Orszag: Even If They Win, Republicans Can't Kill Obamacare

The president's former budget director is skeptical of GOP plans to repeal or subvert the Affordable Care Act in the wake of the Supreme Court decision.


The Supreme Court decision upholding President Obama's health-care legislation last week has renewed Republicans' zeal to kill the Affordable Care Act in the only way they still can -- by repealing it in Congress. But the president's former budget director, Peter Orszag, doesn't think it will be possible.

"If the Senate does not flip Republican [in November] and/or if President Obama is reelected, you're not going to see repeal writ large," Orszag told me in an interview at the Aspen Ideas Festival. "Even in the configuration where Romney wins and there's a Republican Seante and the House is Republican also, it is much more difficult to do than many people anticipate."

That's because the reconciliation process that would allow the GOP to get repeal through the Senate with just 51 votes has technical requirements that could pose arguments, Orszag said.

Notes from the Aspen Ideas Festival -- See full coverage

"Reconciliation is intended to be used only for deficit reduction, and the provisions all have to be budget related," he said. "The official scoring shows that the ACA reduces the deficit, which means that repealing it increases the deficit, so you'll have to come up with some other something" to make up the difference.

Nor does Orszag believe many states will end up staying out of the ACA's Medicaid expansion, something the Supreme Court ruled they be allowed to do. Numerous GOP governors now are making noises about taking advantage of this ruling to buck Obamacare, but Orszag believes the funds that come with the expansion will eventually be an offer they can't refuse.

"On the one hand you have some governors who are clearly saying, 'We're not going to apply it,'" he said. "On the other hand, the subsidies are very deep. You have 100 percent federal financing for a few years, and then, even out over time, you have 90 percent of the cost of the initial enrollees being covered by the federal government."

For the same reason states accepted and built upon Medicaid to begin with -- a desire to help the poor -- they will get on board with the new funding in the long run, he predicted.

"Over time, I suspect whatever the initial reaction is, it will become, maybe not impossible, but difficult to resist a 90 percent subsidy rate," Orszag said. "That is a really, really significant subsidy for people who can benefit from health-care coverage."

Orszag, who has sometimes been critical of the Obama Administration since he departed and took a position with Citigroup, agreed with those who have faulted the White House's PR effort on the ACA.

"I would agree with those who have raised some questions about the effectiveness of the communications strategy around the health-care push," he said. "I don't think anyone could go out and credibly claim that the communications around the health bill has been an A-plus effort."

The administration, he said, allowed the legislation's opponents to define it by failing to put enough focus on all the benefits of the law.

"There's been a very successful effort to brand Obamacare as something that's actually inconsistent with what's in the legislation, in part because what's in the legislation is never explained," he said. "It's 'death panels' and 'government takeover of health care' and all these things that are actually not accurate."

And Orszag called on the administration to propose bolder measures to improve the economy through a combination of short-term stimulus spending and long-term deficit reduction.

"That's basically the structure that the administration has adopted, but it's kind of half-hearted on both sides, and without a lot of detail, frankly, on the long-term deficit reduction," he said. "I think the risk in that half-hearted version is you're not doing enough to spur the economy in the short run, and you're also, on the long-term deficit stuff, allowing Rep. [Paul] Ryan and others to take the deficits in Medicare and Medicaid and use them as an excuse to destroy the village in order to save it."

Ryan, the Republican chair of the House Budget Committee whose proposed budget would dramatically restructure Medicare, has been allowed to take control of the debate, Orszag said.

"We do not need to go down as radical a path as Mr. Ryan has proposed with either Medicare or Medicaid to shore them up," he said. "And by not having as many specifics as might be desirable, I think it's harder to challenge Mr. Ryan. The response is always, 'That's great, but what's your plan?'"