![\"Media](\"https:\/\/i0.wp.com\/www.dougsbriefcase.com\/blog\/wp-content\/uploads\/2013\/10\/Credit-huffpost.jpg\")
<\/a>Media reports indi\u00adcate that Sen\u00adate Major\u00adi\u00adty Leader Har\u00adry Reid (D\u2011NV<\/span>) and Repub\u00adli\u00adcan Leader Mitch McConnell (R\u2011KY<\/span>) are near\u00ading an agree\u00adment on tem\u00adporar\u00adi\u00adly fund\u00ading the gov\u00adern\u00adment and increas\u00ading its bor\u00adrow\u00ading author\u00adi\u00adty. [Cred\u00adit: Huff\u00adin\u00adg\u00adton Post]<\/p><\/div>Octo\u00adber 14, 2013, 7:15 am<\/em>\n Sen\u00adate lead\u00aders are report\u00aded\u00adly clos\u00ading in on a deal that would both fund the gov\u00adern\u00adment and restore its bor\u00adrow\u00ading author\u00adi\u00adty for a few months. The deal report\u00aded\u00adly con\u00adtains two changes to the health care law, one pro\u00adposed by Repub\u00adli\u00adcans, the oth\u00ader by Democ\u00adrats. The pro\u00advi\u00adsion backed by Repub\u00adli\u00adcans is polit\u00adi\u00adcal\u00adly mis\u00adguid\u00aded, unwork\u00adable and would do lit\u00adtle to impede the law\u2019s imple\u00admen\u00adta\u00adtion; the pro\u00advi\u00adsion backed by Democ\u00adrats, by con\u00adtrast, appears to com\u00adpli\u00adcate imple\u00admen\u00adta\u00adtion of a law whose launch has so far not gone smooth\u00adly. Repub\u00adli\u00adcans who oppose Oba\u00admacare should join Democ\u00adrats in seek\u00ading changes that would dam\u00adage its implementation.<\/p>\n Before going on, I would note that this blog is based on media reports out\u00adlin\u00ading the terms of a poten\u00adtial deal between Sen\u00adate Major\u00adi\u00adty Leader Har\u00adry Reid (D\u2011NV<\/span>) and his Repub\u00adli\u00adcan coun\u00adter\u00adpart Mitch McConnell (R\u2011KY<\/span>). At this writ\u00ading, no deal has been con\u00adclud\u00aded and no leg\u00adisla\u00adtive lan\u00adguage is avail\u00adable, so there remains a good deal of fuzzi\u00adness about the poten\u00adtial agree\u00adment. I\u2019ve elect\u00aded to post this any\u00adway, in an effort to keep pace with rapid\u00adly chang\u00ading events. But I do so with a caveat that I will state more explic\u00adit\u00adly lat\u00ader in the post.<\/p>\n Here are the deal\u2019s broad out\u00adlines, as report\u00aded last night by The Hill<\/a> and Roll Call<\/a>:<\/p>\n \u2022 Gov\u00adern\u00adment fund\u00ading would be pro\u00advid\u00aded through Jan\u00adu\u00adary 15;<\/p>\n \u2022 Its bor\u00adrow\u00ading author\u00adi\u00adty would be extend\u00aded through Feb\u00adru\u00adary 7 or 15;<\/p>\n \u2022 A new com\u00admit\u00adtee would be cre\u00adat\u00aded to for\u00admu\u00adlate bud\u00adgetary pro\u00adpos\u00adals by Decem\u00adber 13;<\/p>\n \u2022 At Repub\u00adli\u00adcan insis\u00adtence, the gov\u00adern\u00adment will more scrupu\u00adlous\u00adly check the income of appli\u00adcants for health insur\u00adance to deter\u00admine whether and to what extent they might qual\u00adi\u00adfy for sub\u00adsi\u00addies; and<\/p>\n \u2022 At Demo\u00adc\u00adra\u00adt\u00adic insis\u00adtence, a tax levied on every\u00adone who cur\u00adrent\u00adly has employ\u00ader-spon\u00adsored cov\u00ader\u00adage would be delayed for one year.<\/p>\n The pro\u00advi\u00adsion authored by Sen\u00adate Repub\u00adli\u00adcans is aimed pri\u00admar\u00adi\u00adly at peo\u00adple with rel\u00ada\u00adtive\u00adly low incomes. In states that have cho\u00adsen to expand their pro\u00adgrams, peo\u00adple with incomes under 138 per\u00adcent of the fed\u00ader\u00adal pover\u00adty line<\/a> ($15,856 for an indi\u00advid\u00adual, $32,223 for a fam\u00adi\u00adly of four) will be eli\u00adgi\u00adble to enroll in Med\u00adic\u00adaid. In all states, those with incomes between 100 per\u00adcent ($11,490 for an indi\u00advid\u00adual, $23,550 for a fam\u00adi\u00adly of four) and 400 per\u00adcent ($45,960 for an indi\u00advid\u00adual, $94,200 for a fam\u00adi\u00adly of four) of pover\u00adty will be eli\u00adgi\u00adble for sub\u00adsi\u00addized pri\u00advate health insur\u00adance cov\u00ader\u00adage sold through the exchanges.<\/p>\n The Admin\u00adis\u00adtra\u00adtion recent\u00adly announced that it will deter\u00admine eli\u00adgi\u00adbil\u00adi\u00adty for these sub\u00adsi\u00addies in 2014<\/a> based on what crit\u00adics have called an \u201chon\u00ador sys\u00adtem\u201d \u2013 they will take an appli\u00adcant at their word and not require him or her to doc\u00adu\u00adment income unless it was more than 10 per\u00adcent low\u00ader than what IRS<\/span> and SSA<\/span> data indi\u00adcate. Ver\u00adi\u00adfy\u00ading the income of all appli\u00adcants, the Admin\u00adis\u00adtra\u00adtion con\u00adclud\u00aded, would be far too dif\u00adfi\u00adcult and time-con\u00adsum\u00ading, so they have delayed that ver\u00adi\u00adfi\u00adca\u00adtion for a year.<\/p>\n The impend\u00ading deal, accord\u00ading to press reports, would elim\u00adi\u00adnate the one-year delay in income ver\u00adi\u00adfi\u00adca\u00adtion. The pro\u00advi\u00adsion would have lit\u00adtle prac\u00adti\u00adcal effect. The exchanges are strug\u00adgling to com\u00adplete their most basic func\u00adtion: telling peo\u00adple which plans are avail\u00adable and how much they would cost, some\u00adthing that the pri\u00advate sec\u00adtor, through por\u00adtals such as ehealth\u00adin\u00adsur\u00adance, has been doing suc\u00adcess\u00adful\u00adly for 20 years. If gov\u00adern\u00adment exchanges can\u2019t pull that off smooth\u00adly, how can they be expect\u00aded to under\u00adtake more com\u00adpli\u00adcat\u00aded pro\u00adce\u00addures? More than like\u00adly, the Admin\u00adis\u00adtra\u00adtion will agree to this pro\u00advi\u00adsion, then sim\u00adply not car\u00adry it out.<\/p>\n This is also a poor\u00adly con\u00adceived pro\u00advi\u00adsion from a polit\u00adi\u00adcal per\u00adspec\u00adtive. Con\u00adgres\u00adsion\u00adal Repub\u00adli\u00adcans inex\u00adplic\u00ada\u00adbly forced a gov\u00adern\u00adment shut\u00addown over a demand that they knew the Sen\u00adate and the Pres\u00adi\u00addent would nev\u00ader meet \u2013 defund\u00ading Oba\u00admacare. Now they con\u00addi\u00adtion their sup\u00adport for reopen\u00ading the gov\u00adern\u00adment and avert\u00ading default on an insis\u00adtence that the law be enforced as written.<\/p>\n And enforced against peo\u00adple whose incomes make the pur\u00adchase of insur\u00adance most bur\u00adden\u00adsome. Many of these peo\u00adple, after all, can ill-afford to spend thou\u00adsands of dol\u00adlars on health insur\u00adance, but are being forced by the gov\u00adern\u00adment to do so. They earn a frac\u00adtion of what Mem\u00adbers of Con\u00adgress do. The gov\u00adern\u00adment is allow\u00ading those Mem\u00adbers to col\u00adlect much larg\u00ader sub\u00adsi\u00addies, despite a pro\u00advi\u00adsion in Oba\u00admacare that pre\u00advents them from receiv\u00ading those sub\u00adsi\u00addies<\/a>. There is some\u00adthing polit\u00adi\u00adcal\u00adly unap\u00adpeal\u00ading about some\u00adone who earns $174,000<\/a> and col\u00adlect\u00ading sub\u00adstan\u00adtial pre\u00admi\u00adum sub\u00adsi\u00addies demand\u00ading that some\u00adbody earn\u00ading $34,000 jump through hoops to get a small\u00ader pre\u00admi\u00adum subsidy.<\/p>\n The Democ\u00adrats, by con\u00adtrast, have includ\u00aded a more polit\u00adi\u00adcal\u00adly attrac\u00adtive pro\u00adpos\u00adal that could, depend\u00ading on how it is writ\u00adten, seri\u00adous\u00adly dam\u00adage the suc\u00adcess of Oba\u00admacare. At the behest of labor unions, Democ\u00adrats have report\u00aded\u00adly includ\u00aded a pro\u00advi\u00adsion that would delay what is, in effect, a tax on all peo\u00adple enrolled in plans spon\u00adsored by employ\u00aders (and labor unions). Begin\u00adning Jan\u00adu\u00adary 1, these plans will be assessed $63 per enrollee<\/a> to sub\u00adsi\u00addize health insur\u00aders who are par\u00adtic\u00adi\u00adpat\u00ading in the exchanges. That adds up to a $10 bil\u00adlion sub\u00adsidy for such com\u00adpa\u00adnies [sec\u00adtion 1341<\/a>]. It is meant to cush\u00adion the loss\u00ades that such insur\u00aders will encounter when they cov\u00ader peo\u00adple whose med\u00adical bills great\u00adly exceed their premiums.<\/p>\n Assum\u00ading the accu\u00adra\u00adcy of press accounts of the pro\u00adposed deal, this delay in rein\u00adsur\u00adance pay\u00adments could be dev\u00adas\u00adtat\u00ading to insur\u00aders who are sell\u00ading cov\u00ader\u00adage through the exchanges. Obamacare\u2019s most polit\u00adi\u00adcal\u00adly attrac\u00adtive fea\u00adture \u2013 that peo\u00adple who expect to run up huge med\u00adical bills can get insur\u00adance for the same pre\u00admi\u00adum that healthy peo\u00adple pay \u2014 is what makes it least attrac\u00adtive to insur\u00aders. $10 bil\u00adlion was a pow\u00ader\u00adful induce\u00adment for them to agree to sell through the exchanges. They set their pre\u00admi\u00adums on the assump\u00adtion that they would get their share of that $10 bil\u00adlion for their most cost\u00adly enrollees. To raise the $10 bil\u00adlion, the gov\u00adern\u00adment is assess\u00ading a fee of $63 on each of the near\u00adly 159 mil\u00adlion peo\u00adple enrolled in employ\u00ader-spon\u00adsored cov\u00ader\u00adage. To raise that same $10 bil\u00adlion from the esti\u00admat\u00aded 7 mil\u00adlion peo\u00adple who will enroll in exchanges, insur\u00aders would have to hike their pre\u00admi\u00adums by an aver\u00adage of more than $1,400. But their pre\u00admi\u00adums already are set; it is too late to raise them to fill this $10 bil\u00adlion hole. Should Con\u00adgress take away their rein\u00adsur\u00adance, some plans could face big losses.<\/p>\n And that would deal Oba\u00admacare a poten\u00adtial\u00adly crip\u00adpling blow. The law sim\u00adply can\u00adnot work with\u00adout the coop\u00ader\u00ada\u00adtion of insur\u00aders. Should the rein\u00adsur\u00adance pay\u00adments be delayed, insur\u00aders will be reluc\u00adtant in the future to par\u00adtic\u00adi\u00adpate in the exchanges, ren\u00adder\u00ading the law unworkable.<\/p>\n [It\u2019s impor\u00adtant here to insert a caveat: my assump\u00adtion is that Democ\u00adrats are propos\u00ading to delay sec\u00adtion 1341 of Oba\u00admacare, which estab\u00adlish\u00ades the $10 bil\u00adlion gov\u00adern\u00adment rein\u00adsur\u00adance pro\u00adgram and funds it by assess\u00ading those with employ\u00ader-spon\u00adsored cov\u00ader\u00adage a $63 annu\u00adal fee. If the pro\u00advi\u00adsion sim\u00adply elim\u00adi\u00adnates the assess\u00adment but still requires the gov\u00adern\u00adment to pro\u00advide insur\u00aders with the $10 bil\u00adlion, then it will have no impact on insur\u00aders, although it would increase next year\u2019s deficit by $10 billion.]<\/em><\/p>\n If Democ\u00adrats are indeed will\u00ading to jeop\u00adar\u00addize Oba\u00admacare by elim\u00adi\u00adnat\u00ading a sweet\u00aden\u00ader for health insur\u00adance com\u00adpa\u00adnies, Repub\u00adli\u00adcans should fol\u00adlow suit. They should insist on delay\u00ading the indi\u00advid\u00adual man\u00addate, which impos\u00ades a new tax on the unin\u00adsured. That tax is the weapon the gov\u00adern\u00adment uses to strong-arm peo\u00adple who don\u2019t want health insur\u00adance into buy\u00ading it. Insur\u00aders who are par\u00adtic\u00adi\u00adpat\u00ading in the exchanges are count\u00ading on this pro\u00advi\u00adsion to pro\u00advide them with pre\u00admi\u00adum dol\u00adlars from healthy peo\u00adple that they can use to help pay med\u00adical bills for their less healthy enrollees. With\u00adout it, they would be put at risk of sub\u00adstan\u00adtial losses.<\/p>\n Insur\u00adance com\u00adpa\u00adnies love the man\u00addate; so does the Admin\u00adis\u00adtra\u00adtion. Few oth\u00aders do. A Kaiser Fam\u00adi\u00adly Foun\u00adda\u00adtion poll<\/a> tak\u00aden last March found it the least pop\u00adu\u00adlar among 11 pro\u00advi\u00adsions it polled. It was sup\u00adport\u00aded by just 40 per\u00adcent of respon\u00addents; none of the oth\u00ader pro\u00advi\u00adsions polled below 57 per\u00adcent. The Admin\u00adis\u00adtra\u00adtion has delayed the employ\u00ader man\u00addate by one year. Repub\u00adli\u00adcans should insist on a sim\u00adi\u00adlar delay for individuals.<\/p>\n Their oppor\u00adtu\u00adni\u00adty could come with\u00adin the next 24 hours. Should a deal be con\u00adsum\u00admat\u00aded, con\u00adser\u00adv\u00ada\u00adtives like Ted Cruz (R\u2011TX<\/span>) could use var\u00adi\u00adous pro\u00adce\u00addur\u00adal tac\u00adtics to delay its con\u00adsid\u00ader\u00ada\u00adtion. Delay increas\u00ades the risk of default. Trea\u00adsury esti\u00admates that the gov\u00adern\u00adment will be down to its last $30 bil\u00adlion<\/a> on Thurs\u00adday. It could run short of mon\u00adey to pay its bills some\u00adtime between Octo\u00adber 22 and Novem\u00adber 1, accord\u00ading to esti\u00admates pre\u00adpared by the Bipar\u00adti\u00adsan Pol\u00adi\u00adcy Cen\u00adter<\/a>.<\/p>\n If Sen\u00adate lead\u00aders con\u00adclude a deal, they will need to move fair\u00adly quick\u00adly, espe\u00adcial\u00adly since many House Repub\u00adli\u00adcans will like\u00adly reject the agree\u00adment. There is a new Sen\u00adate pro\u00adce\u00addure<\/a> under which Reid could cir\u00adcum\u00advent a fil\u00adi\u00adbuster on bring\u00ading up the bill* if he agrees to allow Repub\u00adli\u00adcans to offer at least two amend\u00adments. Repub\u00adli\u00adcans should agree to this pro\u00adce\u00addure and should make one of their amend\u00adments a delay in the indi\u00advid\u00adual man\u00addate. If the Par\u00adlia\u00admen\u00adtar\u00adi\u00adan rules that this amend\u00adment is \u201cger\u00admane,\u201d it could pass by sim\u00adple major\u00adi\u00adty; if not, it would require 60 votes. If it fails, Democ\u00adrats will be on record as sup\u00adport\u00ading one of the law\u2019s least pop\u00adu\u00adlar pro\u00advi\u00adsions. It if suc\u00adceeds, it could, along with delay of the $10 bil\u00adlion in rein\u00adsur\u00adance, effec\u00adtive\u00adly doom imple\u00admen\u00adta\u00adtion of Obamacare.<\/p>\n Delay\u00ading the indi\u00advid\u00adual man\u00addate will not be good enough for those who con\u00adtin\u00adue to insist that the Pres\u00adi\u00addent can be bul\u00adlied into agree\u00ading to defund or delay imple\u00admen\u00adta\u00adtion of his sig\u00adna\u00adture domes\u00adtic pol\u00adi\u00adcy achieve\u00adment. Many House Repub\u00adli\u00adcans may well oppose it. That will force the Speak\u00ader to rely on Democ\u00adrats to win approval of the mea\u00adsure. My sense is that he will go for\u00adward with a House vote any\u00adway, how\u00adev\u00ader reluc\u00adtant\u00adly, if that is the only way to reopen the gov\u00adern\u00adment and avert default. That will inspire even more crit\u00adi\u00adcism from the polit\u00adi\u00adcal right, which believes Boehn\u00ader to be defi\u00adcient in his hatred for Obamacare.<\/p>\n But if the final prod\u00aduct delays both rein\u00adsur\u00adance and the indi\u00advid\u00adual man\u00addate, he will have done far more to dam\u00adage the law than those who have inef\u00adfec\u00adtu\u00adal\u00adly insist\u00aded on its imme\u00addi\u00adate repeal.<\/p>\n ___________________________<\/p>\n *Tech\u00adni\u00adcal\u00adly, he would be mov\u00ading to pro\u00adceed to a House-passed tax bill, since rev\u00adenue bills must orig\u00adi\u00adnate in the House.<\/em><\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" Octo\u00adber 14, 2013, 7:15 am Sen\u00adate lead\u00aders are report\u00aded\u00adly clos\u00ading in on a deal that would both fund the gov\u00adern\u00adment and restore its bor\u00adrow\u00ading author\u00adi\u00adty for a few months. The deal report\u00aded\u00adly con\u00adtains two changes to the health care law, one \u2026 Con\u00adtin\u00adue read\u00ading