Tag: obamacare subsidies
With Unity And Grace, Democrats Can Build Powerful Midterm Message On Shutdown

With Unity And Grace, Democrats Can Build Powerful Midterm Message On Shutdown

The shutdown is winding down as eight Senate Democrats (7 Democrats and one Independent who caucuses with Democrats) voted with Republicans to get to the 60 votes needed to reopen the government. The ensuing spending plan will not include the health coverage subsidies for which the Democrats were holding out.

There is a lot of legitimate anger at the “defectors.” If you were going to cave, why wait until day 40? With public opinion leaning your way, why let up? Especially when this is the only leverage you’ve got? And how can you shake hands with these thoroughly untrustworthy Reppublicans, who have blatantly and illegally ignored previous spending allocations? All for the promise of a show vote on the health-coverage tax credits next month, a vote that will almost surely fail?!

Also, some of what the moderate Democrats are claiming they “got” in the deal are not at all Republican concessions, specifically rehiring government workers illegally laid off during the shutdown and “fully funding SNAP.” Simply getting the other side to obey the law may look like a win these days, but it is not.

Still, there are a number of arguments that point the other way, ones I’d argue are more compelling, though if and only if the fight we saw in the shutdown regarding who’s fighting for whom continues to rage. If these moderates don’t work with the rest of the Democratic caucus to build on the political and messaging gains made during the shutdown, then they really are part of the problem, not part of the solution.

The main argument for ending the shutdown was that the Ds were not going to get the tax credits and too many people were feeling the brunt of the shutdown. The former is probably true; the latter is definitely true.

The group of people affected by the shutdown grew with each week, beyond the hundreds of thousands of federal workers who have not been paid for weeks. The Trump administration’s legal fight to avoid paying SNAP food assistance benefits put tens of millions of Americans at risk of going hungry. And its decision to ratchet back air traffic capacity ensnared millions of others in air travel disruptions and flight cancellations that began over the weekend.

Given that these two facts—probable loss on tax credits and spreading pain—were highly predictable from the start, why shutdown at all? For one, minority leader Schumer understood that the party was itching for a fight with what is, hands down, the worst, most spineless GOP Senate caucus of any of our lifetimes. On a daily basis, they bow before their corrupt leader and violate their vows to protect the Constitution.

Granted the leverage that shutdown gave them, Senate Democrats had to pitch a fight. And they pitched a uniquely strong one. They made the Republicanss own the highly potent health-care (un)affordability issue, and they’ll get another chance to elevate that issue next month when Republicans continue to stand by while 20-plus million people see their premiums spike.

My sense, backed by some polling evidence, with the most important polls being last Tuesday’s mini-blue-wave, is that a very important sentiment is clarifying among voters: the Trump administration doesn’t care a whit about their economic concerns but the Democrats do.

I grant you, that last bit—”the Democrats do”—is an uphill battle and is just now maybe coming into focus. The shutdown underscored that for Republicans, unaffordability and cruelty are spectator sports. This leaves Democrats as the only party in the game. No question, the party is suffering from years, if not decades, of being perceived as abandoning working-class economics, in many cases, justly so. But during the shutdown, they were clearly the party fighting for affordable health care, for SNAP, for government workers, while the Republicans were weaponizing the moment to push hard in the wrong direction on each of these issues.

This is the fight that Democrats won in the shutdown, even if they lost on tax credits. But if they stop here, they’re toast, and deservedly so. I could be wrong—maybe this time is different—but in a few months, most regular folks won’t remember the shutdown. These events have historically had a very short half-life.

But if they start here, if they learn from this shutdown that they can unify around the message of affordability, of competent governance that follows the rule of law, of elevating the hurt that this administration, backed by a do-nothing, wholly-compliant Congressional majority, is doing to large swaths of Americans on a daily basis, then the shutdown will have been worth it.

Jared Bernstein is a former chair of the White House Council of Economic Advisers under President Joe Biden. He is a senior fellow at the Council on Budget and Policy Priorities. Please consider subscribing to his Substack.

Reprinted with permission from Econjared.

President Trump

Tariff Dividend Checks For Dummies (Who Run America's Policy Debates)

I learned basic arithmetic skills in third grade. I wasn’t exceptional, everyone in my public school third grade class learned them. Of course, we all can now use computers to have calculations done for us in a fraction of a second. But still somehow, we have major national debates that show zero understanding of even the most basic arithmetic.

The latest example is the $2,000 tariff dividend check that Trump is promising us. The arithmetic here is about as simple as it gets. We have roughly 340 million people in the country. Let’s say 10 percent don’t get the check because they meet Trump’s category of “high-income.”

That leaves over 300 million people getting Trump’s $2,000 checks. That comes to more than $600 billion. Trump’s tariffs are raising around $270 billion. That means we will be paying out $330 billion more in Trump tariff dividend checks than he is raising in tariff revenue. That is adding $330 billion to the deficit. That is from the same guy who is making an obsession of paying down our national debt.

And just to be clear, we were already looking at a budget deficit for 2026 of $1.8 trillion. If we add $330 billion, the deficit for the fiscal year will be $2.1 trillion. To put this in simple language that even a reporter for a major national news outlet can understand, Trump is proposing to add $2.1 trillion to the debt in 2026, he is not paying it down.

I acknowledge not being a deficit hawk and am not terrified by a deficit of this size, which is roughly seven percent of GDP. But I suspect most of the politicians in Washington are, and certainly anyone who thinks we need to be paying down the debt should be screaming bloody murder.

But watching the reaction in major media outlets, there seems almost no appreciation of the fact that Trump was floating what would ordinarily be considered a very large increase in the deficit. In fact, if Trump were to give this tariff dividend check every year over the next decade, it would add close to $4 trillion to the debt (counting interest payments), almost as much as the big tax cut Congress approved earlier this year.

It’s also worth comparing Trump’s tariff dividends to other items in the news. The government shutdown was in large part over the $35 billion in annual payments for enhanced subsidies for people buying insurance in Obamacare exchanges. Trump and Republicans in Congress claimed that we didn’t have the money to pay for these subsidies. Trump’s tariff dividend checks would cost more than 17 times as much as the enhanced insurance subsidies.

To make another comparison, Trump saved us around $6 billion a year by shutting down PEPFAR, the program that has saved tens of millions of lives by treating people in Africa for AIDS. This means that Trump’s tariff dividend checks will cost us 100 times as much as the AIDS program that he said we couldn’t afford.

And just to throw in one more comparison, the annual appropriation for public broadcasting was $550 million. Trump’s tariff dividend checks would cost more than 1000 times as much as the government’s payments for public broadcasting.

People can differ in their views on how important it is to save lives in Africa or provide people here with healthcare. They may also differ in their assessments of how important deficits are, but it really would be good if media outlets could make knowledge of third grade arithmetic a job requirement for reporters who deal with budget issues. It should be their job to provide meaningful information to the public on the topic. Letting someone talk about $2,000 dividend checks, and also about paying down the debt, is a sick joke.

Dean Baker is a senior economist at the Center for Economic and Policy Research and the author of the 2016 book Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich Richer. Please consider subscribing to his Substack.

Reprinted with permission from Dean Baker.

Republicans Push Skimpy, Unaffordable Health Coverage As Costs Keep Rising

Republicans Push Skimpy, Unaffordable Health Coverage As Costs Keep Rising

The median cost of employer-based health insurance this year leaped ahead at nearly twice the rate of the consumer price index, according to the annual Kaiser Family Foundation employer survey released yesterday. Sadly, workers are bearing a larger share of the increased burden through rapidly rising co-premiums.

The press coverage this morning of the closely followed survey emphasized the combined top-line increase of 5.5 percent for a family plan, which now stands at a staggering $26,993 a year or about the price of a new compact car. The cost of an employer-based individual plan rose at the slightly lower rate of 4.6 percent to $9,325 a year.

But a deeper dive into the numbers provides a better understanding of why people are so upset about rising health care costs. Employee co-premiums for a family plan (the amount deducted from paychecks) rose 7.6 percent on average to $6,850. The employer share went up only 4.8 percent. The net effect was a downward shift in the share paid by employers and a corresponding upward shift in the share paid by their employees, which was a half percentage point more or 25.4 percent of the total.

This increased burden on workers comes after an eight-year period when the employer share of premiums rose fairly steadily (with a few years off early in the pandemic). Companies offset some of those increases by funneling more of their workers into plans that raised their out-of-pocket expenses for deductibles and co-pays.

Depending on the plan type (HMO, PPO, high-deductible), the average deductible from employer-based family plans now ranges from $3,118 to $5,095 a year. Fully a third of workers and their families enrolled in high-deductible plans for 2025, up from 28 percent the previous year and the most ever.

Put the two together, and the median family (half pay more, half pay less) now pays anywhere from $9,968 to $11,945 a year for health care or close to $1,000 a month. Given the median household income in 2024 stood at $83,730, that translates into anywhere from 12 percent to 14 percent of a typical family’s income.

Things are about to get a lot worse. Next year’s premiums and co-premiums for employer-based plans, which cover an estimated 154 million people, are set to rise six percent to seven percent, according to a new survey by Mercer, a health care benefits consulting firm. If the split between employers and their employees remains the same, that will exceed wage increases by two to three percentage points. Wage increases have been trending down for the past three years, falling to just 4.1 percent this past August, the last month reported by the Bureau of Labor Statistics before the government shutdown.

Source: Atlanta Federal Reserve

No wonder health care costs now ranks as the second most important issue for inflation-weary Americans, just behind the deteriorating state of the overall economy. More than four in five of 1,300 adults surveyed in mid-October by the Associated Press and the NORC Center for Public Affairs said health care issues were extremely or very important to them personally. That was nine percentage points more than crime and 23 percentage points ahead of immigration — the next two biggest concerns.

The impact of ACA/Medicaid cuts on employer plans

The outlook for employer-based plans will also get a lot worse if Democrats fail to restore the Medicaid cuts and the enhanced subsidies for Affordable Care Act plans (which provides affordable insurance for tens of millions of low-wage workers, gig workers and sole proprietors). An estimated 7.3 million people who purchased subsidized exchange plans will drop ACA coverage, with more than half becoming uninsured, according to a Commonwealth Fund brief.

Many will look for cheaper, non-ACA compliant plans that don’t quality for listing on the exchanges because they provide skimpier benefits, are not required to provide free preventive care, can discriminate based on prior medical conditions, and often carry extremely high deductibles and co-pays. This summer, the Trump administration announced it wouldn’t enforce the rule approved by the Biden administration in mid-2024 that limited such plans to three months duration.

“Those who sell non-ACA plans … will absolutely see the coming open enrollment as an opportunity to push their plans as more affordable alternatives, without sharing full information with consumers about the limits of those plans,” said JoAnn Volk, a professor at Georgetown University’s Center on Health Insurance Reforms.

What happens when people who previously had Obamacare buy skimpy plans or become uninsured? They postpone care until their conditions require emergency room treatment — the most expensive place to obtain health care. When struck by serious illnesses like cancer, heart attacks and strokes, they often fail to pay their uncovered bills, or resort to Go Fund Me campaigns to pay off their high deductibles. Some will negotiate long-payoff periods and live the rest of their lives burdened by medical debt. Some will declare bankruptcy.

Hospitals and physicians, in turn, will raise their prices to cover the cost of uncompensated care, which will cause private insurance rates to rise even more. Rising prices, rising insurance premiums, and rising uninsured rates is an accurate description of what existed in the U.S. before passage of the ACA.

These health care economic fundamentals are of little interest to the modern-day Republican Party, which invariably includes some variation of bare-bones insurance as one of their answers to the affordability crisis. Early in the shutdown, they floated ideas like instituting new income caps on Obamacare subsidies, establishing minimum co-pays, and cutting off subsidies for new enrollees, none of which they would agree to negotiate until the government is reopened.

Then, last week, Politico reported they are also willing to beef up tax credits for investing in health savings accounts, which could be used to buy skimpy plans. Lower-income workers generally avoid HSAs since they can’t afford the voluntary deductions needed to fund them.

I can’t predict when or how the shutdown crisis will end. But I am pretty confident that I know what will happen to health care costs in the next few years given Republican control of Washington. They’re going up, up, and up.

Merrill Goozner, the former editor of Modern Healthcare, writes about health care and politics at GoozNews.substack.com, where this column first appeared. Please consider subscribing to support his work.

Reprinted with permission from Gooz News

Markwayne Mullin

Report: Trump Sent Mullin To Deal With Democrats As Shutdown Spooks GOP

As the government shutdown stretches into its second week, President Donald Trump has taken matters into his own hands, enlisting one of his closest Senate allies to open a direct channel to Democrats, Politico reported Tuesday.

The report noted that Trump’s decision to personally “deputize” a senator for backchannel discussions caught GOP leaders off guard, further complicating a fractured Republican strategy that has struggled to present a united front.

According to the report, “the administration has informally deputized Sen. Markwayne Mullin (R-Okla.) to serve as a conduit to Democrats. Asked about the arrangement, Mullin said, ‘I don’t have a badge,’ and otherwise declined to discuss whether he was briefing the administration on bipartisan Senate talks.”

“I would like to see a deal made for great health care,” Trump said Monday in the Oval Office, adding that he had been in talks with Democrats.

But hours later, he reversed course on his Truth Social platform, posting: “I am happy to work with the Democrats on their Failed Healthcare Policies, or anything else, but first they must allow our Government to re-open.”

The conflicting signals prompted a scramble among GOP leaders.

The report further noted that House Speaker Mike Johnson (R-LA) told reporters Tuesday he had spoken with Trump “at length” and reiterated that reopening the government should come first.

Senate Majority Leader John Thune (R-SD), meanwhile, acknowledged “ongoing conversations” but showed signs of frustration with the president’s messaging.

According to the report, behind closed doors, aides say the White House and Capitol Hill Republicans have repeatedly clashed over strategy, often without coordination.

Much of the tension is said to stem from hardline tactics pushed by Trump’s budget chief, Russ Vought, who has championed measures targeting blue-state spending and federal worker protections — gambits that have not moved Democrats but have drawn GOP leaders into awkward defensive postures.

A new memo from the White House budget office on federal worker back pay is the latest example.

Both Johnson and Thune had previously supported guaranteed pay for furloughed employees, yet the administration appeared to waver.

Asked about it Tuesday, Trump offered a murky answer: “For the most part, we’re going to take care of our people, but for some people they don’t deserve to be taken care of.” The report noted that Thune, visibly caught off guard, admitted he wasn’t familiar with the memo’s legal rationale but added, “All you have to do to prevent any federal employee from not getting paid is to open up the government.”.

The GOP appears split over how to handle both the shutdown and the broader health care debate,.

Johnson and Thune have pressed to delay health care negotiations until the government is open, while Trump’s interest in negotiating with Democrats — particularly over Affordable Care Act subsidies set to expire — has opened a new front in the standoff.

“The Administration will not negotiate while the American people are being held hostage by Democrats,” Jackson said.

Republicans had hoped to make Democrats bear the political cost of the shutdown, especially those in the Senate who are blocking the House-passed stopgap bill.

“If you’re Republicans, you have to get Dems to blink first,” a source close to the White House told the outlet.

But Trump and Vought have largely ignored that plan, opting instead to pursue broader political goals — from punishing the federal bureaucracy to letting premiums spike in Democratic-leaning districts.

That approach has only widened the rift within the GOP, with conservatives like Rep. Marjorie Taylor Greene (R-GA) criticizing leadership for ignoring skyrocketing healthcare costs.

“Not a single Republican in leadership talked to us about this or has given us a plan to help Americans deal with their health insurance premiums DOUBLING!!!” Greene posted on the social platform X.

Johnson, attempting to downplay the criticism, responded: “She’s probably not read that in on some of that, because it’s still been sort of in the silos of the people who specialize in those issues.”

Democrats, meanwhile, have seized on the Republican dysfunction.

Senate Majority Leader Chuck Schumer read Greene’s post aloud on the Senate floor, saying, “Hold on to your hats: I think this is the first time I’ve said this, but on this issue, Rep. Greene said it perfectly.”

Despite the GOP disarray, some quiet bipartisan efforts are underway in the Senate to find a path forward. Lawmakers are considering potential compromises tied to ACA subsidies and unresolved budget issues.

But with Trump now actively engaging in his own strategy and Republicans still at odds over the next move, a resolution remains elusive.

One Senate Republican, who was not named, told Politico: “They are absolutely struggling to figure out how they are going to get out of this.”

Reprinted with permission from Alternet

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