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Saturday, October 22, 2016

June may be the cruelest month.

The U.S. Supreme Court is expected to rule soon on a case involving tax rebates for the purchase of health insurance. The impact of this ruling cannot be overstated.

The Affordable Care Act allows states to create their own health insurance markets through which state residents can buy policies. Depending on income and other individual factors, residents may be eligible for tax rebates for the purchase of insurance. If a state declines to establish its own exchange, state residents may still buy government-subsidized insurance through the federal exchange (

Without these tax rebates, however, health insurance would become too expensive for many otherwise healthy policyholders, driving them out of the market. If those healthy policyholders left, prices would skyrocket for those who remained, especially the sick.

The more prices soar, the more people leave.

The more people leave, the more prices soar — and the more sick people are forced out.

About 9 million residents in more than 30 states may be affected by the court’s ruling. Many could die because they can’t afford insurance, as they did in the old system before President Barack Obama and congressional Democrats passed this law in 2010.

Among actuaries and policymakers, the above description is called a “death spiral” — the slow, and then precipitous, unraveling of a health insurance market after a keystone (federal tax rebates) has been removed. If the U.S. Supreme Court rules in favor of the plaintiff in King v. Burwell, all of the above could happen, and fast.

You’d think the GOP would be happy with the judicial branch doing what the legislative branch could not. No Republicans voted for the law. Mitt Romney campaigned on repealing it. House Republicans have voted to repeal it more than 60 times. Virginia congressman David Brat recently said the health care law, also called “Obamacare,” was crippling the U.S. economy, making it more like Communist North Korea’s.

But now that the Supreme Court is poised to strike down parts of the law, the Republican Party’s leadership appears to be in a state of paralysis. If the justices rule in favor of the government, conservatives will rage. If they rule in favor of the plaintiff, the GOP, having control of both chambers of Congress, will be responsible for doing something to save a health care system, and individual lives, spinning out of control.

There is little evidence the Republicans will do anything.

Indeed, on Monday, House Majority Leader Kevin McCarthy said in essence that the Court’s conservatives are on their own. “Don’t expect us to predetermine the Supreme Court,” he said. “We have to first see what their decision is and what we have to solve.”

Why no action? Party leaders probably want to avoid appearing culpable. In doing nothing, the party can plausibly blame the Court for what will be an actuarial disaster. 

Rank-and-file Republicans, however, disagree.

They believe that doing something, anything, will reassure the high court’s conservatives that it’s OK to invalidate key provisions of the health care law without fear of jeopardizing the lives and security of an estimated 9 million Americans. Florida congressman Tom Rooney told the Wall Street Journal that “if we look like we are caught flat-footed, we may be putting into the justices’ brains that the opposition is not ready.”

But the opposition isn’t ready. It never was.

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  • Insinnergy

    Sounds awesome.

  • Dominick Vila

    Republicans don’t have an alternative to Obamacare for a very simple reason: for them the poor and the lower middle class are parasites that depend on government handouts to survive. The solution, eloquently expressed by their last presidential candidate, is not to waste our valuable time on 47% of our population who, clearly, don’t deserve their time, effort, or share of taxes. Roll out the death panels instead!
    At a time when other industrialized nations, such as Sweden who just extended PAID maternity leave for FATHERS to 3 months, we are still debating a health program, that uses for profit insurance companies, to ensure ALL Americans have access to medical care. There are some among us, including some Republican presidential candidates, who proudly propose privatizing Social Security, dismantling MEDICARE, and getting rid of every social program that benefit our most vulnerable citizens.
    The only alternative to the safety net is to lower the tax rates for the wealthiest members of our society, give them more tax loopholes and subsidies (subsidies to middle class Americans are manifestations of socialism and must be eliminated), while at the same time extending social program benefits to illegal immigrants, like Rick Perry did. When it comes to “conservatives” duplicity, cynicism, and hypocrisy need to be redefined.

    • dtgraham

      Under the employment insurance act and the employment standards act, a mother OR father may choose to commence a paid parental leave of up to 52 weeks after the child is born in Canada. It can be allocated. There are many countries that have used legislation as a method to help raise the parental leave take-up among fathers. This has been done mainly by creating individual non-transferable (transferable in Canada) periods of leave for each parent as well as additional time that can be used by either parent. Sweden is one.

      • Dominick Vila

        Incredibly, or perhaps not considering the ability of corporate America to convince mainstream Americans that we should reject what is best for us, we are still debating UNPAID maternity leave for mothers.

        • dtgraham

          I know what you’re saying Dom. There is the odd thing where it seems curious that America is still debating this. My thoughts exactly. It’s partly a cultural, pick yourself up by the bootstraps attitude but also a mindset towards taxation that’s not conducive to financing certain social programs (“entitlements” in American parlance) that you commonly see elsewhere.

          I guess it just depends on how you see things and how you view life—your values. While the U.S. is one of the best places in the world to become truly wealthy, many of the other advanced countries would be superior for those who have more limited financial prospects or encounter costly health issues.

          Though the U.S. and Canada may have similar financial structures, I can tell you that political attitudes towards the creation and redistribution of wealth are dramatically different across the 49th parallel and you are definitely going to be paying significantly higher taxes in Canada. Conservative politicians up here never talk about “class warfare” or “redistribution schemes” or ever use phrases like that. At the moment the parties are arguing over who can deliver the highest monthly child allowance (direct cash payment) to parents, and are also debating a national government daycare program for example. Conservatives are fully participating in these promises. An election is coming.

          To me, the GOP attitude on this is not just inhumane but it produces poorer results for the nation overall in the long run, if you just want to look at it dispassionately like that.

          What convinces me that you and I are on the right track politically are the so-called Gini coefficient comparisons across the world. Much is made of the “American dream”, but actually the U.S. ranks near the bottom of measurements of inter-generational upward mobility among nations. I’ve heard it said that if you want to live the American dream, move to country x or country y. For many, there’s some truth to that.

          As you said so well, how corporate America managed to convince so many mainstream Americans to reject what’s in their own best interests is a conundrum. Thomas Frank once tried to explain it.

          • plc97477

            This is not going to stay a good place to be wealthy in for long because the wealthy keep cutting off their nose to spite their face.

      • FT66

        Infact, it is applied in all of Scandinavian countries.

        • dtgraham

          Yes, in the way that the Gini coefficient uses quantitative methods to calculate social mobility among populations in various countries, the Scandinavian countries are routinely at the top of that measurement.

  • FireBaron

    Sorry Nino (that’s Scalia’s nickname). This Congress is still trying to do all it can to make Barak Obama a one-term President, even more than a year after his 2nd Inauguration! What makes you think they can act as a result of a crisis of their own making?

  • gococksri

    One wonders if Scalia seriously doesn’t understand that the Court issuing a ruling that essentially puts the ACA into a “death spiral” would simply lead us back to the same “disastrous” situation we had pre-ACA. Republicans in Congress sure weren’t concerned then. What makes him think they would be now?

    Dementia? Or is he simply enjoying the fawning attention paid him by the American Right?

  • charleo1

    I tend to believe a Conservative serving Robert’s Court will find a way to ignore the flawed language, and side with the clear intent of the law to subsidize. Otherwise they, and the Republicans would be rightly blamed for the fallout that would surely upend the entire healthcare funding system of the Country. Would certainly cause 8-9 million to lose coverage right away, with no quick fix in sight. And also undoubtedly cause another round of recession, job cutbacks, and wind up adding another trillion or so to the debt. As well as a lot of egg on the face of what has been an ACA obsessed Conservative Right, just in time for their hoped for retaking of all three branches of government in 2017. Which if successful there, would theoretically mean the Republicans could deliver a legislative death blow to Obamacare, and have a supportive White House sign the bill. Which, and this is the dishonesty of the entire Right’s sham outrage over ACA, they would incredibly fail to do. Because of the fallout of doing so, with absolutely no ideas of what to replace it with. In this sense, I almost tend to agree with Scalia’s approach of essentially wrecking the law. More so, if his healthcare were at risk. And so, forcing Congress to act. To either do the common sense thing, and fix the language. Thereby, agreeing to accept, and work for the law’s successful implementation. Or the Republicans running Congress, are forced to finally put up, or shut up about it. Either repeal the law. Or, repeal and replace it with something Or, insurance companies raise rates thru the roof, and cut coverage to make up for billions of expected lost revenue. And service providers, particularly public hospitals, unable to cope with the growing numbers of uninsured, and billions in uncompensated care, look for legal grounds to refuse admittances, and stem losses. And those grounds can be easily found in the ’86 law. If the institution doesn’t accept Medicare/Medicaid, they are exempt from being obligated to accept indigent, or uninsured patients. Yes, even on an emergency basis. Now, the training wheels are off, GOP, as thousands could die from lack of care. Obstructing is easy. Demagoguing, and creating a crisis is easy. Governing is hard, and full of risks, and responsibilities. Fraught with the strong possibilities you’ll be held accountable.

    • Allan Richardson

      Obamacare repeal would be a job stimulus for the funeral industry. 15,000 preventable young corpses before ACA because of lack of medical care: equivalent to the 9/11 attacks being repeated 5 times a year, but without the buildings going down. The ACA is not perfect (thanks to conservatives who made TRULY universal health care impossible to enact, inserted exceptions to make sure some people couldn’t be included, and sabotaged it for six years, including filing the two lawsuits to get it struck down), but we have cut that number significantly, I believe about half but do not have the exact statistics.

      Many corporations have insurance policies, payable to the company, on even their lowest level employees (it used to be only on key executives, so that the company could survive the loss of a CEO or operating VP), and since those are whole life prepaid policies, they remain in effect indefinitely, even after that employee has long left the company. In other words, it is possible that EVERY company you ever worked for, even as a teenage (or older) burger flipper, would get a big check when you die. The corporate owners of those policies thus have a financial incentive for current and former employees to die from lack of health care. That is one reason they oppose the ACA, and have spread the myth of its “bankrupting the country.”

      The total amount spent on healthcare by members of the public, including self pay doctor and hospital bills, health insurance premiums paid by individuals and employer plans, charities such as the Shriners and St. Jude’s, and government programs (Medicare, Medicaid, VA, and a few “niche” programs such as SCHIP) in this country is TWICE, per capita, the total amount spent on healthcare in other ADVANCED countries, as a percentage of GDP, and yet we get LESS FAVORABLE OUTCOMES on the average, for twice the money. The medical care available to those who can afford to pay for it is EQUAL (not superior; remember the medical advances made in other countries and then copied here), but unlike Britain, France, Germany, and even less advanced countries like Cuba (their health care under the Castro regime has been better than before Castro for decades, and they now have a vaccine against lung cancer that we do not have, for all the money we have been giving to research), THE BEST CARE IS ONLY AVAILABLE TO THE WEALTHY or the lucky.

      So the truth is, despite the myth that “government never does anything right,” we could get EVERYONE covered for HALF THE COST, maybe even less if our good old American ingenuity were channeled to HELPING people instead of finding excuses NOT to help them.


    Through out this debate, the Republicans have never articulated a coherent argument explaining why millions of Americans are better off without access to health care. Nor have they explained why they are satisfied with such a terrible return on our health care investment. GOP opposition to health care reform has been based entirely on preserving the prerogatives and profit margins of the health insurance industry.

  • dpaano

    The ONLY reason why the conservatives are so adamant about getting rid of Obamacare is because, despite the fact that it was their idea in the first place, President Obama was the ONLY one brave enough to put it out there and get it passed! That’s their ONLY problem…..they can’t possibly approve of anything that President Obama does, even if it was their idea to begin with! Pretty sad… a bunch of children in the school yard!

  • Kari Gray

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    sharing health plan ensuring natural, functional and conventional medicine.
    GreenSurance is the 2015 innovation that shatters the barrier of insurance. As a nonprofit whose mission to
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    medicine” my vote is for GreenSurance the health plan co-op.