All over the country, people are worried about how Obamacare will affect the cost and quality of their health coverage. Members of Congress and their staffs were especially panicked, because it appeared that the Affordable Care Act required them to purchase coverage on the laws new insurance exchanges, but without the generous subsidy they receive for their current coverage. Capitol Hill collectively exhaled yesterday, when it came out that the U.S. Office of Personnel Management would allow members and their staffs to keep their insurance subsidies.
Obama gets personally involved
According to John Bresnahan and Jake Sherman of Politico, President Obama has personally involved himself in the controversy over whether or not Congressmen and Hill staffers should retain access to their insurance subsidies. “It is extraordinarily rare, to say the least, for the president of the United States to get involved in an inside-the-Beltway flap over the payment of health care premiums,” note the Politico authors.
They also report that “some lawmakers have privately threatened to push through a legislative fix—possibly attached to a must-pass spending bill—that would require the government to continue its contributions for health care premiums for Hill employees.” But the White House fears that such a legislative change would “open a door for Obamacare opponents to try to unwind other parts of the 2010 legislation, and senior administration officials want to avoid that step.”
The text of the law is unclear
The dispute goes back to 2009, when Sen. Chuck Grassley (R., Iowa) slipped an amendment into Obamacare that requires members and staffers to get their coverage on the new exchanges, instead of from the Federal Employee Health Benefits Program, or FEHBP.
Section 1312(d)(3)(D) of the Affordable Care Act states it clearly: “The only health plans that the Federal Government may make available to Members of Congress and their congressional staff with respect to their service as a Member of Congress or congressional staff shall be health plans that are created under this Act…or offered through an Exchange established under this Act.”
But as with so many other sections of the law, crucial details of how this is supposed to work were left out. First: Will staffers have to buy insurance on the exchanges for themselves with after-tax money, or will the government be able to contribute to these costs with a pre-tax contribution? Second: In the past, the governments sponsorship of health benefits for members and staffers counted toward retiree benefits. If these individuals are placed on the exchange, will their pensions will be affected?
OPM has taken forever to issue its ruling
The U.S. Office of Personnel Management is in charge of filling in the blanks on this particular issue. OPM was supposed to let members and staffers know of their decision around Memorial Day, according to my sources. But the months have come and gone, with enrollment on the exchanges starting on October 1, with silence from OPM.
“I dont care what the answer is,” fumed Sen. Tom Coburn (R., Okla.). “Give us an answer so that if we want to do a legislative fix to take care of the people who actually work for us,” we can. “I mean, theyre going to be the only set of federal employees that actually get paid by the federal government that have to go into the exchange. [OPM knows] the answer—they just wont share it. And I want time to legislate on it before we lose half our staff.”
Because most Congressional staffers are poorly paid, but are paid enough to not have eligibility for the Obamacare subsidies that low-income Americans will receive, losing their current health insurance subsidies would be a big financial blow. Many members fear that their staffers would leave for better-paying jobs in response.
But Bresnahan and Sherman now report that OPM has decided to allow the government to subsidize coverage for its employees on the exchanges. “A White House official confirmed the deal,” they report, “and said the proposed regulations will be issued next week.”
Federal employees should eat their own cooking
Its a good thing that members of Congress and their staffs will have to shop for coverage on the exchanges. It will give the people writing our laws some insight into the health-care system they have foisted upon the rest of us. But the subsidies they will receive—however justified—will partially insulate them from the degree to which Obamacare drives up the cost of individually-purchased health insurance.
Employees of the IRS and the Department of Health and Human Services should also be required to join Obamacares exchanges. Not surprisingly, federal employees are unhappy about that prospect. The labor union representing IRS agents has urged its members to tell Congress that they are “very concerned” about such an outcome.
At a House Ways and Means hearing yesterday, acting IRS commissioner Danny Werfel endorsed this view. “I can speak for myself—I prefer to stay with the current policy that Im pleased with, rather than go through a change,” said Werfel. Werfel likes his plan, and wants to keep his plan, as President Obama promised he could. Not all Americans will have that luxury.
Original Source: http://www.forbes.com/sites/theapothecary/2013/08/02/congressmen-rejoice-govt-to-subsidize-their-health-insurance-through-obamacares-exchanges/