Moneybox
A blog about business and economics.

Feb. 27 2017 5:49 PM

Conservative Hardliners Are Already Threatening the House GOP's Health Care Plan

Late last week, a draft version of the House GOP's evolving Obamacare replacement leaked to the media, offering the most detailed peek yet at what Republicans might have in mind for health reform. But those still young, painstakingly laid plans already look like they might be in trouble, as North Carolina Rep. Mark Meadows, who chairs the powerful and hardline House Freedom Caucus, has told CNN that he'd vote against the legislation were it to hit the floor of Congress tomorrow.

Meadows says he is concerned about the refundable tax credits the bill would offer to help Americans pay for insurance on the individual market. Unlike Obamacare's tax credits, which are only available to Americans who earn less than 400 percent of the poverty line and are more generous for lower-income families, the GOP's subsidies would be available to all Americans who lack employer-based coverage and would rise with age. Those under 30 would be eligible for $2,000 of assistance while those 60 and older would be eligible for $4,000. Meadows considers this system a nonstarter; ditto the taxes needed to pay for it.

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"What is conservative about a new entitlement program and a new tax increase? And should that be the first thing that the president signs of significance, that we sent to the new president?" Meadows told CNN. "A new Republican president signs a new entitlement and a new tax increase as his first major piece of legislation? I don't know how you support that—do you?"

Interestingly, Meadows echoes some progressive complaints about the GOP's draft bill—namely, that it would benefit rich, older Americans more than the needy.

"So the headline is that the GOP is reducing subsidies to needy individuals when in fact, the growth of the taxpayer-subsidized reimbursements will actually increase. The total dollars that we spend on subsidies will be far greater," he said. "So you can be a millionaire and not have employer-based health care and you're going to get a check from the federal government—I've got a problem with that."

Meadows isn't the only Freedom Caucus member to express skepticism about the bill that's now circulating—Ohio Rep. Jim Jordan also has qualms, according to CNN, while Florida's Ted Yoho previously objected to some of its features. A primary concern seems to be that the tax credits are refundable, meaning that if they're worth more than an American owes in taxes, that person gets the difference back in cash (or, in this specific case, in payments toward their health insurance premiums). In the eyes of the Freedom Caucus, that makes them an entitlement rather than a tax break—and they're not really wrong. Refundability is really just a not-so-subtle way to hide government benefits in the tax code. The fact that far-right conservatives are wising up to that bodes poorly for the legislation's chances, given the Freedom Caucus' sway in the House.

All of this once again raises the question of whether any health reform proposal could placate enough Republicans to pass Congress. A plan lacking refundable tax credits would be of minimal help to lower-income families, who would be especially in danger of losing their insurance once Obamacare's Medicaid expansion was rolled back. With relatively moderate Republicans in the Senate (emphasis on relatively) already squeamish about the possibility of throwing millions of Americans from their coverage, it's hard to see how such a bare-bones plan like what the Freedom Caucus has in mind could get traction there—much less attract the Democratic votes necessary to overcome a filibuster and fully replace the ACA.

The Republican plan is still in its early stages, so perhaps there's still quietly room for some kind of compromise. And in the end, Senate Majority Leader Mitch McConnell and House Speaker Paul Ryan are reportedly betting that hardliners and moderates alike won't risk their necks by blocking a repeal-and-replace bill that the majority of their GOP colleagues support. But it seems equally plausible at this point that we'll discover that Republican health-care reform is just the oxymoron that so many suspect.

Feb. 27 2017 3:25 PM

Trump Says “Nobody Knew Health Care Could Be So Complicated”

Here is a thing that Donald Trump said about health care reform during a press conference Monday.

“I have to tell you, it's an unbelievably complex subject,” he told the reporters. “Nobody knew that health care could be so complicated.”

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Nobody? Nobody! Of course, everybody knows that health care reform is complicated. This is something that almost every single politician in Washington understands. Republicans know it. Democrats especially know it, having tried to enact a byzantine private-public kludge known as Obamacare that, given the political constraints of 2010, may have been the only possible compromise with a hope of passing. You could can together a whole sizzle reel of Obama saying this stuff is hard, like this one, from Politico.

But this is how new information is refracted through the prism of our president's ego. Trump evidently did not know how complicated health care policy was. Therefore, nobody must have known.

But as easy as it is to crack jokes, I take this as a good thing for conservatives looking to repeal and replace the Affordable Care Act. Trump's lack of engagement and guidance on this issue has been one of the chief complaints from Capitol Hill Republicans, who are struggling to unite behind a single plan. The fact that Trump now understands that health care policy is complicated means he is now paying attention, at least minimally, and may offer the GOP some semblance of direction. He even told a group of insurance executives Monday that a new plan was imminent. This time he may not even be imagining it.

Plus, during the press conference Trump said that Congress can't get to tax reform until health care is done. Given how badly Trump would like to cut taxes for Mar-a-Lago Club members, we can only assume he's finally motivated to get this repeal-and-replace thing squared away.

Feb. 27 2017 11:52 AM

Trump’s Advisers Have an Idea That Would End Trade Deals as We Know Them

As with most subjects, Donald Trump's thoughts about trade tend to get the most attention when they're expressed belligerently via Twitter. But some of the White House's most consequential ideas on the issue have largely stayed out of the headlines, including one that would fundamentally change the structure and meaning of every free trade deal in the future.

The news appeared a few days ago in Politico's morning trade newsletter, which reported that White House trade guru Peter Navarro told Senate Finance Committee members “that the administration also wants to include a provision that would trigger a renegotiation whenever the United States runs a trade deficit with the partner country.” That's on top of a previous statement that Trump wants to be able to withdraw from future trade deals with just 30 days notice.

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Combined, these two ideas would fundamentally change the nature of trade agreements from semipermanent to entirely provisional. Trade balances fluctuate, often for reasons that have nothing to do with trade deals themselves. Our deficit with Mexico will probably rise a bit the next time oil prices jump up, since we import petroleum from them. That's not an indictment of NAFTA, yet it could still be used as a pretext to renegotiate the pact under the regime Trump's people seem to be imagining. The details of our trade pacts would all be written in pencil.

Tacking a self-destruct mechanism onto every U.S. trade agreement would make those deals far less effective at their ostensible goal of promoting commerce across borders. Businesses crave certainty in general, but especially when it comes to trade, because building a global supply chain doesn't make any sense if it might suddenly be gummed up by tariffs at any given moment. One of the most powerful demonstrations of that dynamic is China. In 2000, the Clinton administration granted the People's Republic permanent normal trade relations, which ended an annual, largely symbolic ritual in which Congress voted on whether to continue giving China the same trade rights as other nations. Even though the change didn't actually eliminate any trade barriers, academics have argued convincingly that it caused China's exports to boom by simply giving companies assurance that tariffs wouldn't come back. The Trump administration's idea would have the opposite effect; every time a business debated whether to find a supplier abroad, it would have to weigh the possibility that the rules of the road would change the next time America's trade deficit figures came in wrong.

But perhaps that’s part of the logic—to write free trade deals in name only that will still discourage factories from moving abroad.

Trump's trigger would also make the idea of striking a trade agreement with the U.S. less appealing for our potential partners. The Trump administration has already said that its goal with every trade deal will be to improve the country's overall trade gap, which would mean cutting other countries' surpluses or putting them at a deficit. Economically, that might not be the worst thing (some countries probably should have smaller trade surpluses). But politically, it makes the optics of choosing to negotiate with the United States pretty awful, at least if you're a country like Japan that doesn't already have a deal Trump can threaten to pull out of. By demanding that every free trade deal be renegotiated every time the U.S. runs a bilateral deficit, Trump will make his terms sound all the more worse before negotiators even walk into the room.

There's also a little bit of unintended irony here. The renegotiation trigger sounds like it's meant to guarantee that the U.S. works its way toward the best possible agreement for our domestic industries. But if every trade pact can be dissolved hassle-free by both sides in 30 days, as Trump appears to desire, there's nothing stopping our trade partners from walking away if they feel victimized. If Trump does ever manage to strike a terrific trade deal, it won't be built to last.

Feb. 24 2017 7:22 PM

The GOP’s Leaked Obamacare Replacement Is Terrible for the Needy

On Friday, a draft of the House Republicans' Obamacare replacement plan—which may or may not have broad support in the caucus—leaked to the press and it bodes horribly for America's needy. This is not a surprise, as the document sprung from the cold, granite hearts of the congressional GOP—members of which literally think that leaving more Americans uninsured would be a victory for liberty. But it's worth noting nonetheless.

To begin, the plan would roll back the Affordable Care Act's Medicaid expansion starting in 2020 and slap spending caps on the program. This is a noteworthy problem for low-income families, as Medicaid is a program specifically designed to provide them with insurance. Second, the plan would replace Obamacare's premium subsidies, which are more generous for poorer families, with a new system of subsidies (or refundable tax credits, whatever you want to call them) that will rise with a person's age. Though I'm sure these numbers are nowhere near final, they'd be worth the following:

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  • Under 30: $2,000
  • 30 to 40: $2,500
  • 40 to 50: $3,000
  • 50 to 60: $3,500
  • Over 60: $4,000

The bright side of this approach is that the subsidies would be available to everybody, whereas Obamacare's are only available to families earning less than 400 percent of the poverty line. The downside is that Bruce Springsteen is eligible for a bigger credit than a 27-year-old struggling to make ends meet as a home health aide. Republicans will probably argue that their plan will still make insurance affordable for lower-income Americans by eliminating Obamacare's insurance market regulations. But there are almost certainly going to be losers—a single 27-year-old making $20,000 would currently be eligible for about $2,500 in subsidies on average, according to the Kaiser Family Foundation's calculator, so they'd be looking at a 20 percent drop in assistance.

There is one major reason why you would structure premium subsidies by age instead of income. Since Obamacare's subsidies decrease with earnings, they theoretically discourage people from working or making more. A couple years ago, the Congressional Budget Office projected that this implicit tax would reduce the country's labor supply by 0.35 percent by 2025. Using an age-based scale fixes that problem.

But let's be serious. You're really going to structure a massive health insurance program to prioritize the old and wealthy over the young and poor in order to deal with a theoretical 0.35 percent decline in aggregate labor supply? That speaks to a fairly strange set of priorities.

It potentially gets worse, too. Obamacare's subsidies are designed to cap insurance premiums at a percentage of a family's income, so they grow with health care costs (they do start getting less generous if their total price exceeds a certain level of GDP). The GOP's subsidies, however, are set to increase each year by the CPI, plus 1 percent. That may well be lower than the rising cost of insurance, meaning the tax credits could become less useful over time. (Again, Republicans might argue that their formula will encourage insurers to keep premiums in check, but call me skeptical.)

Of course, one might argue that this proposed subsidy system is more a reflection of conservative philosophy than technocratic policy considerations. Which would figure. In Republican eyes, the neediest don't need the most help.

Feb. 24 2017 4:20 PM

Trump’s Latest Economics Pick: The Author of One of the Wrongest Books Ever on Investing

Kevin Hassett of the American Enterprise Institute is President Trump’s pick to lead the Council of Economic Advisers, Politico is reporting. Which makes perfect sense.

In many ways, Hassett is exactly the sort of person you would imagine filling this post in a Republican administration. He’s got a Ph.D. in economics from an Ivy League university (insert your own Penn joke, snobs); taught at another (Columbia); advised the McCain, Bush, and Romney campaigns; has a long record as a pundit (Bloomberg, National Review, Fox Business); and has published more than his fair share of wonky policy papers. (Here’s his CV, and here is his list of media hits and op-eds.)

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And in some ways, Hassett would be a welcome departure from many of Trump’s appointees. He’s not a jerk. He’s genial and pleasant. He’s a supply-sider but not angry about it. He respects norms. He’s a decent guy—who just happens to be wrong about a lot of things in the way supply-siders who work at the American Enterprise Institute typically are. Here he is in 2013, saying Obamacare would lead people not to work. Here he is in August 2014, saying the end of quantitative easing would be bad news for U.S. stock markets. I could go on.

Hassett’s celebrity rests on being the less flamboyant half of the duo that penned Dow 36,000, one of the most wrong books ever published on investing and the markets. In the book, published in 1999, Hassett and co-author James K. Glassman argued that the stock market, which had essentially tripled in the previous years, was remarkably undervalued. Investors didn’t fully comprehend the declining risk associated with stocks, they argued. As a result, they argued, the Dow could triple again, to 36,000. Not in 10 years, not in 20 years, but in three to five years. (As bad as the book read, it tasted worse when I ate a chapter of it after losing a bet in 2006.)

But that kind of prognosticator is actually what Trump needs: someone who is unafraid to make bold, highly optimistic projections of growth based on flimsy evidence and shoddy reasoning—and then to stick by them or explain them away when they fail to come true.

There are a couple ways to resolve the contradictions of Trump’s proposed and promised policies: leaving Social Security and Medicare untouched, ramping up spending on defense, deportations, and infrastructure, and cutting taxes massively while keeping the deficit in check. The first is to assume a rate of growth that is significantly higher than we’ve had in the last couple decades. Treasury Secretary Steven Mnuchin, in his highly unconvincing media forays earlier this week, argued that the U.S. could easily get back to 3 percent annual growth. President Trump himself last fall promised the U.S. could easily grow at a rate above 4 percent annually. The second, related way is to engage in dynamic scoring—to assume that changes in tax and social policy will magically produce higher growth and tax revenues, and lower deficits.

On each of the above measures, Hassett fits the bill. Here he is reaffirming his belief in Dow 36,000 after the stock market crashed in 2001. Here he is testifying in 2015 on the wonders of dynamic scoring. As for 4 percent growth, Hassett was a contributor to the 2012 book The 4% Solution: Unleashing the Economic Growth America Needs, which was published by the George W. Bush Institute. The notion that tax cuts, a changed mindset, and regulatory reform could push growth to 4 percent annually was always a bit fanciful—especially at a time when the baby boomers were beginning to enter their retirement years. And it was especially fanciful coming from an institution and authors associated with George W. Bush. His presidency’s record on GDP growth (1.6 percent per year) was literally the worst in the past 50 years. Four percent growth will be even harder to achieve if we start deporting all the people who do the work of building homes and harvesting crops.

But Hassett will gamely make the case, and will likely find receptive ears. He has a long history of playing well with others. In 2013, when Jason Furman was named to head Obama’s CEA, Hassett co-signed a letter with a bunch of other Bush administration veterans supporting the move. While the signers didn’t agree with policies, they said, “We are confident, however, that Jason Furman, if confirmed as CEA chair, will provide President Obama with advice that presents both the advantages and disadvantages of the policy proposals under consideration.”

We should hope that Kevin Hassett will be an honest broker and present arguments for and against policy proposals that promise rosy results. But given President Trump’s inability to tolerate dissent and lack of knowledge about economic policy, I’m skeptical the ever-rosy Hassett will do so.

Then again, Hassett’s famous optimism might actually be par for the course: In both Democratic and Republican administrations, White House official forecasts have generally erred on the side of growth. Appointing a CEA head who thinks the economy should be doing better than the reported results is one of the few conventional moves Trump has made.

Feb. 23 2017 1:56 PM

John Boehner Is Pretty Sure Republicans Won’t Repeal and Replace Obamacare

Former Speaker of the House John Boehner has become an occassional—and delightful—fount of Capitol Hill real talk ever since he was forced into early retirement by ticked-off conservatives in his party. And at the moment, he thinks it's pretty unlikely Republicans will succeed in their goal of repealing and replacing their great white whale, Obamacare.

According to Politico, Boehner told an Orlando, Florida, health care conference that while his erstwhile GOP colleagues were "going to fix Obamacare—I shouldn’t call it repeal-and-replace, because it’s not going to happen.”

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Boehner added, for good measure: “Most of the framework of the Affordable Care Act … that’s going to be there.”

So, a man who knows a thing or two about GOP dysfunction thinks President Obama's namesake legislative achievement will survive in some form, with small changes. Boehner also said he “started laughing” when Republicans started talking about rapidly replacing the law after Trump won the election because “Republicans never ever agree on health care.” At which point, I can only assume he experienced an acid flashback to his days trying to resolve the debt ceiling standoff, then smiled ever so slightly at the thought of his lawn.

Feb. 23 2017 12:27 PM

Steve Mnuchin Is Happy to Give Trump Credit for the Booming Stock Market. We’ll See How Long That Lasts.

“This is a mark-to-market business, and you see what the market thinks.” That was Treasury Secretary Steve Mnuchin telling CNBC on Thursday morning that, yes, of course President Trump deserves credit for the 10 percent stock market rally since Election Day. Every day, Mnuchin argued, the stock market functions as a report card, a sort of running poll on the success or failure of the administration.

In this schema, traders and investors wake up every morning, look at the resident of the White House and the policy pronouncements emanating from the administration, and decide whether they think stock returns will be positive or negative in the future. They are participating in a sort of online daily tracking pool, but with real money at stake.

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You hear this kind of argument a lot from financiers and financial pundits—but only when two things are happening: a Republican is in the White House, and the stock market is going up.

This is an old intellectual tic of Republican market types. If the stock market rises when a Democrat is president, he’ll get no credit. During Bill Clinton’s presidency, for example, the S&P 500 quadrupled. But right-wingers, who predicted the economy would plunge into recession when Clinton raised taxes on the wealthy in 1993, didn’t regard the 1990s bull market as a report card on the Clinton administration. Instead they ascribed the longest peacetime expansion in history to other factors: like the brilliance of Federal Reserve Chairman Alan Greenspan, the dot-com boom, NAFTA, the end of the Cold War, or the Republican takeover of Congress in 1994.

When George W. Bush came into office and promulgated tax cuts, easy money, and loose regulation of Wall Street, the switch was flicked. Supply-siders and Republicans were quick to ascribe any gains in the economy and the market directly to the president. It was the Bush Boom, as Jerry Bowyer argued in a 2003 book. Or “The Greatest Story Never Told,” as Larry Kudlow put it in National Review in 2006. But the boom was followed by a crash. In the eight years of George W. Bush’s presidency, the S&P 500 returned less than nothing.

Was this a judgment on the efficacy of Bush’s tenure? Of course not. The Wall Street Journal op-ed page and Republicans absolved Bush of all blame—how absurd to think a president has anything to do with the markets! They blamed the Federal Reserve, the Community Reinvestment Act, Barney Frank, subprime lenders.

You know what’s coming next. President Obama inherited an economy and stock market in free fall. Under his tenure, the market bottomed and then enjoyed an extraordinary resurgence. Between March 2009 and Nov. 8, 2016, the S&P 500 nearly tripled. The stimulus package, the bailouts, the Affordable Care Act, the appointment of Janet Yellen. Republicans assured us that every one of these steps would mean disaster for the markets and the economy. By and large, however, these moves worked. And the policies of aggressively guaranteeing every financial asset in existence proved to be a particular boon to banks. In fact, the Obama-era bull market and reflation enabled Steve Mnuchin to mint his fortune on One West.

Of course, throughout the Obama years, Republicans and right-leaning market analysts steadfastly refused to mark the Obama presidency to the market, or vice-versa. The stock market was rising because interest rates were low, because it was all a giant bubble, because companies were brilliant at finding new ways to profit, because of Silicon Valley innovation. How absurd to think that the stock market is some kind of report card on the president!

And here we are again. Never mind the immense gains in the stock market over the last eight years, or the eight years of economic expansion, or the record string of monthly job gains. Now that there’s a Republican in the White House again, Mnuchin’s simple-minded analysis goes, we’re really going to have prosperity. And it will all be due to the brilliance of the 45th president.

Marking your reputation—or company value or success or presidency—to the market is a really good idea when markets are booming. Those in charge are eager to claim credit for the valuations they get at the top. But the minute the market plummets, marking to market doesn’t sound like such a good idea. In fact, during the financial crisis, right-wingers suggested we should just suspend mark-to-market accounting to spare Wall Street banks from the carnage.

The minute the markets turn south, I would fully expect Steven Mnuchin to suggest that we do the same with regard to President Trump.

Feb. 21 2017 6:14 PM

Homeland Security Just Revealed the Trump Administration’s Road Map for Cracking Down on Undocumented Immigrants

On Tuesday, the Department of Homeland Security officially released two memos, first reported by McClatchy and others on Saturday, that outline the Trump administration’s strategy for deporting undocumented immigrants and other aliens with criminal records.

To a large extent, the memos detail how the department will enforce Trump’s omnibus executive order on immigration, signed on Jan. 25, that promised to defund sanctuary cities, deputize local law enforcement as immigration police, and hire thousands of new agents for Border Patrol and Immigration and Customs Enforcement. While there are only 6,000 ICE agents, there are more than 700,000 local police around the country. Together, those actions may create an effective “deportation force,” with or without the participation of the National Guard.

The memos also cement the broadened enforcement priorities that Trump outlined in his order. Under Obama, ICE had moved to limit its deportation focus to only convicted criminals, terrorist threats, and very recent arrivals. (Though many criminal aliens are guilty of nonviolent offenses like working with a false Social Security number, driving without a license, or marijuana possession.) The new DHS rules make all aliens without valid visas a priority for removal, though a DHS official told reporters on Tuesday the department would still focus its limited resources on those who have committed “serious crimes.”

Feb. 21 2017 1:41 PM

Trump Visited the Smithsonian African American History Museum. What Might He Have Learned?

President Donald Trump spent Tuesday morning touring the National Museum of African American History and Culture, a makeup visit for the trip he was supposed to have made on Martin Luther King Jr. Day. One of Trump’s companions was Ben Carson, his pick for secretary of housing and urban development, whose career as a neurosurgeon is commemorated in one of the upstairs exhibits.

It would have been a good opportunity for the developer-president to update his notion of the “inner city” as a stand-in for black America, and perhaps even examine his own role in creating that stereotype.

Fittingly, there is nothing in the museum about Donald Trump’s own brush with fair housing law. In 1973, Trump was sued by the Department of Justice for refusing to rent or negotiate rentals with black tenants in the buildings his father had built in outer-borough New York City. The 27-year-old Trump vehemently denied the accusation. The standout detail from the case, which Trump settled in 1975 without admission of guilt but with a formal structure to help black tenants find apartments in Trump buildings, was that applications from blacks were marked with a for colored. A review of some related documents released last week by the FBI reveals a blunter approach at some of the buildings in the Trump Management Co.: A black prospective tenant would be told there were no vacancies, despite a newspaper listing; a white prospective tenant would be shown an empty apartment immediately.

Tucked away on the third level of the underground history galleries at the NMAAHC is a room called “Cities and Suburbs” that to some extent tells the other side of this story: the diverse but largely segregated set of black communities that emerged after 1968. Like the rest of the museum, its focus is on black agency—on places like Soul City, the utopian black community that the Washington Post called “perhaps the most vital experiment yet in this country’s halting struggle against the cancer of hectic urbanization.” The endeavor got a $14 million grant from President Nixon’s Department of Housing and Urban Development.

Feb. 17 2017 6:59 PM

The Republican “Plan” to Replace Obamacare Includes a Huge Assault on Abortion Access

In an attempt to project some semblance of party unity and momentum, House Speaker Paul Ryan unveiled the latest Republican road map for replacing the Affordable Care Act this week. It is not the most detailed document—more a collection of broad-stroke ideas than a concrete policy plan—and it's unclear how much support it would find in Congress. But at least one thing is obvious from this outline: Republicans are looking to turn Obamacare repeal into an assault on abortion access.

Here's how they'd go about it: To make health insurance (somewhat) affordable, Ryan's plan would offer tax credits to all Americans purchasing coverage on the individual market. However, women would not be allowed to use those subsidies to buy plans that paid for abortion. Given that the vast majority of customers would want to use their tax credits, most carriers would likely drop abortion coverage from their offerings.

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“It seems pretty clear that this would drastically scale back or possibly eliminate abortion coverage in the individual market,” Adam Sonfield, a senior policy manager at the Guttmacher Institute, told me. He added that the rule could also have “spillover effects” on employer-based insurance, because of the way the Republican idea could affect COBRA coverage.

Reproductive health advocates faced down a similar threat when Congress was crafting Obamacare in 2010. Back then, the House of Representatives passed the notorious Stupak amendment, which would have banned Americans from using the ACA's tax credits to buy coverage that included abortion benefits. The worry then was that if insurers couldn't sell subsidized plans that covered abortion, they wouldn't bother selling any. One analysis from the George Washington University School of Public Health suggested that would spark an industrywide change in standards that would end coverage of medically necessary abortions “for all women, not only those whose coverage is derived through a health insurance exchange.” Before Obamacare became law, however, the Stupak amendment was subbed out for a watered-down replacement proposed by Florida Sen. Bill Nelson.

The map of abortion coverage under the ACA is complicated. Thanks to the Hyde amendment, which prevents federal money from being used to fund abortions, Medicaid can't cover abortion anywhere. Meanwhile, 25 states currently restrict or ban insurance plans sold on Obamacare's insurance exchanges from covering abortion, according to Guttmacher. Ten states limit it on all private insurance plans. But in others there are no restrictions on abortion benefits in the private market at all.

The new Republican plan is a bit like the Stupak amendment on steroids. After all, Obamacare's subsidies are only eligible to those with incomes up to 400 percent of the poverty line. The Republican tax credit would be available to anybody in the individual market, meaning insurers would likely expect pretty much everyone to use one, and tailor their offerings accordingly. (For those wondering: No, Ryan has not said how much the credits would be worth, and since they'd be universal, they'd also likely be pretty small.) You would expect abortion coverage to disappear from the whole individual market rapidly. Like the GW team argued years ago, it's possible that the change in industry norms would lead insurers to drop the benefits from the plans they sell to employers. Some might suggest that women could purchase special riders to cover abortion, but those sorts of add-ons haven't worked particularly well in health insurance, since they tend to be extremely expensive.

It's hard to quantify how deeply the GOP plan would damage abortion access. “Even when women do have private insurance coverage, most of them end up paying out of pocket [for abortions]. What is not clear is why,” Sonfield told me. However, driving abortion coverage out of the individual market would certainly make the procedure less affordable for many, while further stigmatizing a procedure that should be considered a standard part of reproductive care.

Of course, that might be the only part of health reform every Republican will be able to get behind.

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