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January 07, 2013

Congress Continues to Raid New Health Care Law

Posted in: healthcare

The most recent fiscal cliff deal ended up cutting $1.4 billion from the Affordable Care Act’s CO-OP program. For those that don’t remember the CO-OP was designed to be a lame replacement for the public option. It was meant to help consumer by creating alternatives to for-profit insurance companies. It provides loans to start health insurance co-op’s, but they are so heavily restricted it is very unlikely they will make any noticeable impact on the market place. From Health Care Finance News:

Under the two-month patch approved by the House and Senate on January 1 to avert the “fiscal cliff” Congress has permanently cut more than $1.4 billion in funding that was earmarked to help consumer operated and oriented (CO-OP) health plans become established in all 50 states.

[...]

The CO-OP loan program has been a target of congressional Republicans from the time it was included in the Affordable Care Act. With funding initially set at $6 billion, to be awarded on merit to state-based CO-OPs as seed money, the program has already seen that funding cut nearly in half, to $3.4 billion as part of an earlier budget compromise.

If this was a one time cut to a program that seems unlikely to make a real difference it would not be a big deal, but this is part a much larger and very concerning pattern. During negotiations the ACA has repeatedly been used as a pigbank and raided to pay for other things. The CO-OP program was already cut once before in a previous deficit deal.

More significantly the exchange subsidies, which are intended to be make health insurance affordable, have been cut several times to pay for other polices. They were cut once to pay for a one year doc fix and again to repeal of the 1099 tax prevision. In addition the exchange premiums tax credits are part of the sequestration cuts.

It is only because the Supreme Court made Medicaid expansion option that it was spared from a plan to cut it as well.

Since the ACA has been signed Congress has only made the law worse. As I feared setting up like a welfare program has made it vulnerable to being cut to pay for other priorities.


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