Obamacare’s tenth life

This post is cross-posted at Medium.

Back in January, I recounted the Affordable Care Act’s many trials and tribulations in anticipation of what was poised to be its toughest battle yet. From Scott Brown cracking the Democrats’ filibuster-proof Senate majority in 2010, to John Roberts turning gun-shy before obliterating the individual mandate, through Ted Cruz’s government shutdown, Obamacare had more than its share of close calls.

Yet the law defied death again and again. “[F]or eight years, center-left health reform has prevailed against constant slings and arrows because its moral foundations are strong,” I wrote at the time. “Obamacare’s tendency to survive may just be what spares it again.”

And survive again it has. Trumpcare is dead, and Obamacare is alive. The GOP’s seven-plus year charge of repeal and replace went down in flames on Friday, having barely even made it out of the starting gate. And when it comes to the core of Obamacare, Republicans hardly even put up a fight.

That’s because the GOP long ago gave up on contesting the basic moral foundation of Obamacare: the notion that everyone is entitled to healthcare as a right. It was a quiet concession, drowned out by years of chest-thumping cries to repeal Obamacare, but the right implicitly acquiesced to Obamacare’s new normal years ago. That, more than anything, doomed the effort to repeal it.

Republicans tried to resist the moral force of universal healthcare by tarring it as “socialized medicine” and a government takeover of health insurance. But since Obamacare began delivering real benefits to real people, the center of gravity within Republican opposition shifted toward a more practical, less ideological critique about high premiums and inadequate coverage. Underneath the howls for repeal, the conservative objection increasingly moved from universal healthcare itself to the outcomes and mechanisms Obamacare employed to approximate it.

Donald Trump formalized this concession. Just days after his election, he announced that he intended to keep Obamacare’s popular guarantee of coverage for people with pre-existing conditions. Even earlier, Paul Ryan’s “Better Way” proposal agreed to preserve this protection, too. But to insure the sick, you must also insure the healthy — insurance markets cannot function any other way. And when it comes to universal healthcare, insuring both the sick and healthy is more or less the whole ballgame.

To keep protections for the sick in place, the Republicans would have to produce a plan that looked a lot like Obamacare. Under this constraint, the only way to differentiate it — and thus the only way to realistically claim to “repeal” Obamacare — would be to design a version of the law that was meaner, stinger, and outright worse.

That’s ultimately just what the GOP did, but only after abandoning their first strategy: so-called “repeal and delay.” This plan — to give Republicans the political catharsis of an immediate Obamacare repeal vote, but delaying the effective date of repeal for several years — implicitly conceded two important points: First, that it was unjust and untenable to simply repeal and toss people off of their healthcare. And second, that Republicans had no idea how to actually replace the law.

After it became clear that repeal and delay too would cause chaos on insurance markets, that half-baked plan was scrapped once enough leading Republicans (Trump included) clamored for simultaneous repeal and replace. And that course correction produced the monstrosity that was the American Health Care Act.

The bill was a horribly constructed, unloved mess from the day Ryan announced it from behind his smirk. But it was really its Congressional Budget Office score that did it in, for the CBO confirmed what everyone suspected: that AHCA grossly offended the prevailing moral principle of universal healthcare. In pursuit of that principle, Obamacare had normalized a baseline of widespread and affordable coverage. AHCA did immense violence to each of these, threatening to throw 24 million people off their insurance and jack up rates on millions more of the oldest and more vulnerable Americans.

With that, it was only a matter of time before AHCA collapsed in a heap. There were other factors, of course: The Republican Party was in a defensive crouch from the get go, and couldn’t coalesce around a replacement plan. A public enraged by the elevation of Donald Trump to the presidency and terrified of the threat to life and limb posed by repeal galvanized to mount a fierce resistance. But the common thread through all of them was the potent moral force of universal healthcare.

Granted, Obamacare hasn’t yet achieved the goal of universal coverage. But it made a major down payment toward that goal, lowering uninsured rates to historic lows. With the failure of AHCA, the country is refusing to turn back from those gains.

So for the second consecutive Republican presidency, grand conservative designs to gut a pillar of the welfare state have crumbled. When George W. Bush decided to spend his second-term political capital privatizing Social Security, his plan made it through the summer before being pronounced dead. What is remarkable about Obamacare repeal is that it fell apart so fast.

But like Social Security reform, AHCA crumbled under the weight of poor policy design, Republican factionalism, and public resistance. Call it loss aversion, status quo bias, third-rail entitlements — the welfare state has demonstrated an impressive staying power.

And it all comes back to the foundational moral basis for government forging ahead to better people’s lives and provide a sense of security. That’s the brick wall that Ryan’s now-aborted “rescue mission” ran into headlong. Universal healthcare is right and just, and that’s why Obamacare has survived yet again — and perhaps for good.

Stalemate-and-delay: the future of the Obamacare fight?

The fight over Obamacare is poised to dominate much of President Trump’s first year in office.  Republicans are dead set on following through on years of political attacks against the law.  Democrats are equally adamant about saving President Obama’s signature achievement and the millions insured under it.

The problem is that congressional Republicans look increasingly unprepared to follow through on their rhetoric about replacing the law.  Yet they and the Trump administration is convinced the law is failing.  This leaves the GOP in a real bind.

But there may be a way out.  When it comes to Obamacare, the best outcome for everyone may be a stalemate.

As a basic matter of math, Republicans need Democratic support to replace Obamacare.  They could repeal the law with a bare majority in the Senate, but will need eight Democrats to go against the party and overcome a filibuster to enact a replacement.  Republican leadership, including Trump and House speaker Paul Ryan, has backtracked from the repeal-and-delay misfire, and has since come to promise that repeal and replacement will occur near simultaneously.  That requires Democratic votes.

The core question for Trump and the GOP is how to get them.  Trump believes that he is negotiating from a position of ever-increasing strength.  He thinks the law will crumble on its own, even telling congressional Republicans gathered in Philadelphia that he had thought about “doing nothing [on healthcare] for two years, and the Dems would come begging to do something” after “catastrophic” price increases.  Ryan has the same forecast for the law, repeatedly (and falsely) asserting that Obamacare’s individual marketplaces are in a “death spiral.”

Trump has hinted at this scenario before.  Earlier in January, Trump tweeted that the GOP needed to “be careful” about repealing Obamacare, because Democrats would be to blame when the law “fall[s] under its own weight.”  There is clearly a side of Trump that sees political advantage to continuing to hang Obamacare around the necks of Democrats—a side of him that splits from Republican leadership in Congress on the immediate urgency to erase the law from the books.  By sitting back and waiting, Trump suspects he could get a better deal.

Democrats, on the other hand, are confident that Obamacare is succeeding.  They point to the 20 million people insured under the law and signs that its marketplaces have stabilized.  Democrats are determined to resist GOP repeal efforts, and are increasingly drifting toward a strategy of all-out opposition to Trump across the board.

From the Democrats’ perspective, there’s no reason to disabuse Trump of his notion that Obamacare is a ticking time bomb with their names attached to it.  Suppose Democrats stick together as a uniform bloc in opposition to repeal and replace.  A frustrated Trump might see the Democrats as “ungrateful” for the GOP’s efforts to save them from their supposed healthcare mess.  Trump might then decide to wait until carnage from Obamacare’s “collapse” starts to hit in order to exact a better deal out of desperate Democrats at that time.

For Democrats, this result keeps Obamacare on the books, delaying the repeal fight until a day when Trump may be on even weaker ground in public approval, and a day that is that much closer to the 2018 midterm elections.  At that point, Democrats could spark a wave election to take back the House or Senate, stopping Trump’s agenda altogether.

But stalemate-and-delay makes sense for Republicans, too.  If Trump gets fed up with congressional gridlock over healthcare and with how much of his first year in office the issue has consumed, he may want to shelve repeal—especially if he expects to pin down the Democrats into agreeing to more favorable terms down the road.  But would the repeal-obsessed GOP Congress go along with this?  Almost certainly.  Trump owns the GOP now, and the party will largely do as he says.  If Trump says build a border wall, Ryan asks how high (while writing a $15 billion check, to boot).  There’s no reason to think the party would subvert him if he tired of the Obamacare battle.

Trump and other leaders take the position that even though they could wait and let the law implode on its own, they have a duty to come to the rescue of those suffering under the tyranny of Obamacare.  By postponing the repeal push, Republicans get to blast obstructionist Democrats for perpetuating the hellish suffering inflicted on the American people under Obamacare.

This relocates the Obamacare debate back into the Republicans’ comfort zone.  Republicans are most at ease using healthcare as a political piñata against Democrats.  But now that they have the power to decimate Obamacare, they have no plausible plan to put the piñata back together again.  At the GOP’s Philadelphia retreat this week, one member of Congress said that the party’s leaders have offered “zero specifics” on an Obamacare replacement so far.  A leaked recording of that retreat shows Republican members of Congress ill at ease with the party leadership’s lack of strategy and clarity on healthcare.

So for Republicans in Congress, postponing repeal buys more time to devise a replacement plan, while allowing them to continue to use Obamacare as a political battering ram to rally their base going into the 2018 midterms.  Even though they’ve spent seven years railing against the law, Obamacare repeal is a fight that the GOP is not ready for.  Republicans are animated by political opposition to Obamacare as an avatar for big government liberalism.  But they still aren’t equipped or prepared to translate that political opposition into policy language.  Stalemate-and-delay allows them to reap the benefits of the former while avoiding the embarrassment of the latter.

Conversely, it also avoids Republicans taking ownership over the country’s healthcare system going into those elections—something many in the party are loath to do.  “We’d better be sure that we’re prepared to live with the market we’ve created” with repeal, said Rep. Tom McClintock of California.  “That’s going to be called Trumpcare. Republicans will own that lock, stock and barrel, and we’ll be judged in the election less than two years away.”

There are risks in this gambit for Democrats, but those risks are tolerable.  The key is for Democrats to stick together in total opposition to GOP repeal efforts.  And they will be sticking together to defend a wounded healthcare law—one that the Trump administration will weaken to the fullest extent of its executive authority.  Trump already issued an executive order instructing his administration to relax enforcement of the law “to the maximum extent permitted by law.”  White House adviser Kellyanne Conway even suggested the administration may refuse to enforce the law’s controversial individual mandate.  And Trump also canceled planned advertising for the law’s individual marketplace plans in the final days of open enrollment in an apparent attempt to reduce sign-ups.  These are all attempts to loosen the screws on Obamacare’s three-legged stool.

But these risks were always going to be the case under a Republican administration.  Republican sabotage was inevitable, but it beats wiping the law off the books entirely.

So perhaps Obamacare’s future looks much like its past: a political lightning rod perpetually on the chopping block, but never actually chopped.  Trump can rationalize stalemate-and-delay as standing pat until a later day when he can bend Democrats to his will.  Republicans can keep rallying their base on the promise of repeal were it not for those obstructionist, big government Democrats.  And Democrats can appeal to their base having successfully fought Trump and continuing to stand up to Republicans intent on gutting Obama’s signature achievement.

And that might be Obamacare’s political sweet spot.  Democrats want to save Obamacare, and Republicans need an off-ramp from repeal.  For both parties to win, the solution might just be to stalemate.

The case for federalizing Medicaid

If Donald Trump ever moves on from bickering over the size of his inauguration crowd to actually governing, one of the first orders of business will be churning out a promised “terrific” Obamacare replacement plan. While we don’t yet know the exact details of Trumpcare, Trump adviser Kellyanne Conway confirmed this week that block granting the Medicaid program to the states will be a big part of it.

This isn’t a surprise. Republicans like Speaker Paul Ryan and health secretary nominee Rep. Tom Price have called for kicking Medicaid down to the states for years. Unfortunately, it’s the exact wrong direction we should be going toward.

Medicaid provides health insurance to nearly one hundred million people, including children, pregnant women, nursing home residents, people with disabilities, and low-income Americans. For over fifty years, the program has been managed jointly by the federal government and the states. Washington finances at least half of the program’s costs, and often substantially more in poorer states. Obamacare expanded Medicaid to cover those just above the poverty line, and even offered to pick up the entire tab for the first years of the expansion. Still, nineteen conservative-led states turned down free money, causing a Medicaid “coverage gap” currently ensnaring 2.5 million people that would have otherwise gained insurance.

Conservatives in Washington want to drastically change this arrangement by simply cutting a check to the states and letting them run Medicaid. Conservatives like this idea for a few reasons. For one, a block grant creates more predictable (and lower) costs for the federal government. It gets the federal government off the hook for covering a share of whatever costs program enrollees incur, and instead just subsidizes state Medicaid programs. A block grant transfers most of the commitment of insuring vulnerable populations from the federal government to the states.

The problem, of course, is that this is a barely-concealed way of cutting healthcare funding for the poor. The only way for block grants to save the federal government money is to systematically lowball the amount of the grant. For example, the block grant plan pushed by Price and other House Republicans would slash Medicaid spending by $1 trillion — nearly 25 percent — over the next decade. A similar plan offered by Paul Ryan in 2012 would have caused up to 20 million Americans to lose their coverage.

This leaves it to individual states to pick up the slack, but it’s far from guaranteed that they are willing or able to do so. Medicaid is already one of the costliest expenditures for states, consuming on average nearly 20 percent of their budgets (second only to K-12 education). Making up for a $1 trillion funding gap would be a stretch even during relatively good economic times. But during a recession, block granting would be a disaster. While the federal government can take on debt to finance deficit spending, almost every state is required to keep a balanced budget. When revenues dry up during a downturn, states take an axe to social spending to make up the difference. These cuts inevitably come disproportionately from low-income programs. So the end result of block-granting means Medicaid will get cut to the bone just when more and more people will need it.

Block-grant proponents want to give states more of a role to experiment with Medicaid. But just as some states may seize on new flexibility to experiment upward with better, more generous programs, others will ratchet Medicaid downward by providing stingier benefits. Those nineteen states refusing the federal Medicaid expansion in particular have political cultures deeply hostile to insuring the needy. In Texas, for example, childless adults are ineligible for Medicaid regardless of how poor they are, and even parents are “too rich” for coverage if they earn more than 18 percent of the poverty line — $2,118 a year.

Even though national Republicans package Medicaid block granting as an exercise in states’ rights, it’s not clear how many states want the privilege of taking the primary lead in running Medicaid. Even some Republican governors worry that block grants will reduce the effectiveness of their safety nets. Medicaid block grants could easily follow the pattern of welfare reform — another safety net program devolved to the states during years of economic growth that has since shriveled away due to chronic underfunding.

Instead of block-granting Medicaid to the states, a better course is to do the exact opposite: have the federal government assume full responsibility for Medicaid. This would eliminate harsh state-based eligibility restrictions like in Texas, and would guarantee coverage for all who qualify. Because the federal government can run budget deficits, it is better situated to protect the program during economic downturns. And federalizing Medicaid would relieve the states of a massive fiscal burden, freeing up money for education, infrastructure, tax cuts, and other state projects.

Putting Medicaid entirely in the hands of the federal government may also better tame the program’s costs. As Greg Anrig of the Century Foundations writes, “taking 50 separate state bureaucracies out of the picture would be a meaningful step in the direction of reducing confusion and wastefulness.” Congress and federal agencies would also be better able to experiment with cost-containment strategies without the states in the mix.

Federalizing Medicaid could also yield tax relief for low- and middle-income Americans. While new federal revenues would need to be raised, the states would be free to cut taxes. And because the federal tax code is more progressive than the states’, most of the new financing for Medicaid would come from the wealthy. The net result would likely mean lower taxes for most Americans.

Federalization is not a new idea, nor a partisan one. As Anrig points out, Ronald Reagan proposed federalizing Medicaid in 1982 in exchange for giving the states over other safety net programs. Even earlier, in 1979 Jimmy Carter proposed federalizing Medicaid as part of his health reform pitch.

On the campaign trail, Donald Trump promised that he would not cut Medicaid. That’s a promise he cannot keep while also block-granting the program. Instead of pawning Medicaid off on the states, the federal government should lift it off of their shoulders entirely. That would give the states real flexibility.

Note: This post is cross-posted at Medium.

A Red State Option on Steroids for Obamacare

The Affordable Care Act came under existential attack the minute it was signed into law.  Almost immediately, a slew of Republican state attorneys general rushed to the court house to have the law struck down on the grounds that its individual mandate to purchase insurance was unconstitutional.  Less noticed but just as consequential was a sidecar challenge to the law’s mandatory Medicaid expansion, arguing that it violated states’ rights.

When the case (known as NFIB v. Sebelius) reached the Supreme Court, it split the polarized justices.  Four conservatives were ready to toss out the law entirely, four liberals were bent on saving it.  In an apparent tacit compromise, Chief Justice Roberts agreed to provide the fifth vote to uphold the mandate as a tax, while liberal Justices Breyer and Kagan joined the majority in striking down the mandatory Medicaid expansion.

This was hailed as a victory for Obamacare, but the under-noticed Medicaid ruling has had dire consequences.  The Court’s decision opened up a “Red State Option,” and nineteen conservative-led states have opted not to expand their Medicaid programs to cover the near poor, ostensibly out of sheer partisan spite.  This has blocked 2.5 million people from obtaining insurance.

I point this out because a pair of Republican senators are proposing a large-scale version of the Supreme Court’s compromise today.  In order to replace Obamacare, Sens. Susan Collins of Maine and Bill Cassidy of Louisiana would create a sort of Red State Option on Steroids, allowing states to opt out of Obamacare entirely if they so choose.  As Vox’s Sarah Kliff explains:

The Patient Freedom Act would, as described by Sens. Cassidy and Collins, give states three options:

  1. Continue to run the Affordable Care Act as is without any changes
  2. Switch to a different health insurance expansion that emphasizes auto-enrolling all uninsured residents into a federally subsidized catastrophic plan
  3. Offer no coverage expansion at all, and the state would lose the money it currently receives for insurance subsidies and Medicaid expansion

Under Option 1 (let’s call it the “Blue State Option”), progressive states such as California and New York that like Obamacare can keep it.  Or at least, they can keep most of it—Cassidy-Collins would impose a 5 percent cut on subsidy payments to Obamacare enrollees.

Under Option 2 (the “Red State Super-Option”), conservative states like Texas and Kansas can ditch Obamacare entirely and opt into a not-yet-fleshed-out conservative replacement plan.  Cassidy and Collins haven’t yet fully formed what this replacement looks like, but it will involve auto-enrollment of the uninsured into high-deductible catastrophic insurance plans attached to health savings accounts.  The money that would have been spent on Obamacare subsidies in these states will be redistributed into these HSAs based on each individual’s age, rather than income.

Option 2 will tend to disadvantage low-income individuals, because it abandons Obamacare’s means-tested subsidies.  And it also undercuts the GOP’s current main objection to Obamacare: its high out-of-pocket costs.  With high-deductible plans, enrollees aren’t really insured at all until they first rack up thousands of dollars in medical expenses, and must self-fund everything else with their own savings.  This will aggravate healthcare-induced financial strain, not alleviate it.  For that reason, HSAs tend to be virtually useless to all except the wealthy.  Even so, Option 2 is a revealing look at the true conservative impulse of what right-leaning health reform would look like.

Option 3 is essentially a State of Anarchy Option.  As health economist Aaron Carroll says, “I have no idea why any state would choose [this option].”  This option would appeal only to states looking to mindlessly blow up the healthcare coverage expansion (there may be some…), but would otherwise seem to solely exist to prod states toward choosing one of the other two options so as not to lose federal money.

Under all three options, the ACA’s taxes are left in place—a concession sure to rankle congressional Republicans.  Annual and lifetime limits will stay, too, as will the ability of children to stay on their parents’ insurance until turning 26, and the prohibition on insurers excluding patients with preexisting conditions.

The Cassidy-Collins plan is plainly meant as an attempt to craft a bipartisan way out of the Obamacare repeal fight.  Republicans need eight Democratic votes to enact any replacement plan, and Sens. Cassidy and Collins hope that Democrats might settle for kicking the Obamacare decision down to the states.

For Democrats, the only reason to support this idea is because saving Obamacare in blue states is better than not saving it at all.  It’s a sort of second-best option that at least protects individuals in Democratic-led states.

But Cassidy-Collins will also amplify healthcare polarization from state to state.  The Medicaid expansion has already shown that some states will almost certainly not make this decision based on legitimate policy considerations around how best to expand health insurance.  The issue of healthcare has become too partisan, with the ACA serving as an avatar for anti-Obama resistance.  Perhaps that resistance will finally defuse now that Obama has left office, but Cassidy-Collins certainly gives the states the opening to widen the geographic gulf in our healthcare system.

And of course, the most vulnerable will be the ones who suffer.  As Topher Spiro of the Center for American Progress writes, “It’s unconscionable that access to quality health care would depend on where you happen to live.”  Cassidy-Collins puts the decision about who deserves health coverage in the hands of state elected officials, who are disproportionately conservative Republicans skeptical of universal healthcare in much of the country.

Perhaps the most significant outcome of Cassidy-Collins is that it signals that there is a cohort of Republican senators who are serious about committing to a replacement plan before killing Obamacare altogether.  Collins has already said that Republicans must have at least a “detailed framework” for a replacement before repealing the law.  Her vote is one that Republicans need in order to move in any direction on healthcare.

But Cassidy-Collins is also telling in other ways.  By punting the repeal fight to the states and presenting them with a menu of healthcare options, the proposal creates a sort of Choose-Your-Own-Adventure Federalism.  In a country growing increasingly divided by politics, Cassidy-Collins embraces polarization in policy.

Contrary to Obama’s 2004 convention speech, there clearly are Red States and Blue States when it comes to health policy.  Federal health policy ought to serve as a floor to guarantee certain rights and benefits regardless of state politics.  But the so-called “compromise” bill in the Senate would abscond from that duty and instead only heighten our political divide.  Whether or not it is a tenable compromise, the fact that such an outcome is viewed as a plausible off-ramp speaks volumes about the state of our politics.

How Obamacare repeal sets the table for the entire GOP agenda

President-elect Donald Trump and his Republican allies in Congress are ready to press ahead with Obamacare repeal come January.  The effects of repeal will be devastating enough.  But repeal also triggers problems that help the GOP justify the rest of its agenda.  By repealing Obamacare, Paul Ryan and company will try to bootstrap in drastic changes across government in the name of reducing deficits and stabilizing federal programs like Medicare.

Republican plans to repeal Obamacare would exact a massive human toll.  Repeal could throw upwards of 30 million people off of their health insurance, doubling the current uninsured rate.  And if Republicans gut the law’s protections for those with pre-existing conditions, 52 million people would struggle to find affordable insurance.

The human carnage of repeal is meant to coerce Democrats into going along with a right-wing replacement bill.  Republicans will have 52 votes in the Senate in 2017.  They can repeal most of Obamacare with 51 votes for a reconciliation bill.  But to enact new legislation replacing the law, they’ll need eight Democratic votes to overcome a filibuster.  The thinking is that creating an Obamacare cliff with massive human disaster on the other side will compel cooperation from Democrats.

Never mind whether this scheme can actually work without provoking a stampede of insurers out of Obamacare’s marketplaces during the transition period leading up to the cliff.  Like the hostage-taking expeditions during the Obama administration—the debt ceiling fiasco, the fiscal cliff, the government shutdown—this is another instance of the GOP manufacturing a crisis in order to strong-arm its policy priorities through Congress.

Conveniently for Republicans, Obamacare repeal opens the door to far more of the conservative agenda than just upending the individual insurance market.  According to a new report from the Brookings Institute, repeal would also jeopardize the solvency of Medicare.  Obamacare included a 0.9 percent payroll tax on incomes above $200,000 to help shore up Medicare’s finances.  This extended the solvency of the program’s trust fund until at least 2028.  Without this tax, Medicare could go broke in less than eight years.

It’s impossible to imagine conservatives restoring any of Obamacare’s taxes on the wealthy.  (Indeed, cutting these taxes is part of the appeal of Obamacare repeal for Republicans.)  And by repealing the law, Republicans also drag Medicare closer to crisis.  It’s easy to picture Ryan and others seizing the opportunity to warn that Medicare cannot be sustained without drastic changes along conservative lines–the type of reform Ryan has spent years pursuing.  The conservative vision would terminate our commitment to Medicare as a government-run insurance plan, and replace it with a voucher payment to seniors to shop on their own for private insurance plans.

So by repealing Obamacare, Republicans worsen Medicare’s financial position and thereby tee up the case for privatization.  But that’s not all.  The passage of Obamacare has corresponded with a marked slowdown in the growth of healthcare costs over the last several years.  The U.S. is currently on pace to spend $2.6 trillion less on healthcare than we expected before Obamacare was passed.  It’s difficult to assess how much Obamacare contributed to these savings, but it undoubtedly played a part.

If this slowdown is reversed by repeal, and healthcare costs begin to balloon again, the GOP could well use it as an excuse to pass the rest of its radical policy prescription across the entire gamut of American insurance options.  These reforms range from block-granting Medicaid to capping the tax exclusion for employer-provided insurance to promoting higher deductibles for more people.

Repeal could even give Republicans space to shoehorn in their desired policies outside of healthcare.  The Brookings report also found that Obamacare repeal will worsen long-term deficits.  Republicans will also undoubtedly pursue massive tax cuts near simultaneously with Obamacare repeal.  This combination will cause deficits to explode.  And as the Congressional Budget Office begins projecting larger and larger deficits, Republicans will have a ready-made excuse to justify austerity politics and massive cuts to safety net programs and other domestic spending.

We’ve seen this story before: the GOP leverages a crisis of its own making to push through its chosen policy prescriptions.  Even with a congressional majority, Republicans won’t be able to quit governing through crisis mode.  Their policy agenda will be painful for millions of Americans, and deeply unpopular because of it.  Republicans need a pretext to bolster the political necessity for making sweeping changes to our safety net.  Repealing Obamacare unlocks a whole host of rationales to help the GOP do precisely that.

But this also allows Democrats and other Obamacare defenders to lay out the full stakes of repeal.  Obamacare repeal doesn’t just rob insurance from the millions who have gained coverage under the law.  Repeal also jeopardizes the financial sustainability of Medicare for future retirees.  Repeal threatens to ignite higher healthcare inflation, raising premiums and eroding employees’ take-home pay.  Repeal erodes the financial standing of a whole host of programs for low-income Americans that are vulnerable to arbitrary budget cuts.  The implications of repeal are simply massive.

By repealing Obamacare, the GOP is trying to tee up its entire legislative agenda.  Liberals have an obligation to shout from the mountaintops about the full harm of this conservative exercise in bootstrapping.

The incredibly weak case for repealing Obamacare

Unified conservative government in Washington has given Republicans an unobstructed path to repeal Obamacare. As Vice President-elect Mike Pence recently assured a group of Heritage Foundation donors at the Trump International Hotel, “We’re going to repeal Obamacare lock, stock and barrel,” calling repeal the incoming administration’s “number one priority.”

But as clear as the repeal path may be, it’s worth pausing to reflect on the actual merits supporting the unrelenting conservative attack on the law. As it turns out, the case against Obamacare is incredibly weak.

First and foremost, more than 20 million people have gained coverage under the law, driving the uninsured rate to historic lows. These gains would be reversed by repeal. Repeal could cost as many as 30 million people their health insurance, causing the uninsured rate to double. And without Obamacare’s protections, 52 million people with a preexisting condition may struggle to find affordable insurance.

Moreover, many of the controversies that conservatives ginned up while the law was being drafted never came to pass. The public option for health insurance was scrapped before the law was enacted. The Cadillac Tax on high-end health insurance plans has been perpetually delayed. The supposedly job-killing employer mandate took effect this year, yet private sector employment continued to rise, as it has every month since Obamacare became law. The cancellation of low-quality insurance plans, which affected a small fraction of the country in 2013, was a one-time product of the transition to Obamacare. “Death panels” were never a real thing. The real, much more innocuous idea—reimbursing doctors for counseling patients about end-of-life care options—was stripped from Obamacare, and then quietly adopted by regulation last year.

Still, conservatives are nonetheless forging full steam ahead with kneejerk Obamacare repeal. “This law, you have to remember, is hurting families in America,” Speaker Paul Ryan recently said with little regard for the millions of families insured under the law. “So we have to bring Obamacare relief as fast as we possibly can in 2017.”  He and other Republicans now cling to two chief objections to Obamacare: its effect on out-of-pocket payments, and its mandate to carry health insurance. Neither would be improved by repeal.

Republican complaints about premiums under Obamacare are a shameless exercise in bootstrapping. It’s true, premiums on most of Obamacare’s exchanges rose significantly this year. But Republicans themselves triggered part of these premium hikes by repealing Obamacare’s risk protections for insurers last year. Conservatives intentionally wounded the law, and then complained when insurers backed out and premiums rose because of it.

Moreover, premium hikes were surprisingly low over the previous two years, so some of this year’s increase came from insurers returning to expected premium levels. It’s also a product of insufficient competition. More insurers competing for business would produce better bargains for consumers.

There are sensible ways to fix these problems that are far less disruptive to our healthcare system than wholesale repeal. Young, healthy people have sat out of the marketplaces in greater numbers than expected. If more of these customers purchased insurance, more insurers would participate and consumer costs would be lower. To attract more healthy customers, the marketplaces need to offer more appealing coverage options. This could be accomplished by allowing the federal health exchange to actively negotiate better rates with insurers, like California’s exchange already does. The government could also offer more generous cost-sharing subsidies to help with out-of-pocket expenses. And we could allow those nearing retirement age—say, individuals 55 and above—to sign up for Medicare. This would pull some of the oldest and costliest patients out of the individual marketplaces, lowering premiums for everyone else, and making those marketplaces less risky for insurers.

Repeal, on the other hand, would only make matters worse. To the extent Republicans succeed in lowering premiums under an Obamacare replacement, they would likely do so only by weakening the quality of insurance. Young and healthy people may see lower-cost options, but older and sicker people could see substantial premium increases. And costs on the individual market could skyrocket if Republicans try to retain Obamacare’s ban on preexisting condition exclusions without implementing an adequate substitute for the individual mandate.

Which gets to the long-time conservative bogeyman of Obamacare: the individual mandate. The mandate is the lynchpin the holds the law together—you can’t guarantee private coverage to the sick at fair rates without also guaranteeing insurers a broad pool of healthy customers. The mandate offers everyone a choice: you can do your part to secure a more equitable healthcare system by either purchasing insurance or paying a tax.

Even though they invented the individual mandate, conservatives have spent years railing against it as an unconscionable intrusion on individual liberty. But if the mandate impairs freedom at all, it’s the freedom to suffer from health insecurity and vulnerability to illness, tax-free. That’s hardly a freedom worth preserving.

Instead of an individual mandate, most conservative repeal plans adopt a “continuous coverage” requirement. Like the mandate, this would require Americans to continuously carry insurance coverage. But rather than paying a tax to the government, those who go through a spell without insurance would get price-gouged by insurance companies. These individuals would be hit with higher premiums when they reenter the insurance market, and potentially really high premiums if they have a preexisting condition.

It’s hard to say whether this complex penalty will even work, given that the so-called “young invincibles” the individual market desperately needs are prone to lowballing the likelihood of future illness. But the conservative individual mandate replacement is, if anything, a more draconian penalty than Obamacare’s mandate. The conservative plan adds insult to injury for those who fall on hard times: If you lose your insurance, you get penalized with higher future premiums and inadvertently waive your right against discrimination on the basis of illness. What’s worse, the conservative plan makes it harder for those down on their luck to afford coverage in the first place. Because conservatives would abandon income-based subsidies, many people will be caught in an impossible situation: buy insurance you cannot afford now, or get hit with even higher premiums in the future.

Currently, Republicans are trying to devise a “repeal and delay” scheme to avoid upending the individual markets while they work out a replacement bill. But the difficulty of these efforts only underscores the fact that Obamacare is fundamentally a moderate reform. Ironically, repeal would be much easier for Republicans had Obamacare expanded insurance through a single-payer, Medicare-for-All scheme. In that alternative universe, Republicans could simply schedule Medicare-for-All to sunset on, say, December 31, 2018, and the to-be-determined right-wing reform would seamlessly kick in the next day, with minimal turmoil in the interim.

Instead, Obamacare opted for a more cautious approach dependent on the voluntary participation of private insurers. This has made it harder to expand coverage and guarantee insurance offerings across the country. But at the same time, the prospect of a painful zombie transition period on the exchanges also makes the law harder to repeal. Insurers could exit the marketplace in droves after a repeal vote, as if fleeing a sinking ship. This would cause real pain in the lives of the millions of Americans left uninsured, and political pain to the repeal-obsessed GOP.

Conservatives believed their own spin that Obamacare was a big government monstrosity. Now in a role of actual power and responsibility, they are grappling with the inconvenient truth that the law really is a carefully crafted, moderate reform bettering the lives of millions of Americans—all of which makes the unthinking march toward repeal deeply irresponsible.

The path to repeal is wide open for Republicans. And raw power politics means they can pretty much do as they please. But in a democracy, the party in power still owes the country a justification for its policy agenda. And when you really get down into it, the case for Obamacare repeal is spectacularly weak.

Note: This post is cross-posted at Medium.

The GOP’s Obamacare cliff is closer than they want you to believe

During the budget wars of the Obama administration, congressional Republicans regularly courted national disaster by forcing fiscal cliffs, debt cliffs, and austerity cliffs on the country.  Now in control of Washington, Republicans look poised to set up an Obamacare cliff.  This might be the most reckless act of GOP gamesmanship yet.

When it comes to Obamacare, the GOP is the dog that caught the car.  Republicans have railed against the law for years, voting to repeal it 60 times and shutting down the government in protest.  But now that they are in power, Republicans are finding themselves utterly ill equipped to take action against the law.  That’s because they still haven’t yet readied a nuts-and-bolts health reform plan over the last six years.  Even though “repeal and replace” has long been their rallying cry, conservatives have spent precious little time forging a unified strategy for the latter part.

Aside from policy considerations, “repeal” also has a simpler legislative path than does “replace.”  The GOP can repeal most of the law through a reconciliation bill on a bare-majority vote, meaning without Democratic cooperation.  To affirmatively pass a replacement law, however, Republicans will need Democratic votes, unless they kill the filibuster (which some key Republican senators are reluctant to do).

This combination of policy uncertainty and political expediency is pushing the GOP toward a strategy of quickly repealing the law on a time delay.  Without a readily available replacement, Republicans will try to repeal the law while postponing its actual demise until perhaps January 2019, after the 2018 midterm elections.  This would ostensibly give Congress two years to devise a replacement for the law, extending Obamacare a two-year fuse until it explodes.

GOP health policy expert James Capretta objects to this strategy on the grounds that Congress will wind up perpetually extending Obamacare’s two-year lifeline.  “If . . . the GOP sticks with a repeal-only bill,” Capretta argues, “there is a high probability that they will never get around to agreeing on a workable replacement plan. At which point the odds would then favor retention of the ACA, or something close to it, as the only viable way forward.”

Capretta points out that legislative momentum will only wane after 2017 and into 2018.  The likelihood of an Obamacare replacement doesn’t increase over time, but dwindles by the day.

Keeping Obamacare on the books may be the conservative nightmare scenario.  But the other consequences of the GOP’s reckless repeal-and-delay course are far more dire.  For one thing, the mere contemplation of repeal, let alone actually passing a repeal bill, may be enough to create an insurer stampede out of the law’s marketplaces.  Insurers must decide whether to offer plans for 2018 in the marketplaces before May 2017, just three months into the new Congress.  Many will be unlikely to participate in a program that is in the midst of being slowly killed off.  This is particularly true given the already fragile state of the exchanges, which are in need of constructive reform, including previous wounds inflicted by the GOP to strip the law’s protections for participating insurers.  If insurers flee a perceived sinking ship, the law will cease to function whether it’s officially repealed or not.

If the GOP forges ahead with repeal-and-delay and triggers an insurer exodus in the process, there very well may not be any can to kick down the road again come January 2019.  The law could become zombie health reform with impotent, ghost-town marketplaces.  There would be nothing left for Congress to extend.

So the GOP likely cannot reap the political benefits of repeal while putting off the tangible costs for two years.  And those costs would be very real.  The private insurance markets in all fifty states could seize up, making it functionally impossible for the millions of people who currently rely on Obamacare’s exchanges today to obtain coverage.  The historic gains we’ve made in expanding insurance would quickly reverse.  Repeal-and-delay would take a massive human toll.

So if the exchanges are mostly bled dry by Republicans before January 2019, what then?  Once the GOP lights this fuse, the rapid deterioration on insurance markets would probably place immense pressure on Democrats to cooperate with right-leaning reform efforts.  And if the 2018 midterm elections become a backlash against Trump and restore Democrats to power in Congress, then Democrats would be left to clean up the healthcare mess that the GOP is about to create.

The GOP’s repeal-and-delay strategy is ostensibly meant to buy Republicans time to devise a substitute to center-left health reform.  But it’s hard to see what Republicans will be able to dream up in two years that they couldn’t in six.

Setting up an Obamacare cliff once again triggers a high-stakes game of chicken.  But unlike previous congressional chicken matches, blinking at the last hour might not spare the harm this time.  Rather, because Obamacare relies on private health insurers to expand coverage (i.e., because Obamacare is a centrist attempt at universal healthcare), the harm of repeal may be realized well before Congress even has a chance to flirt with plunging over any self-concocted cliff.

So Republicans pushing repeal and Democrats opposing it need to understand that “repeal and delay” is functionally no different than straight-up repeal .  Delay does not postpone the fight for another day.  When that day comes, it will already be too late — the law’s foundations will already be drastically weakened, perhaps entirely moribund.

Republicans are trying to set up yet another cliff to force congressional action.  But the cliff is much, much closer than it might appear.  The question is who truly realizes it.

The reconciliation option

Jacob Hacker dangles an intriguing legislative prospect in his New York Times op-ed promoting a public option as a cure to Obamacare’s woes.  Specifically, he suggests that Democrats could enact a public option with a bare-majority vote in Congress through the budgetary procedure of reconciliation:

This year, Senate Republicans, providing another lesson, passed legislation that repealed the Affordable Care Act through the budget process, which isn’t subject to a filibuster. (President Obama vetoed it.) If that’s possible under the budget rules, creating a public option should be, too — especially since it could reduce the deficit by tens of billions of dollars a year.

Reconciliation is a tool that allows for expedited consideration of budgetary legislation.  Importantly, it allows legislation to overcome the Senate filibuster and pass with simple majorities in each chamber of Congress.  The filibuster, of course, is the veto power invoked by 41 minority party senators to obstruct the legislative will of the majority.  It’s not part of the Constitution, and as wielded by Senate Republicans, the filibuster has created an unnecessary de facto super-majority requirement for virtually all congressional action.  Reconciliation is a safety valve to let lawmaking go forward in the face of obstructionist filibustering.

What can and cannot be achieved through the reconciliation process depends heavily on precedent and the whims of the Senate parliamentarian.  Most famously, Obamacare was originally heaved over the finish line through reconciliation after the Democrats abruptly and unexpectedly lost their Senate super-majority in 2010.  The main requirement for reconciliation is that it must be budgetary neutral, and may not add to the federal deficit.

During the past year, Paul Ryan and House Republicans have been steadily expanding the bounds of reconciliation.  Congressional Republicans have passed bills repealing Obamacare, including its insurance subsidies, Medicaid expansion, and individual and employer mandates.  They even used reconciliation to de-fund Planned Parenthood.

None of these bills made it past President Obama’s veto.  But they did pass muster as appropriate uses of reconciliation with the Senate parliamentarian.  This helped Ryan create precedent for 2017, when he hoped to have a Republican president to sign off on his bills instead of vetoing them.  Indeed, in early October, Ryan was openly talking about his plans to pass much of his agenda through budget reconciliation next year.

But the last month has turned the tables on Ryan’s reconciliation plan.  After a catastrophic month for Donald Trump, the presidency is Hillary Clinton’s to lose, Democrats have a good chance to retake the Senate, and may even have the House within reach if the agony of Trump sufficiently depresses Republican turnout in November.  Ryan’s hopes to push his “Better Way” agenda through reconciliation have been dashed, and now it’s the Democrats who are looking for creative ways to enact their legislative priorities.

So could a public option really be passed through reconciliation?  There’s good reason to think so.  According to the Center on Budget and Policy Priorities, a good deal of major legislation has relied on reconciliation, including welfare reform in 1996, and the 2001 and 2003 Bush tax cuts (which actually increased the deficit and debt).

Most relevant, Congress has used reconciliation to create major health insurance programs before.  In 1985, it used reconciliation to extend health coverage to workers who have lost their jobs (so-called “COBRA” insurance).  In 1997, it used reconciliation to create the Children’s Health Insurance Program, extending coverage to millions of low income children.  And also in 1997, it used reconciliation to create Medicare Advantage.

Not to mention that Obamacare itself (and repeated efforts to repeal it) relied on reconciliation.  If the original law fit the standards of reconciliation, then so too should  most efforts to tweak and improve it.  If balanced with new revenue sources, then Democrats could conceivably enhance insurance subsidies, lower the Medicare eligibility age, expand Medicaid, and enact a whole host of other health reforms all through reconciliation without regard for the hurdles posed by congressional Republicans.

If Democrats eke out only the slimmest majorities in Congress, it doesn’t have to be a recipe for gridlock and legislation stymied by Republicans relegated to minority status.  Much of the Democrats’ health reform 2.0 agenda could be passed through reconciliation.  For that, no small degree of thanks is owed to the precedent created by Paul Ryan and his fellow repealniks in the GOP congressional caucus.

The problem with Obamacare is (still) politics

This week’s announcement of large premium hikes across the health insurance marketplaces has brought another round of Obamacare hand wringing. The average premium on silver plans on exchanges across the country is set to rise by 25 percent this year. Worse, competition is dwindling on the exchanges, as one in five shoppers will have to choose from plans offered by only a single insurance company.

This has left many once again wondering what the problem is with Obamacare, and whether the law is failing. And once again, the core problem with Obamacare comes down to politics.

Obamacare has achieved remarkable successes. It has driven the uninsurance rate to historic lows. Between the law’s Medicaid expansion, marketplace enrollment, and adult children remaining on their parents’ insurance plans, 20 million people have gained coverage from Obamacare, with another million expected to sign up during the coming enrollment period. The law guarantees a right to purchase insurance for those with preexisting conditions, and outlaws insurer-imposed caps on annual coverage. It has also corresponded with a dramatic slowdown in U.S. healthcare spending.

But there is persistent unease (to put it mildly) on the law’s health exchanges. Big insurers have found it hard to create financially viable exchange products, and the exchanges are quickly turning into marketplaces for Medicaid-type plans and customers. The recent premium spikes just add to the exchanges’ struggles.

Now it should be noted that most Obamacare customers will not pay the full sticker price of these increases. The increases reported are before federal subsidies kick in. These subsidies will insulate most shoppers from major premium shock.  Moreover, enrollees in previous years have proven remarkably willing to change plans in response to price changes, and could do so again this year.

Still, the pre-subsidy premium increases do reveal an ongoing turmoil in the marketplaces. There are four principal reasons for rising premiums:

1) Insurers systematically underpriced premiums during the first years of enrollment. Premiums rose by just 2 percent in 2015 and 7 percent this year. By jacking up premiums this year, insurers are bringing prices in line with earlier expectations. In fact, average premiums for 2017 are now in line with Congressional Budget Office forecasts before the law was enacted.

2) Important insurer protections in the law were allowed to lapse, exposing participating insurers to higher costs and risks. The law’s risk adjustment mechanisms insulated insurers from higher-than-anticipated costs from a sicker population enrolling in their plans. This encouraged insurer participation and kept premiums low. However, Republicans latched on to risk adjustment as an insurer bailout. Senator Marco Rubio, looking to bolster his anti-Obamacare cred, maneuvered a repeal of risk insurance through Congress this year. The lack of risk adjustment is now reverberating into insurers exiting the marketplaces and customers facing higher premiums.  (Good job, Marco!)

3) The mix of customers on the exchanges is older and sicker than expected. The administration originally hoped that young adults would account for 38 percent of all enrollees. Their actual share of enrollment has only would up being just 28 percent. Enrollment in general has been lower than the administration predicted. But a relatively older and less healthy population of enrollees incurs higher costs for insurers, causing premiums to increase.

4) There is less competition on the exchanges than anticipated. Some insurers are finding it hard to turn a profit and exiting the exchanges altogether. More and more parts of the country are being left with fewer and fewer choices. Without competitive pressure, insurers can raise prices without losing enrollment, essentially controlling the market.

There are relatively straightforward solutions to these problems. We should restore risk insurance mechanisms. And to encourage enrollment (particularly among the young and healthy), we could stiffen the individual mandate penalty, while simultaneously sweetening the law’s subsidies and cost-sharing benefits. And to generate competition, we should create a public option, at least in those states with too few private insurance offerings.

Paul Waldman relays several more good ideas for improving the law from Paul Starr of the American Prospect, including:

  • “Require all insurers who want to sell in the individual insurance market to offer their plans through the exchange, so they couldn’t cherry-pick individuals outside the exchange . . .
  • “Reduce the waiting period for those on disability insurance to get Medicare coverage from two years to six months to move some of the very high-cost enrollees out of the individual-market pool.
  • “Require any insurer that wants to offer a Medicare Advantage plan in an area also to offer a plan in the marketplace for under-65 enrollees.
  • “Have the federal exchange adopt the procedures used by California in actively bargaining with plans instead of acting as a passive clearinghouse[ ].
  • “Create a public option for those aged 55-64 clearly identified as an early buy-in to Medicare.
  • “Create a second federally run public option for enrollees from 18 to 54.
  • “Restore the risk corridor and reinsurance provisions that have expired that were intended to protect exchange plans against adverse selection.”

These are all positive solutions to Obamacare’s woes. Expanding Medicare eligibility for near retirees and the newly disabled would help remove some high-cost patients from the exchanges, thereby taming premiums for everyone else. California actively negotiates better prices for consumers as a condition for insurers to list on its exchange. Because of that, premiums in California are rising by just 5 percent this year. Letting the federal exchange negotiate too would put downward pressure on premiums for more customers in more states.

But while these ideas are great in theory, most have little plausible path to becoming law. Hillary Clinton hopes to build on Obamacare by increasing subsidies and creating public options.  Yet Republicans in Congress have little interest in doing anything to shore up the law.  Six years after passage, the conservative anti-health reform fever has yet to break, and massive resistance remains firmly in place.

The conceptual foundations of Obamacare are not broken; only its politics are. We know what we need to do to improve the law, but the logjam of health politics in Washington has locked the rushed, imperfect bill passed in 2010 into a stasis that hasn’t been imposed on any other piece of major social legislation in American history. Big laws need tweaking and fixing along the way, but Congress just won’t do that for Obamacare.

Jonathan Chait is right when he argues that Obamacare has been a policy success but a political failure. But it’s more complicated than the law being a substantive triumph with a public relations problem. Obamacare’s PR problem is now actively hindering its substantive real-world success. If the law had broader political support, reasonable reforms could get passed, and its exchanges would be made more functional.

So for all the actuarial and wonkish analysis of what ails Obamacare, its core problem remains political. Republicans have no interest in rectifying the law, and many probably actively hope it crumbles from wont of legislative care and maintenance. Obamacare does not require a fundamental overhaul or a desperate rejiggering. What it needs is a legislative majority interested in its success.

The real problem with Obamacare

What happens to a universal healthcare system dependent on private insurers when those insurers don’t show up?  The good people in Pinal County, Arizona, may be about to find out.

On Monday, Aetna announced that it was withdrawing from two-thirds of the states where it had previously been selling Obamacare plans on state marketplaces.  This threatens to leave many communities with much slimmer insurance options, and Pinal County without a single insurance offering available on its health exchange in 2017.

Amazingly, Obamacare never anticipated this circumstance.  Its drafters assumed that at least some insurers would sign up to sell insurance everywhere in the country.  And they didn’t create any kind of fail-safe or backstop in the event that private insurers bailed en masse.  The only mechanism the federal government has to enlist insurers into Pinal County (or any market, for that matter) is to plead and cajole.

Sure, Pinal County is just one unfortunate insurance black hole for now.  But Aetna has reported the same struggles that a number of other insurers (but by no means all) have had in the marketplaces: sicker than expected enrollees, and insufficient risk compensation.  As more and more insurers head toward the Obamacare exit, more states and counties will be left with one or no insurance choices.  So Pinal County may just be the tip of the iceberg.

There are a number of ways we could shore up the health exchanges to avoid this dilemma.  The fundamental problem Aetna and other insurers have encountered is that Obamacare enrollees have been disproportionately sicker and expensive to insure.  To stabilize the marketplaces and make insuring these enrollees a viable business, one (or both) of two things needs to happen: the exchanges need to enroll more healthy people, or else insurers need to be compensated for taking on the risk of insuring a sicker population.

To enroll Obamacare’s relatively healthy opt-outs, policymakers could take two different tracks.  For one thing, they could make the penalty for going without insurance stiffer.  Raising the cost of disregarding the individual mandate will, naturally, persuade more people to comply and buy insurance.

For another, policymakers could make the insurance offerings on the exchanges more appealing.  Many people fall between a rock and a hard place under Obamacare.  Bronze plans provide cheap but flimsy coverage, with low premiums and high out-of-pocket costs.  Silver plans, on the other hand, provide better coverage but are more expensive.  At the same time, the government kicks in cost-sharing subsidies for silver plans but not bronze.  This is meant to encourage more people to spring for better coverage, but also creates a gulf between the silver and bronze plans that many people seem to be falling into.

So some of the uninsured are logging on to their state’s exchange and seeing a silver plan they can’t afford and a bronze plan with outrageous deductibles.  Faced with this unpleasant choice, some consumers are just throwing their hands up and walking away.  And those most likely to say “thanks but no thanks” are the young and healthy, who feel the safest to gamble by going uninsured.  These are the exact consumers insurers need to draw in to stabilize their marketplace business.

There are clear ways to close this gulf and make Obamacare’s plans more attractive to more people.  We could make the law’s tax credit subsidies more generous to make silver plans more affordable.  Or we could extend cost-sharing subsidies to bronze plans to help cushion the cost of deductibles and co-pays.

The problem is that either of these things requires legislative action to constructively improve the law—something that Congress has shown no appetite for.  Instead, it has gone the other direction entirely, voting over and over and over to repeal the law in total.

While repeal efforts have failed, congressional Republicans have succeeded in weakening the law in ways that have made it harder for insurers to operate.  For instance, the law originally provided several mechanisms to compensate insurers if the marketplaces’ first few cohorts of enrollees proved to require more care (and therefore more costs) than anticipated.  Republicans slammed these mechanisms as an insurer bailout.

Eager to rack up some anti-Obamacare bonafides during his failed presidential campaign, Senator Marco Rubio succeeded in gutting one of these risk adjustment provisions.  This crippled a number of the law’s insurers, and particularly the non-profit co-op start-up companies authorized by the law as a replacement for the abandoned public option idea.  Now, even Aetna attributes part of its decision to exit on the law’s “current inadequate risk adjustment mechanism.”

So the health exchanges could be shored up by making insurance more desirable for more people, and by boosting (rather than kneecapping) the law’s compensation for insurers that take on added risk.  But perhaps a deeper structural fix is needed.  Even these reforms still leave universal coverage dependent on the voluntary participation of private insurers.  By letting the private sector provide a fundamental right, the government leaves itself vulnerable to demands and rent-seeking from for-profit corporations (which some speculate is already happening).

Michael Hiltzik argues that insurers shouldn’t be able to cherry-pick only the lucrative public health programs.  “If you want to reap the profits from participating in public health programs,” he writes, “you’ll have to participate in the Affordable Care Act too.”

That’s one option.  But there’s another option that has a history of bipartisan support, and that’s providing a public health insurance option in markets without enough (or any) private offerings.  It’s an idea that was supported during the law’s drafting by both Republican Sen. Olympia Snow and Obama’s then-Chief of Staff Rahm Emanuel.  Obama himself recently seemed to revive something like this as a way to contend with lagging competition across the exchanges.

This would reconceive the public option as a backstop—as an insurer of last resort in communities that aren’t adequately served by the private market.  It would inject competition and keep prices low.  And unlike private insurers, the public plan could be regulated from monopoly pricing if it’s the only insurer in town.  So if all else fails, consumers would at least be able to buy affordable coverage from a publicly-run insurer.

And indeed, Obamacare should have this kind of backstop.  Universal healthcare shouldn’t be left at the mercy and whims of private insurers, and shouldn’t be subject to the veto of countless decisionmakers.  That’s why Obamacare created the fallback option of federally-run exchanges if states refused to create state marketplaces (as 37 ultimately did).  Consumers in those states shouldn’t lose out on affordable health insurance just because their elected officials decided not to participate in Obamacare.

The same is true within the exchanges.  Private companies shouldn’t get the final say on whether universal healthcare gets to be actualized.  That was never in the intent or spirit of the law, but it’s what you get when you graft a universal health insurance program on to a predominantly privately-run system with no general public fallback.  Now that insurer non-participation is becoming a live reality, Congress must step up and create the fallback option that should have been there in the first place.

Like all major new social insurance systems, Obamacare, in its extraordinary complexity, needed tweaking after enactment.  But Congress has adamantly refused to do this, continuing to attack the law’s very existence.

Aetna held the door open for one day returning to the Obamacare business, saying that it “may expand [its] footprint in the future should there be meaningful exchange-related policy improvements.” We know what those improvements are, but we just aren’t doing them.  There are flaws in Obamacare’s design, but those aren’t what are truly getting in the way.  The real problem with Obamacare is our broken political system.