Republican lawmakers say the costs of implementing President Obama’s health care law represent a ripe target for money-saving cuts, as Congress fights over the best way to avert an automatic and indiscriminate budget ax set to come down Friday.
But the Obama administration is unlikely to allow the president’s top domestic achievement to suffer much more than a glancing blow from the so-called sequester.
The two agencies most responsible for carrying out the Affordable Care Act’s reforms — the Department of Health and Human Services and the Treasury Department — make no mention of the law in letters they sent to Senate appropriators to outline the dire effects of the automatic cuts, or sequesters. Rather, health care officials called attention to sharp reductions in HIV testing, medical research at the National Institutes of Health and clinical care for American Indians and Alaskan Natives.
Even so, the contentious law known as Obamacare may not escape unscathed.
“These large and arbitrary cuts will have severe impacts across the government,” HHS spokesman Bill Hall said. “The sequestration law impacts all affected discretionary programs, so any such programs under [Centers for Medicare and Medicaid Services] or the ACA would be impacted.”
For example, the federal grants designed to help states set up insurance marketplaces, or “exchanges,” in the states under Mr. Obama’s law would be subject to 7.6 percent cuts totaling $66 million, according to estimates issued in September by the Obama administration’s Office of Management and Budget.
The Prevention and Public Health Fund — a state-by-state fund set up by the health care law to proactively fight disease and illness — also would be subject to the sequester to the tune of $76 million.
Those projections were made before additional wrangling over the sequester, including a last-minute New Year’s deal to avoid the “fiscal cliff.” Now, the sequestration calls for an annual reduction of roughly 5 percent of nondefense programs and 8 percent for defense programs, Mr. Hall said.
“However, given that these cuts must be achieved over only seven months instead of 12, the effective percentage reductions will be approximately 9 percent for nondefense programs and 13 percent for defense programs,” he added.
The exchange program is a key pillar of Mr. Obama’s law and designed to help those without employer-based health plans buy insurance with tax credits starting in 2014. More than half of the states have asked the federal government to run their exchanges for them, while others are performing the task in-house or are partnering with the federal government.
Despite the looming sequesters, one Senate Republican aide said Monday that the president’s signature health care reforms are “definitely well-insulated.”
“Their problem is the task, not money,” the aide said of the administration’s efforts to roll out key aspects of the law in the coming months.
West Virginia Attorney General Patrick Morrisey told The Washington Times this week that implementation is behind schedule, so it makes sense to delay it.
His comments echo those of high-profile Republicans, who have taken to the Sunday talk shows to call on Mr. Obama to delay his reforms or offer them as bargaining chips in the bitter dispute about how to rein in the nation’s deficit.
“Just delay the [Medicaid] expansions, delay the health care exchanges so they can work with states on waivers, on flexibility,” Louisiana Gov. Bobby Jindal said last weekend on NBC’s “Meet the Press,” arguing that it would save tens of billions of dollars “and you’re not even cutting a program that’s started yet.”
Several Republican governors, most notably Rick Scott of Florida and Chris Christie of New Jersey, have warmed to a second, optional pillar of the law — expanding Medicaid within their borders at the start of 2014.
Medicaid and other mandatory programs such as the Children’s Health Insurance Program are exempt from sequestration, but there will be a 2 percent cut in Medicare payments to health care providers.