Washington
First order of business for the returning Congress: The No Bailout for Insurance Companies Act of 2014.
Make it one line long: "Sections 1341 and 1342 of the Affordable Care Act are hereby repealed."
End of bill. End of bailout. End of story.
Why do we need it? On Dec. 18, the chairman of the Council of Economic Advisers was asked what was the administration's Plan B if, because of adverse selection (enrolling too few young and healthies), the insurance companies face financial difficulty.
Jason Furman wouldn't bite. "There's a Plan A," he replied. Enroll the young.
But of course there's a Plan B. It's a government bailout.
Administration officials can't say it for political reasons. And they don't have to say it because it's already in the Affordable Care Act, buried deep.
First, Section 1341, the "reinsurance" fund collected from insurers and self-insuring employers at a nifty $63 a head. This yields $20 billion over three years to cover losses.
Then there is the "risk corridor" provision that mandates a major taxpayer payout covering up to 80 percent of insurance-company losses.
Never heard of these? That's the beauty of passing a bill of such monstrous length. You can insert a chicken soup recipe and no one will notice.
The whole scheme was risky enough to begin with, but things have gotten worse.
First, the administration postponed the employer mandate. Then, it exempted from the individual mandate people whose policies were canceled (by Obamacare). And for those who did join the exchanges, Health and Human Services Secretary Kathleen Sebelius is "strongly encouraging" insurers to — during the "transition" — cover doctors and drugs not included in their clients' plans.
The insurers were stunned. Told to give free coverage. Deprived of their best customers. Forced to offer stripped-down "catastrophic" plans to over-30 clients (contrary to the law). These dictates, complained their spokesman, could "destabilize" the insurance market.
Shrinking revenues and rising costs could bring on an unbalanced patient pool forcing huge premium increases that would further unbalance the patient pool as the young and healthy drop out.
End result? Insolvency — before which the insurance companies will pull out of Obamacare. Solution? A huge government bailout. It's already baked into the law.
Which is why the GOP needs to act. Without viable insurance companies doing the work, Obamacare falls apart. No bailout, no Obamacare.
Such a bill would be overwhelmingly popular, because Americans hate fat-cat bailouts. The GOP House should pass it and send it to Harry Reid's Democratic Senate.
Do you really think vulnerable Democrats up for re-election will vote for a bailout? And who better to slay Obamacare than a Democratic Senate — liberalism repudiating its most important creation of the last 50 years.
Want to be even bolder? Attach the anti-bailout bill to the debt ceiling. That and nothing else.
In the past, Republicans made unrealistic and unpopular debt-ceiling demands — and lost badly. They learned. Last year, Republicans presented one simple unassailable debt-ceiling demand — that the Senate pass its first budget in four years. Who could argue with that? The Senate capitulated within two days.
Who can argue with no bailout? Let the Senate Democrats decide — support the bailout and lose the Senate. Or oppose the bailout and bury Obamacare.
Happy New Year.
Charles Krauthammer writes for The Washington Post.