2018 MIDTERM ELECTION

Time: D H M S

Hey, remember that time that Marco Rubio and the GOP *hated* health insurance bailouts? Yeah, about that...

NOTE: I've toned down the title a wee bit.

Read this (12/01/15):

Hey, remember the Risk Corridor Massacre? The one which is at least partly responsible (and in some cases, mostly responsible) for a dozen ACA-created Co-Ops (as well as at least one private insurance carrier in Wyoming) going out of business?

Well, there's two more rather interesting developments to the Risk Corridor mess.

First of all, guess who's proudly claiming responsibility for helping destroy over a dozen businesses and kicking hundreds of thousands of people off of "the plan they like"? Marco Rubio.

...Once Republicans took over Congress Rubio’s bill passed into law. There would be no bailouts of health insurers. There would be no bailouts for health insurers. Rubio predicted the problems years before others (as he has with all the foreign policy crises) and figured out a way to deal with them. He laid out his plans in his op-ed in the Wall Street Journal years ago.

...Rubio in 2013 went on the warpath against the program, decrying it as a “taxpayer bailout.” He penned op-eds against it, testified about it as the star witness at a House Oversight Committee hearing and even made his case to top House Republicans including then-Speaker John Boehner (R-Ohio).

Next, read this (8/31/16):

So, to review, the end result of Marco Rubio's shenanigans are:

  • up to 800,000 people nationally lost their insurance coverage, on very short notice, and were forced to scramble to find alternate coverage
  • the new coverage these people ended up with is generally more expensive, and in many cases has worse networks
  • the federal government has to therefore pay out more in premium subsidies to cover the increased costs as benchmark plans were increased
  • over a dozen insurance carriers went out of business, meaning hundreds of people lost their jobs
  • the loss of over a dozen carriers means less competition in those markets, therefore less competition, therefore higher premiums, therefore even more cost to the federal government in subsidies to make up the difference
  • since all of the carriers which went out of business were little guys, this also means the big kahunas suck up even more market share

Then, read this (11/24/16):

Of course it's theoretically possible that the 2016 numbers will end up saving the day...but given that several major carriers have bailed on the exchanges due to ongoing losses this year as well, that's pretty unlikely. So far a total of $458 million has come into the kitty while $8.79 billion in losses have been incurred. Unless the 2016 payments in end up being at least $8.3 billion more than whatever the 2016 receivables out are, the carriers are mostly gonna take a bath on the 3-year program...and even if they're paid in full, that's not gonna bring those liquidated Co-Ops back from the dead.

Of course, from a Republican POV, this is $8.3 billion which they've "saved" U.S. taxpayers.

...That 800,000 figure has actually risen to over 1 million, as several additional Co-Ops have gone belly-up since then, again, in large part due to the Risk Corridor Massacre

And finally, this evening, from Peter Sullivan of The Hill:

GOP in talks about helping insurers after ObamaCare repeal

...But industry officials and healthcare experts are warning that insurers might bail out of the system altogether once a repeal bill passes, particularly since many of them have been losing millions of dollars on ObamaCare plans.

An exodus of insurers could dramatically limit the coverage options for the roughly 10 million people enrolled in the system, potentially creating a backlash.

Recognizing the problem, Republican congressional staffers are in talks with insurers about policies they could implement to help improve their financial situation in that interim period and prevent a breakdown in the market, according to three Republican lobbyists.

...Any policies favorable to insurers could be politically treacherous for Republicans, given that they have railed for years against ObamaCare “bailouts” of insurance companies. It is also unclear if any policy changes would be enough to convince insurers to stay.

...“They want to pump money back in to the insurers without appearing like they’re giving them a handout or bailing them out,” the lobbyist added.

...It is unclear what specific policies could end up being enacted. A starting point is programs similar to ObamaCare’s risk adjustment, reinsurance and risk corridors.

Those programs help guard insurers against losses by shifting money from insurers faring better financially to those faring worse.

Republicans, though, long denounced those programs as “bailouts” of insurers.

Was the Risk Corridor Massacre the only reason that 2/3 of the co-ops have gone belly-up? No, of course not; just as there’s plenty of blame to go around for why Hillary lost the election (her own flaws; Stein voters; Comey’s letter; Wikileaks; etc etc), so too, there were plenty of other reasons why the Co-Ops would have been in trouble even if the RC program hadn’t been torpedoed. Perhaps many of them would still be in business today if they'd received the full RC funds they were legally entitled to, or perhaps all of them would still have gone out of business anyway.

But still. The Risk Corridor Massacre was by far the most hypocritical, jaw-droppingly cynical maneuver of them all in my view. They took a big dump on the ground and are now turning around and trying to rub President Obama's nose in it by doing the exact same thing they decried just months ago.

UPDATE: To be fair, a decent chunk of Democrats did vote for the CRomnibus bill as well, and perhaps they should have fought harder against this provision...but, as noted here:

Some health policy wonks picked up on the language, but it received negligible attention compared to the campaign finance and Dodd-Frank provisions that nearly derailed the spending bill in the House on Thursday night.

Basically, the 2014 CRomnibus bill had to pass if Congress wanted to keep the federal government running. They had already slugged it out over a variety of major issues and the clock was ticking. Furthermore, the way the Risk Corridor program worked, it was possible that killing the funding mechanism might have proven to be a moot point, because it was conceivable that the funding coming into the program from “winner” carriers would equal out the funding going out of it to “loser” carriers. Even if this didn’t happen, it was possible that the shortfall would only end up being a few pennies on the dollar. It was a gamble that they felt they had to take considering that the amendment had been tacked onto a massive “must-pass” $1.1 trillion spending bill. The actual balance sheet numbers didn’t come in until the following summer; it turned out that far more was due to be paid out than came in.

As for this being about protecting the taxpayers from an unprecedented program, as Jonathan Cohn noted:

Rubio and his allies might argue that they oppose risk corridors on sheer principle, that government simply has no business insulating insurers from losses (or sharing in their profits). But if that’s the case, the Affordable Care Act shouldn’t be the only government insurance program on their target lists. Medicare Part D should be too.

Part D, which a Republican Congress designed and a Republican president signed into law in 2003, provides prescription drug benefits to seniors and the disabled through private insurance companies. It has a risk corridor program that operates almost exactly like the one in the Affordable Care Act. The only substantive difference is that Part D’s program is permanent. Yet neither Rubio nor any other conservative is yelling about that.

This was a cynical ploy on the part of Rubio. He was planning on running for President and wanted to be able to crow about “killing Obamacare” during his campaign. And it worked exactly the way he hoped it would: It caused serious damage to the law, helped force a million people to scramble for new coverage, helped shut down over a dozens small businesses, put several hundred people out of work, hurt insurance competition in a dozen states and jacked up insurance premiums even more than they otherwise would have been...while also causing the government to have to pay out more in subsidies, increasing the cost of the law.

Heck, it's even conceivable that those extra APTC subsidies even outpaced the $2.5 billion “saved” from 2014, although that’s difficult to calculate or prove (the CBO estimated about $28 billion in APTC assistance, state exchange grants, and risk adjustment/reinsurance payments for 2015; I'm not sure exactly how much of this went towards APTC itself, nor do I know how much of that was caused by the first dozen Co-Ops going under and sparking domino-effect like rate hikes among the other carriers).

In any event, this is what you can expect a lot of for the next few years: Republicans dusting off and implementing many of the exact same programs and policies that they've been screaming at the Democrats for over the past 8 years, under different names. For all I know, they'll simply replace the ACA with an exact duplicate called "TrumpCare" and call it a day.