Congress might still fix Obamacare this year

Rick Newman
Senior Columnist

If you follow the woeful efforts in Washington, D.C., to improve the nation’s health care system, you probably think nothing will ever get done. You may be surprised.

Congressional Republicans have tried and failed three times this year to overturn the Affordable Care Act, which led a frustrated President Donald Trump to halt a key subsidy by executive order in October. That action is expected to push premiums up for some people and, ironically, cost the government money, because it’s obligated by law to cover premium increases for certain ACA participants.

Two senators, Republican Lamar Alexander of Tennessee and Democrat Patty Murray of Washington, have introduced a bill that would restore the subsidies Trump stopped, stabilizing the ACA market. It would also let states make changes to the ACA that some Republicans feel is necessary. It’s not a radical bill, like prior GOP repeal efforts. And it wouldn’t enshrine Obamacare, as the ACA is known, forever, as some Democrats want.

But it might actually pass—and bring common-sense fixes to a few important problems.

“The Alexander-Murray bill is a patch that shores up market stabilization,” Douglas Holtz-Eakin, president of the American Action Forum and former director of the Congressional Budget Office, said at the Yahoo Finance All-Markets Summit on Oct. 25. “That needs to happen. This is something everyone knows would be a good idea, but politically is not favorable.”

Alexander-Murray’s naysayers

Some Republicans don’t like the Alexander-Murray bill because they don’t want to vote for anything short of complete ACA repeal. And Trump has derided the subsidies he canceled as “bailouts for insurance companies.” Some Democrats, meanwhile, feel the bill would let too many people opt out of Obamacare, weakening the insurance pools that are essential for the program to work.

That’s what a bipartisan bill often looks like, however, it displeases purists but appeases those willing to accept imperfect solutions. And Congress has ways of passing those sorts of bills, such as bundling a raft of unpopular comprises into a catch-all bill that might pass in a hurry at the end of the year. “I view that as a non-unlikely scenario,” Holtz-Eakin said, akin to 50-50 odds.

“Watch Chuck Schumer,” said Greg Valliere, chief global strategist at Horizon Investments, at the summit. The Senate Minority Leader is likely to press for including the Alexander-Murray bill as must-pass legislation as 2017 draws to a close. That will come as Republicans are touting their plan for big tax cuts, which will depend upon Congress passing a variety of spending bills. That’s when Schumer will have maximum leverage. “Schumer will get a deal in December,” Valliere predicts. If he does, there will still be plenty of problems with the nation’s overpriced and inefficient health care system. But Obamacare will get a rare breather.

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Rick Newman is the author of four books, including Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman