Robert Gibbs’ prediction that Obamacare’s employer mandate would — and perhaps should — be jettisoned shocked Democrats back in April.
By July, the former aide and longtime confidant of President Barack Obama had a lot more company. More and more liberal activists and policy experts who help shape Democratic thinking on health care have concluded that penalizing businesses if they don’t offer health insurance is an unnecessary element of the Affordable Care Act that may do more harm than good. Among them are experts at the Urban Institute and the Commonwealth Fund and prominent academics like legal scholar Tim Jost.
The employer mandate, Jost wrote in a Health Affairs post in June, “cries out for repair.” Repealing it “might not be such a bad idea,” if it’s replaced with something better for workers and businesses.
(Also on POLITICO: Jobs report better than expected)
Leading Democrats in Congress aren’t bolting from the employer mandate, at least not before the November election. But the White House has delayed it twice in the past year, dubbed it “not critical” and said it will be phased in more slowly when its begins next year.
The rule that businesses with more than 50 full-time workers offer them affordable health insurance has been a political headache from the start. The nonstop stream of headlines, however anecdotal, about businesses cutting jobs or shortening workweeks to skirt the coverage rules has constantly inflamed opposition to Obamacare.
Chris Jennings, a longtime health policy hand who helped the White House during the final implementation push, says the employer mandate has become a “political irritant” — although he didn’t take a stance on whether it should stay, go or be replaced with some other Democrat-blessed way of helping cover workers.
(Also on POLITICO: Reforming the VA one step at a time)
“The issue really becomes, ‘Do we need it or do we not need it?’” Jennings said. “It’s complicated to enforce; it is somewhat burdensome to some employers. But it does contribute to the underlying financing of the law.”
Republicans, of course, have always hated the employer mandate. In different times, that could make it a prime target for a bipartisan overhaul. But as with all things Obamacare, election-year politics gum up the gears. Democrats are promising to improve Obamacare, Republicans are vowing to kill it, and neither party wants to let the other score a health care point before Election Day — even when they both find fault with the employer mandate.
“Very few problems are in danger of being solved before the election,” Gibbs said in a recent phone interview. “I don’t think you can wipe away the idea that employers are going to have to contribute. I think there are just far less onerous [ways] … to do something like that.”
Democrats remain committed to the individual mandate — the core of the coverage expansion through the new Obamacare markets. And they aren’t tossing specific benefit requirements either, like the controversial birth control coverage rule that was just curtailed by the Supreme Court in the Hobby Lobby religious freedom case.
(Also on POLITICO: New twist in Common Core wars)
Gibbs predicted that political leaders will start talking more about changes to the employer mandate in the fall but that a solution will have to wait until 2015.
Other health law supporters agree that’s likely.
“We just have a situation where everybody’s stuck. Everybody’s afraid of the election,” said Jost, a law professor at Washington and Lee University. A prominent supporter of the health law, Jost has outlined several replacement ideas to help insure low-income workers.
Republicans and business groups have bludgeoned the employer mandate. They say it’s a job killer, that it’s a reason for the slow pace of the economic recovery and that compliance requires businesses to cope with a mountain of paperwork and intricate rules. Strategists say that getting rid of it would be a priority in a GOP-led Senate.
But scrapping it isn’t a snap for Democrats. The employer coverage rules were part of the ACA’s core philosophy that individuals, employers and the government should all contribute to paying health care costs. Some Democratic constituencies, including labor unions and Obamacare proponents like Families USA, still see it that way.
But the shift among liberal policy experts and advocates has been rapid. A stream of studies and statements have deemed the mandate only moderately useful for getting more people covered under Obamacare. And they too have come to see it as clumsy, a regulatory and financial burden that creates as many problems as it solves.
The main downside to eliminating the mandate, from the Democratic perspective? Money.
Estimates of the mandate’s worth to Obamacare financing range from $46 billion to more than $100 billion over a decade. That helps pay for coverage expansion. Getting a bipartisan deal to scrap the policy is one hurdle; an agreement on how to make up the money could be even harder.