All the political skirmishing around the looming government shutdown has obscured the critical reason for it in the first place: Republicans have essentially stopped saying they want to repeal Obamacare, but quietly, they are doing exactly that.
Over the past nine months, Republicans have gone a long way toward dismantling key Obamacare provisions under the misleading guise of reforming or improving our health care system. As a result, more than 20 million Americans face higher insurance premiums next year. And almost 14 million Americans could lose their health insurance altogether over the next decade — an estimated 3.3 million in 2026 alone.
That’s more than 70 percent of those who gained coverage since Obamacare went into effect.
You may be forgiven for missing this headline. There wasn’t one. In 2016, Donald Trump ran on a promise to abolish the program and kept up his crusade throughout his first term, only to have the effort deep-sixed by Senator John McCain. This time around, Mr. Trump has rarely — if ever — mentioned the Affordable Care Act by name. Nor have his fellow Republicans.
But they never stopped trying. And this year they have made substantial progress. The outcome of the looming shutdown will determine whether Democrats can gain back at least a modicum of ground.
Death by Many Cuts
Since most of its provisions went into effect in 2014, Obamacare has been stunningly successful at reducing the ranks of the uninsured: from 44.4 million in 2013 to 26.7 million in 2016.
Then three months ago, Congress passed its huge tax and spending package (known as the One Big Beautiful Bill). Tucked into that legislation were a number of granular, difficult-to-comprehend changes to the government piece of our health care system, particularly Medicaid.
One of them, a work requirement for able-bodied adults, is likely to strip health care coverage from millions of Americans who lack the resources to navigate government bureaucracy. According to the Congressional Budget Office, over the next 10 years, that provision will cost 5.3 million people their coverage.
Other changes were so obscure that only dogged health care aficionados can understand them.
Today Americans making less than $150,000 a year who bought insurance on one of the Affordable Care Act’s exchanges can receive a tax credit to offset part of the cost of their coverage. Republicans chose not to extend that tax break in the tax and spending bill. Now, without government intervention, it will expire at the end of the year. That could be responsible for more than a quarter of the lost coverage, and it’s likely to be the focal point of any negotiations during a possible shutdown.
Affordable Care
Passed during the Biden administration, this tax break has helped many of the 24 million Americans who purchased their insurance through the exchanges in two ways. It has slashed existing premiums for lower-income Americans. Plus, it has capped premiums for those earning from just above $60,000 to $150,000 annually — a group that under the prior system suffered a huge premium jump — at 8.5 percent of income.
Not surprisingly, people rushed to take advantage of this new benefit; more than 19 million now receive the tax break, up from 10 million before the enhancement.
How Much More?
Even upper-income Americans who buy insurance on the Affordable Care Act exchanges will be hurt by the repeal of this tax break. That’s because as coverage gets more expensive, healthier people drop their insurance first, forcing companies to raise premiums on their remaining customers to maintain profitability.
And those increases will be big. Premiums are expected to soar an additional 18 percent, based on the planned rate increases insurers have filed (assuming the loss of the break). That compares with a 7 percent increase imposed a year ago.
Thanks to Republican legislators, a 55-year-old couple making $85,000 annually could see their health insurance cost more than triple, to $24,535 a year. Obviously that’s unaffordable, which is why so many will drop coverage.
And that will just add to the tragedy of tens of millions of Americans lacking what should be a basic benefit in the richest country in the world. Whether you agree with a shutdown or not, it’s good to understand that it’s not over nothing.
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Graphics by Taylor Maggiacomo. Additional research by Kasey Chatterji-Len.
Steven Rattner is a contributing Opinion writer and was a counselor to the Treasury secretary in the Obama administration. @SteveRattner • Facebook
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