus on providing a real down payment towards larger reforms.

If you thought Republican opposition to ObamaCare and taxpayer-funded bailouts were pillars of the party platform, you could be in for disappointing surprise. According to reports, congressional Republicans are preparing to bail out ObamaCare in the omnibus funding bill this month.

This bailout would transfer billions of taxpayer dollars to private insurance companies selling coverage on the ObamaCare exchanges — a drastic departure from years of Republican campaign rhetoric, long-held policy positions, and legislative efforts. 

Republicans faced difficult realities in achieving this goal last year given a narrow margin in the Senate and no cohesive policy proposal for how to replace Obamacare. The choice now? Double-down on their long-standing goal, or bailout and prop-up the program.

Our concern with bailouts: they are unnecessary and a distraction. Bailouts do nothing to address the real reasons premiums and deductibles are rising – the law’s regulations, mandates and subsidy structure. They are unnecessary because states have flexibility to address rising costs without requiring new federal spending – and are starting to do so with positive initial results. Making that process easier for states would be a good place for Congress to start. Adding more funding now would be premature, and likely will force Republicans to vote regularly to fund ObamaCare.

Most critically, they are a counter-productive strategic mistake with long-term implications. A bailout further expands government-control over health care—taking yet another step towards the Left’s ultimate goal of a “single-payer” government-controlled health care monopoly.

Unfortunately, members in the House and Senate have proposals to do exactly that. Advancing those policies — right after tossing fiscal responsibility out the window last month by blowing through self-imposed budget caps — will further alienate conservatives.

Bailout proponents suggest the proposals are a temporary stopgap until they can finally repeal and replace ObamaCare. But once a bailout is enacted, congressional Democrats could simply expand the payments and add new federal rules on insurers receiving these payments, getting them closer to their long-held policy goal of enacting single-payer by further expanding government control over private health care financing. 

For some congressional members, that long-term policy concern appears to be outweighed by near-term electoral concerns.

The fear is that insurance companies will yet again announce large premium increases just prior to the midterm elections later this year. So, members are offering to pay private insurers billions of additional taxpayer dollars in the hope of getting smaller premium increases.

poll conducted this month found that 61 percent oppose payments to health insurance companies to lower premiums temporarily, and 83 percent agree that taxpayers should not have to bail them out to cover their losses. Additionally, 67 percent of people think subsidies to insurance companies are not only a bailout, but also hide the fact that ObamaCare is failing.

If Republicans bail out ObamaCare, it is likely that a justifiably demoralized Republican base that stays home in November. And given the new polling, it is questionable if moderate voters would even give the party credit for taking bipartisan action.

Reducing premiums is a worthy goal, but legislators need to be honest about why premiums under ObamaCare have skyrocketed. The answer is ObamaCare’s regulatory architecture, which has monopolized the insurance market, eliminated affordable plans, forced healthy individuals to look elsewhere, and doubled premiums between 2013 and 2017.

By not delivering a bill to address these issues last year, the Senate left millions of Americans facing difficult, real-life consequences.

Average premiums for individual health insurance rose 105 percent in the first four years after ObamaCare took effect and consumer choice continues to disappear at an alarming rate. This year, over half of the nation’s counties—including all the counties it ten states — have only one insurer selling exchange coverage. 

Bailing out ObamaCare with taxpayer money will do nothing to mitigate the underlying cause of ObamaCare’s damage. Congressional Republicans should keep their focus on providing a real down payment towards larger reforms, starting by returning to efforts to repeal and replace ObamaCare.

This piece originally appeared in The Hill on 03/16/18

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