House Leaders Working on Obamacare Stabilization

Caitlin Owens reports that a pair of House Republicans—one a moderate and one an archconservative—are working on a bill to stabilize Obamacare:

Reps. Tom MacArthur and Mark Meadows are working together on an individual market stabilization package, according to a senior GOP aide. It will include funding for the Affordable Care Act’s cost-sharing reduction payments to insurers, although it’s unclear for how long….One crucial piece, according to a second GOP aide, is an agreement on “very flexible 1332 waiver language” in exchange for CSR funding. The state waivers are an important priority for conservative Republicans.

This is the most obvious short-term compromise possible. If the CSR subsidies go away, premiums will go up about 15 percent next year. Not only will that be really unpopular, but it would, counterintuitively, cost the government a bundle since the higher premiums will generate higher subsidies. Meanwhile, conservatives have been pushing for a long time for waivers that allow states to run health care systems radically different from Obamacare.

Needless to say, the devil is in the details. On the CSR side, they key is how long the funding would be guaranteed. Appropriations can only be made for two years, but it’s possible to convert the CSR subsidies into mandatory spending that doesn’t require an appropriation. That would make it permanent. On the waiver side, everything depends on just how far the waivers go. Conservatives want a blank slate. Moderates and liberals want to keep some of the key provisions of Obamacare, like essential benefits and tax subsidies.

I’m pretty sure that a bill like this can’t be passed under reconciliation (the 1332 waivers wouldn’t qualify), so it would need 60 votes in the Senate. That means it needs to be acceptable to Democrats, not just Republicans.

It’s possible that something with this at its core could be doable. Stay tuned.