Posted 8:43 pm Monday, November 12, 2012
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Obamacare isn’t set in stone now
Backers of President Barack Obama’s health care reform law can be forgiven for thinking it’s all settled, now that he’s been re-elected.
It’s not, it seems. Writing for the Journal of the American Medical Association, Stuart Butler, PhD., says a combination of economic and political realities will put many of the Affordable Care Act’s provisions in doubt.
“Let’s remember that the most important provisions of the ACA, such as penalties for Americans lacking insurance and firms not offering it, the expansion of Medicaid, and the heavily subsidized exchange-based coverage, do not go into effect until 2014,” he writes. “Meanwhile, new taxes on self-employment and limits on flexible spending accounts are scheduled to go into effect next year, just as Congress will be trying to boost employment growth.”
At the same time, Congress will be trying to cut a deal on the deficit. This has the private sector on edge, Butler said.
“Employers have been reporting for some time that concerns about mandatory benefits are slowing their hiring,” he said. “And as the Wall Street Journal recently reported, lower-wage employers are moving towards hiring part-time employees to avoid the ACA’s penalties. These patterns will only grow in 2013 as many employers eye the prospect of putting their employees into the heavily subsidized exchange plans.”
If there’s unexpected demand on those subsidized exchanges, any hopes of curbing costs are gone, he added.
It’s not, it seems. Writing for the Journal of the American Medical Association, Stuart Butler, PhD., says a combination of economic and political realities will put many of the Affordable Care Act’s provisions in doubt.
“Let’s remember that the most important provisions of the ACA, such as penalties for Americans lacking insurance and firms not offering it, the expansion of Medicaid, and the heavily subsidized exchange-based coverage, do not go into effect until 2014,” he writes. “Meanwhile, new taxes on self-employment and limits on flexible spending accounts are scheduled to go into effect next year, just as Congress will be trying to boost employment growth.”
At the same time, Congress will be trying to cut a deal on the deficit. This has the private sector on edge, Butler said.
“Employers have been reporting for some time that concerns about mandatory benefits are slowing their hiring,” he said. “And as the Wall Street Journal recently reported, lower-wage employers are moving towards hiring part-time employees to avoid the ACA’s penalties. These patterns will only grow in 2013 as many employers eye the prospect of putting their employees into the heavily subsidized exchange plans.”
If there’s unexpected demand on those subsidized exchanges, any hopes of curbing costs are gone, he added.
“These developments in the economy will force Congress to reopen key ACA coverage provisions, perhaps as part of a deficit reduction package,” Butler said. “Effects on employment and continued increases in health care costs could also increase the prospects of a bipartisan redesign of employer-based coverage within a tax reform package.”
Then there’s the expanded Medicaid provision within the ACA. The Obama administration will have to deal with 30 Republican governors.
“It’s also hard to imagine the expansion of Medicaid proceeding as planned,” Butler said. “If slow economic growth continues, and statehouse fears of unsustainable employee pensions and other mounting costs continue to grow, even the short-term prospect of Washington picking up expanded Medicaid costs is not likely to prevent a strong pushback by states. That’s going to be exacerbated by a Congress that is desperately trying to curb spending. So expect structural reform of the ACA’s Medicaid, including some version of a block grant, to be on the deficit-reduction table.”
Medicare reform also is possible, even politically beneficial — Rep. Paul Ryan, during the campaign, made a strong case for reform that resonated with seniors. He lost the election, but not the argument. He can still pursue this sensible goal, and he has the support of seniors, who sided with Ryan and Gov. Mitt Romney in Tuesday’s vote.
In other words, the ACA is not set in stone. Republicans, discouraged by last week’s election, must not now disengage and consider the matter settled.
There’s room to improve Obamacare. There are economic facts staring us in the face that will force Congress to at least amend it. And that’s good news.
Then there’s the expanded Medicaid provision within the ACA. The Obama administration will have to deal with 30 Republican governors.
“It’s also hard to imagine the expansion of Medicaid proceeding as planned,” Butler said. “If slow economic growth continues, and statehouse fears of unsustainable employee pensions and other mounting costs continue to grow, even the short-term prospect of Washington picking up expanded Medicaid costs is not likely to prevent a strong pushback by states. That’s going to be exacerbated by a Congress that is desperately trying to curb spending. So expect structural reform of the ACA’s Medicaid, including some version of a block grant, to be on the deficit-reduction table.”
Medicare reform also is possible, even politically beneficial — Rep. Paul Ryan, during the campaign, made a strong case for reform that resonated with seniors. He lost the election, but not the argument. He can still pursue this sensible goal, and he has the support of seniors, who sided with Ryan and Gov. Mitt Romney in Tuesday’s vote.
In other words, the ACA is not set in stone. Republicans, discouraged by last week’s election, must not now disengage and consider the matter settled.
There’s room to improve Obamacare. There are economic facts staring us in the face that will force Congress to at least amend it. And that’s good news.
