Well it’s 2015 and we are again off to the races when it comes to congressional efforts to dismantle the Affordable Care Act. With Republicans capturing control of the Senate and expanding their majority in the House of Representatives leaders are teeing up a slew of legislative initiatives to repeal the ACA or at least take major chunks out of its core. The key question here is how far they will have to go to appease their base which is demanding wholesale elimination of the law.
GOP leaders have started the bidding with a series of proposed incremental changes to the ACA. First out of the gate is a bill to raise the threshold from 30 to 40 hours at which point an employer would be required to provide a worker with health insurance coverage or pay a penalty for failing to do so. This long has been a cherished goal of the business lobby, particularly in the lower-wage food service and retail sectors.
HR 30, the so-called Save American Workers Act, passed the House of Representatives January 8 on a vote of 252 to 172 with 12 Democrats joining ranks with all Republicans in support. Senate Majority Leader Mitch McConnell has vowed to bring the measure up for a vote in the Senate but Democrats are mounting a fight to oppose it, and as of this writing it remains to be seen whether GOP leaders will be able to muster the necessary 60 votes to overcome a Democratic filibuster. At least two Democrats are supporters of the measure, Joe Donnelly (IN) and Joe Manchin (WVA).
Proponents of the bill argue that the current 30 hour requirement has created a perverse incentive for employers to drop worker hours below 30 in order to avoid paying for health coverage but a number of independent research groups including the Urban Institute have issued contrary findings. In this column I have previously argued that changing the ACA definition of full-time work from 30 to 40 hours per week would in fact have a far worse effect, significantly reducing the number of people receiving employment-based coverage. And don’t take that just from me. A number of influential conservative policy analysts share this view, with Yuval Levin writing in a November 10 National Review blog post that redefining the ACA workweek at 40 hours would “likely put far, far more people at risk of having their hours cut than leaving it at 30.” Also the nonpartisan Congressional Budget Office and the Joint Committee on Taxation have estimated that it would reduce the number of people receiving employment-based coverage by approximately 1 million. This is because far more individuals work at the 40 hour level rather than 30 and thus considerably more would be at risk of having their employers cut their hours to avoid providing coverage.
CBO has also issued an estimate that HR 30 would boost the budget deficit by $53.2 billion over 10 years as large numbers of workers who lose employer coverage would be forced to enroll in programs such as Medicaid and the Children’s Health Insurance Program. Despite GOP campaign promises in the last election to slash the deficit the bill sponsors have not included any spending offsets. Oh well, that was then and now is now.
Next up in the cue may be HR 160, a bill to repeal the controversial 2.3% medical device tax, sponsored by Reps. Erik Paulsen (R-MN) and Ron Kind (D-WI). If this sounds like a broken record it also does not include any spending offsets to replace the estimated $30 billion in lost revenues.
Many conservatives outside of Congress make the case that GOP base voters want total repeal of the new law not fixes or tweaks. Writing in the Weekly Standard Jeffrey Anderson for one said that he couldn’t fathom why Republicans should be leading the charge to fix the 30 hour workweek requirement. “The focus of Obamacare’s opponents should be on repealing and replacing the overhaul, not repairing it.” He warned that GOP leaders could be falling into a trap and soon finding themselves with their fingerprints all over the law.
Anderson does have a point. While proposed incremental changes to the ACA such may be popular with corporate interests the GOP grassroots is not going to buy this one bit. They want real red meat- total repeal- or at least elimination of the individual and employer mandates and that simply put is not going to happen. Watching Boehner and McConnell attempting to appease the GOP base while at the same time actually getting some things done is going to be one interesting act to follow this year.
Chuck Loveless is a Senior Advisor at NVG, LLC