Republicans Plan To Impose Huge Tax Increase On Middle Class In Opposing Obamacare Fix

Republicans are increasingly seeing King v. Burwell as a way to do what they couldn’t accomplish in over fifty votes–repeal the Affordable Care Act. While it defies logic, the Supreme Court could conceivably rule that the Affordable Care Act only provides subsidies for plans purchased on state exchanges but not on the federal exchange.

A majority of people want Congress to pass a simple legislative fix should this occur, guaranteeing a continuation of the subsidies for those who purchase plans over the federal exchange. The health care and insurance industries also support such a fix.

This does not mean that the Republican Party will take the rational path. The Wall Street Journal reports:

Congressional Republicans say they won’t move to preserve consumers’ health insurance tax credits if the Supreme Court strikes them down, raising the stakes in the latest legal challenge to the Affordable Care Act…

Leaders in the GOP-controlled House and Senate see the court challenge as their best hope for tearing apart a law they have long opposed. If the court strikes down the subsidies, Democrats are expected to clamor for lawmakers to pass a measure correcting the language in the law to revive them. Congressional Republicans say there is no possibility they would allow that.

“No, no, no, no,” said Sen. Dan Coats (R., Indiana). “Even Democrats have acknowledged that this needs fixing.”

That position would force lawmakers to confront people in as many as 37 states where the federal government is currently running some or all of the exchange where consumers buy plans and tap the tax credits. There are 6.1 million people in those states who have the credits for 2015, according to federal data released this week. The average tax credit this year is $4,330, the Congressional Budget Office said this week.

Eleven of the states where the federal government has a hand in running the insurance exchange – including seven with Republican governors – signed onto a brief submitted late Wednesday asking the Supreme Court to uphold their tax credits. The brief said the loss of the credits “would deprive millions of low-and moderate-income Americans of billions of dollars in federal premium assistance essential to buy health insurance, thereby disrupting state insurance markets throughout the United States.”

The brief was filed by a group of mostly Democratic attorneys general. The lone Republican, North Dakota’s Wayne Stenehjem, declined to comment…

Nobody in the Senate Republican caucus has said the party should tweak the law so it can continue as it is, particularly since such a move would preserve the unpopular requirement for people to buy coverage or pay a fine, said Don Stewart, a spokesman for Senate Majority Leader Mitch McConnell of Kentucky.

Republicans are also increasingly preparing to use the budget procedural tactic known as reconciliation to repeal large parts of the law and potentially enact alternative provisions after the court ruling, whatever the outcome. The reconciliation process allows party leaders to pass changes with a simple majority, rather than the 60 votes most bills need to clear procedural hurdles in the Senate.

A loss of the subsidies would amount to a tax increase on the middle class. Republicans tend to concentrate on lowering taxes for the wealthy, at the expense of the middle class, and therefore see no problem in this. They mistakenly believe this will not affect their more affluent supporters, who do not qualify for the subsidies. What they fail to realize is that reducing the number of people in the risk pool will result in higher premiums for everyone.

Republicans are again talking about proposing their own plan, but they have repeatedly failed at doing so. The last time the Republicans did propose a plan it was remarkably similar to Obamacare, except then it was proposed as the conservative alternative to Hillarycare.

Any Republican plan which avoids harming millions of people will not only have to provide a mechanism for assisting those who cannot afford insurance coverage. Any plan must also ensure that insurance companies could not return to denying coverage to those who have medical problems. Republicans will find that this is not so simple, and will require the type of compromises seen in the Affordable Care Act.

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2 Comments

  1. 1
    Ray says:

    I wonder how much longer the people of the USA are going to allow the GOP to keep punishing them, so the rich may get richer? Wake up people these congress members are not for America, they are for the Rich. The average citizen is nothing more then a flea on the back of the GOP dogs.
    The Founding Fathers are rolling over in their graves wondering what happen to good old American Guts?

  2. 2
    Ron Chusid says:

    Republicans are quite skilled at getting people to support them contrary to their interests, while Democrats are inept at messaging. Republicans will get away with it as long as people fall for their propaganda. As they control muc of the media (while complaining of the imaginary liberal media) and Democrats are inept at countering their misinformation, Republicans might get away with this for quite a while longer. This is especailly true when Democratic voters don’t turn out in the off year elections (again largelydue to the ineptness of Democrats politically) allowing Republicans to have influence which greatly outweights their actual support.

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