A Friendly Reminder That Defunding Obamacare Won't Stop the Law

Much of the law’s implementation is separate from annual discretionary appropriations.

With Capitol Hill wrapped up in a debate this week regarding looming fiscal fights and the possibility of a shutdown over the health care law, it’s worth remembering that shutting down the government would likely have little impact on the Affordable Care Act. According to a Congressional Research Service report released at the end of July, much of the law’s implementation is separate from annual discretionary appropriations.

The CRS report was issued at the request of Sen. Tom Coburn, R-Okla., who has not been shy about his opposition to the shutdown strategy. “[A government shutdown] would be committing ritual suicide on an altar of bad strategy,” Coburn’s communications director, John Hart, told National Journal Daily. “The idea that we can fully defund Obamacare through the continuing resolution is a Washington gimmick to advance political funding goals.”

The report substantiates the argument that a shutdown would not be an effective tool to stop the law. This is because much of the law relies on mandatory funding and multiple-year and no-year discretionary funds, which are not beholden to annual budget debates.

In fact, a government shutdown is quite different from the way it is commonly viewed by the public. Although the lapse in discretionary budget authority would likely impact some day-to-day routine operations of the government—such as the National Park Service—essential and necessary functions of the government and ones that have relevant health-based concerns would continue. Social Security and Medicare would likely continue in large part because they are mandatory programs; health reform under the ACA would also be considered essential for public health and would largely continue to be funded.

“Funding for state-operated insurance exchanges [in the ACA] is a distinct mandatory funding source,” Center for Budget and Policy Priorities Senior Fellow Paul Van de Water said. “In the case of all the federal government’s direct activities—including funding for federally run exchanges—it looks like the bulk of it could continue with no obvious end in sight if there were a shutdown.” Although some smaller effects are possible, this means that the main elements of the law would continue for some time, including the insurance exchanges, subsidies, and the individual mandate.

Also, agencies have prepared contingency plans in the event of a government shutdown, and the Health and Human Services plan maintains funding for many of its programs. “The HHS shutdown contingency plan that was prepared in anticipation of a possible government shutdown in FY 2012 indicated that ACA implementation activities at CMS would continue because of the mandatory funding provided in the law,” the CRS report says. The only real way to strip the law of these mandatory funds would be to repeal the full law.

And while Congress has the power to precipitate a shutdown, much of the jurisdiction over how a shutdown would be implemented lies with the agencies and executive branch, and is written into these contingency plans. Even some Republicans supporting the strategy of tying Obamacare to the CR debate recognize that it would not have the practical effects they truly want. “It’s mostly symbolic,” Sen. James Inhofe of Oklahoma said recently. “We want to have something out there so people continue to talk about it.... That’s a way of keeping the issue alive.... It is something you have to keep doing because you have strong beliefs, and even if logically it isn’t going to work out the way you want it, you still try.”