Skip to Content

Trumponomics Daily—Tuesday, March 7

There are some critical pieces of information missing from the early analyses of the House Republican’s Obamacare replacement plan, released last night. Namely, we still don’t know how much it would cost (it doesn’t have an official estimate from the Congressional Budget Office) and what affect it will have on coverage (though it would likely cover fewer people). Needless to say, both matter. Here’s some of what we do know:

  • Much of Obamacare’s framework would remain in place, including the ban on discriminating against people with preexisting conditions and the option for young people up to 26 years old to stay on their parents’ insurance.
  • But the bill tosses the individual mandate to purchase insurance and the subsidies that accompanied it, instead offering tax incentives to compel people to buy coverage on the open market. People who drop coverage for longer than two months would face what is effectively a stiff fine, in the form of a year-long, 30% premium surcharge, to buy back in.
  • It would temporarily preserve Obamacare’s Medicaid expansion — which accounted for roughly half of the new coverage the law achieved — allowing new enrollees until 2020. States that haven’t yet opted to participate in the expansion could do so until then. It would also impose a new cap on payouts for patients in the program.
  • The highest-earning households would pay less, and insurance company executives could see a pay bump. The bill would repeal a pair of taxes that Obamacare imposes on the wages and investments of the wealthiest Americans to help pay for broader coverage. And it scraps a $500,000 limit on the amount of C-suite salaries that insurance companies can claim as a tax-deductible business expense.

The proposal is already beset by challenges from within GOP ranks. From the party’s right flank, members of the ultraconservative House Freedom Caucus, joined by Kentucky Sen. Rand Paul, are deriding it as Obamacare Lite. Meanwhile, four senators from the party’s more moderate wing say they’ll object to any plan that “does not include stability for Medicaid expansion populations.”

Democrats for their part are pledging uniform opposition. And Rep. Jason Chaffetz (R-Utah) handed them a potentially killer soundbite this morning by indicating that the Republican proposal will take money out of people’s pockets: “Americans have choices, and they’ve got to make a choice,” he said in a CNN interview. “So rather than getting that new iPhone that they just love and want to go spend hundreds of dollars on that, maybe they should invest in their own health care.” That wouldn’t appear to square with President Trump’s promise that “everybody’s going to be taken care of much better than they’re taken care of now” under a plan that provides “insurance for everybody” and “healthcare that is far less expensive and far better.”

Republican lawmakers have little time to sift through the nuts and bolts of the plan — the House Ways and Means Committee is set to start amending it tomorrow. Stoking a sense of now-or-never urgency may be the best bet for the White House and GOP leaders to overcome Republican misgivings.

Tory Newmyer
@torynewmyer
tory_newmyer@fortune.com

Must Reads

Senator John McCain Calls on Trump to Back Up His Wire-Tapping Claim [Fortune]

The Arizona Republican says the president owes the American people any information he has to back up the explosive allegation.

Trump’s Crackdown On Tech Visas Hurts IT Services Firms [Fortune]

Shares of tech services firms fell Monday on news that the administration is temporarily suspending expedited applications for H1-B visas.

Trump Adviser Navarro: U.S and Germany Should Discuss Trade Outside EU [Fortune]

Trump’s new trade czar wants to engage in bilateral talks with the Germans around reducing the $65 billion between the U.S. and the European industrial powerhouse.

Number of the day

500,000

The new subscribers that the New York Times expects to have netted over a six-month period by the end of March. Other legacy print titles are seeing their own election-related surges: The New Yorker saw subscriptions leap 230% in the three months following the election; in January, the Atlantic doubled signups over the same month last year.

Loose change

How the Breitbart-Led Media Ecosystem Elected Donald Trump [Fortune]

Airbnb Deletes Trump Tower Listing Amid Security Concerns [Fortune]

Donald Trump’s Worst Deal [New Yorker]