Maybe there is finally something Democrats and Republicans can agree on — fixing the Affordable Care Act.
Republicans have tried to repeal Obamacare since it became law, calling it unworkable and unaffordable. Until this year, Democrats have held the line for the president. Not now.
After the president leaves office, change will come. The first will be to repeal the so-called Cadillac Tax, the 40 percent excise tax on generous health care plans, which is scheduled to begin in 2018.
According to the president, the excise tax is one of the main revenue sources for the ACA, helps curb health care costs, and is a big deterrent to income inequality in health care. It is also a way to fill an $87 billion budget gap.
Repealing the Cadillac Tax is supported by key business groups that have been looking for ways to make the ACA more affordable. Repeal is also supported by organized labor, which negotiated generous health care benefits as part of their union contracts. The tax would hit taxpayers, as well, who pay for the health care benefits of government workers, teachers, firefighters and police.
According to a poll commissioned by the U.S. Chamber of Commerce and other national business organizations, 72 percent of Americans oppose the tax.
For Democrat presidential front-runner Hillary Clinton, opposing the president on his health care excise tax is low-risk because even her primary rival, Sen. Bernie Sanders of Vermont, agrees. Clinton has lobbied for mandated health care coverage since 1992 when she was first lady.
She thought she had the prototype when Democrats took control of the Washington state Legislature in 1992 when our new governor, Mike Lowry, a former Democrat congressman, jammed through a law that required employers — except those with union contracts — to provide standardized employee health care plans designed by the state.
The crack in the Washington law was it needed a waiver from the federal ERISA law in order to mandate that Washington employers provide the state-approved insurance coverage. ERISA was put in place in 1972 to ensure that a company’s employee benefits were uniform from state to state.
When the ERISA waiver failed, Gov. Lowry signed legislation that allowed groups of small employers to band together in associations in order to offer health insurance. By forming large associations, small employers gained the same leverage as big corporations to negotiate lower employee health care premiums.
That law has worked, and today those associations provide affordable health coverage for more than a half million workers and their families.
Nationally, the U.S. Supreme Court decided the mandate issue in 2012. By a 5-4 margin, the court ruled that the ACA is constitutional and gave its blessing to the law’s most controversial component, known as the “individual mandate.” The mandate requires all Americans to purchase health insurance or pay a “shared responsibility payment” to the government. In 2016, that fee will be 2.5 percent of annual income or $695 per person, whichever is higher.
The court held specifically the individual mandate is not a “penalty,” as the health care law identified it, but a tax, and is therefore a constitutional application of Congress’s taxation power.
While the Supreme Court deflated attempts to bring down the Affordable Care Act, the Democrat’s most recent rebellion against key parts of Obamacare signals that both parties are now in the mood to figure out how to pay for the ACA and make health insurance affordable.
In a time when our federal deficit is soaring and will soon pass $19 trillion, taxpayers cannot afford to pay another $1.2 trillion between now and 2025 to pay for Obamacare as we know it today.
Don Brunell, retired as president of the Association of Washington Business, is a business analyst, writer, and columnist. He lives in Vancouver and can be contacted atTheBrunells@msn.com.
