GOP Seeks to Unwind Health Care Overhaul By Starving Agencies of Funding

Their sights might be lowered, but they haven’t surrendered.

This week marks the one-year anniversary of Supreme Court arguments that resulted in the Affordable Care Act being upheld, and Republicans are re-tailoring their battle plan to fit the landscape.

Instead of pushing for a straightforward repeal by Congress -- which would never get by the Democratic-controlled Senate, let alone President Obama -- leaders are using the budgeting process to mount an attack against the agencies charged with executing the overhaul.

It’s a simple theory: If you can’t get rid of the law, sever its life source.

The largest changes included in the Affordable Care Act take effect next year -- most notably expanding Medicaid coverage to people whose income is lower than 133 percent of the poverty level -- giving Republicans who control the House the chance to snip provisions line-by-line during budget negotiations.

On March 21, the House passed a budget plan by Rep. Paul Ryan, R-Wis., that would remove funding for the law instead of trying to remove it from the books altogether.

But it’s not that simple, experts say. Such a plan might wound Obama’s landmark achievement, but would leave its vital organs intact.

“It would nibble the Affordable Care Act around the edges, but it would not get at the core of the changes,” Donald Barr, a Stanford University professor who specializes in health care reform, said.  

The difference lies within fine details in the appropriations process.

Budget plans such as Ryan’s control only year-to-year spending, called discretionary spending.

But the meat of the Affordable Care Act, including the Medicaid expansion, is mandatory spending, which means Congress can’t touch it in the year-to-year budget process.

Repealing the Affordable Care Act would save about $890 billion in mandatory spending by 2022, according to a nonpartisan Congressional Budget Office estimate provided to House Speaker John Boehner.

In comparison, the CBO predicts that discretionary spending will exceed $115 billion by 2019, although it could vary greatly based on which programs Congress decides to support. Among other things, the law authorizes Congress to spend $7.3 billion to fund public health centers and $893 million for National Health Service Corps scholarship aid in 2014. But it’s up to lawmakers whether to use it.  

“That would still leave the majority of things that the people who hate the Affordable Care Act seem to have the most heartburn about, you know, still there,” Phil Joyce, a University of Maryland public policy professor and former CBO analyst, said of the Ryan budget.  

That’s the idea behind mandatory spending: to protect large entitlement programs, such as Medicaid, Medicare and Social Security from the short-term political whims of Congress. Lawmakers must vote to repeal specific programs, making it less likely they will fall victim to meat-axing.

“That’s why it’s much harder to change the law than, sort of, even enact the law in the first place,” Joyce said.

Mandatory spending is playing a bigger role in the budget process every year. According to the Congressional Research Service, about a quarter of the federal budget was dedicated to mandatory spending in 1962, three years before President Lyndon B. Johnson signed Medicare and Medicaid into law. By 2011, it had risen to 56 percent and is projected to grow well past 60 percent by 2022.

Still, de-funding the Affordable Care Act wouldn’t go unnoticed. Such a move could further sap the Internal Revenue Service of resources to enforce the individual mandate, said Edwin Park, vice president for Health Policy at the Center on Budget and Policy Priorities.

But right now, political reality isn’t on the Republicans’ side. A budget that de-funds the Affordable Care Act would need Obama’s signature, which they almost certainly wouldn’t get, or a two-thirds majority to override a veto, which they don’t have.  

Recently though, the GOP has won some small victories. Last week’s bill to avoid a government shutdown denied the Health and Human Services Department a request for more money to cover administrative costs, including setting up state insurance exchanges.

In an interview with NPR, HHS Secretary Kathleen Sebelius said the situation was indeed difficult, but the department “would figure out a way to move forward.”

Also, across-the-board sequestration slashed domestic discretionary programs by 5.3 percent, meaning agencies will be fighting for a larger slice of a smaller pie. 

Now, Congress must pass a 2014 budget and reach an agreement on the debt limit, which is set to expire May 18.

“Under the best of circumstances, that is doing to be very rocky,” Robert D. Reischauer, a public trustee of the Social Security and Medicare trust funds, said during a panel discussion Monday at the Bipartisan Policy Center. “By the time the summer heat begins, things are going to get worse and worse.” 

Even in the face of fierce opposition, Democrats contend that the savings -- and renewed public support -- will come when the full law takes effect and people begin to see savings.

They promise that the Affordable Care Act will put a stopper in rising health-care costs and therefore lower the long-term deficit. That analysis has been backed by nonpartisan studies.

“Those savings that are contained in the Ryan budget move forward,” Rep. Lujan Grisham, a New Mexico Democrat who serves on the budget committee, said in a conference call last week. “But we repeal all the access, reopen the doughnut hole.”     

Some Republicans are still determined to repeal the Affordable Care Act, which would do away with the law’s mandatory spending increases. On Friday, Sen. Ted Cruz, R-Texas, introduced an amendment to the Democratic budget to repeal the law. The Democratic majority shot it out of the sky, as expected.  

As it has been since the law was passed, new taxes on small businesses and the individual mandate continue to fuel boiling Republican opposition.

“I am convinced that the primary reason we aren’t seeing a robust economic recovery is the uncertainty in costs associated with this health-care law,” Cruz said in a speech on the Senate floor last Friday.

Reach Reporter Ian Kullgren at Ian.Kullgren@Shns.com or 202-326-2143.