House Republicans on Monday released their long-awaited healthcare bill, but the plan would only repeal major parts of Obamacare starting in 2020 — when the political world will be engulfed in the next presidential election.
This implementation timeline raises major questions about whether, if Republicans were able to overcome the current legislative hurdles and pass this plan into law, its version of repeal would actually ever go into effect.
House conservatives have already raised alarms about a number of elements of the plan, even describing it as Obamacare 2.0. Though the plan aims to repeal a lot of taxes, spending and mandates within Obamacare, it also preserves much of the law's regulatory structure and also includes a new form of federal subsidies toward the purchase of health insurance.
The payoff for conservatives in all of this is supposed to be that it phases out two major provisions of Obamacare: the Medicaid expansion and subsidies toward the purchase of insurance on government-run exchanges, which together are slated to cost about $2 trillion over a decade.
However, under the bill as proposed, the Medicaid expansion would still be funded by the federal government through the end of 2019. Only starting on Jan 1. 2020 will the GOP reform start to go into place, which would transition Medicaid into a system in which each state receives a certain amount of money for each of its residents in the program and has more flexibility over how the program functions. That allocation would revert to per person spending levels from 2016 and then grow each year at the rate of medical inflation. However, states would still receive enhanced Obamacare-levels of spending for individuals who were grandfathered in by having enrolled in expanded Medicaid before 2020.
Likewise, Obamacare's subsidies for individuals to purchase insurance on government-run exchanges would be available until the beginning of 2020.
What this means is that Obamacare's two major spending provisions will carry on for nearly the next three years, and millions more people could theoretically be signing up for coverage through the program during this time.
Republicans, who are struggling to handle the messaging about Obamacare beneficiaries losing coverage, would be setting themselves up so that the brunt of any disruption would be happening in January of an election year in which they'd be defending the Senate seats they won in their wave election year of 2014. The party would also have to be defending the presidency and fighting over control of the state governments that will redraw the boundaries for Congressional districts, which will have a major implication on House control in the coming decade.
And this is even assuming they maintain their same majorities after 2018. Republicans, though facing a favorable Senate map that year, still have to plan for the possibility that their majorities could be reduced — if not lost — given the historical tendency of the incumbent party to lose seats in midterm elections and the volatile nature of the Trump presidency.
If Democrats gain control of even one of the chambers of Congress, they could put the brakes on the plan to repeal Obamacare. There's no guarantee that President Trump, should he seek reelection, would hold the line on repeal. A long-time proponent of single-payer healthcare who has vowed to cover everybody, he may decide he doesn't want to go into his reelection year explaining away cuts to healthcare subsidies and Medicaid spending.
This could set up a situation similar to the "fiscal cliff" surrounding the expiration of the Bush-era tax cuts at the start of 2013, with legislatures scrambling in the wee hours to come up with a compromise. It's easy to see how lawmakers could just get together and decide to punt on the issue until after the presidential election.
Though the political temptation for a transition period on Obamacare is understandable, the problem is that delaying the implementation of repeal doesn't give states and health insurance markets enough time to adjust to the new system before Republicans have to face voters in 2020. Under the proposed plan, Democrats can run on their apocalyptic warnings about repeal in 2018 and then run in 2020 on whatever implementation hiccups are likely to occur in states as they work through the new system.