BATNA and an acceptable status quo

The Hill reports that Senator Johnson (R-WI) thinks that the House Republicans are the major blocking force on funding CSR:

Other Republicans say Alexander doesn’t appear to have a grasp on the politics of the House, where anything seen as shoring up ObamaCare is likely to draw fire from conservatives.

Asked if Alexander was out of step with House Republicans, Sen. Ron Johnson (R-Wis.) said, “Just based on the communication coming out of the House since yesterday, I would say that’s an accurate assessment..”.”

The Best Alternative To a Negotiated Agreement (BATNA) is a good exercise to figure out where hard lines are. People will not agree to deals that make them worse off than doing nothing.

From the right, a CSR funding bill creates major problems during Republican primaries. The major political prize from the Republican point of view is the following two headlines next October:

” Obamacare premiums drop in SWING STATE X by 12% this year”

” Obamacare premiums due to Governor Z’s waiver are dropping another 8%”

The baseline premium drop would be the removal of Silver Loading that added 19% to Silver premiums this year. That drop is not the full 19% because of medical inflation but premiums are overpriced this year. States would be able to decrease off-exchange premiums as well by filing rapid “me-too” reinsurance waivers. Oregon just got approved for a reinsurance waiver that will lead to a 7.5% drop in premiums.

If there is no Murray-Alexander agreement to fund CSR, what is the alternative from the Democratic perspective?

  • A major club to beat up on Republican incumbents in swing districts
  • Silver Loading in all states
  • Expectation that good insurance on the Exchanges is now a Gold plan instead of a Silver plan
  • States with massive flexibility to innovate

The major political gains from the Democratic point of view on Alexander-Murray is wedging House Republicans between primary and general election electorates and getting at least some Senate Republicans as stakeholders.  The policy gains are more needed technical tweaks to waivers which should lead to more state-level buy-in and outreach funding for 2019.  The policy cost is funding CSR.  This precludes an opportunity to reset the actuarial value benchmark from 70% AV to a benchmark in the mid-80%s AV.

No agreement involving CSR is an acceptable outcome for Democrats.  They could agree to outreach funding, catastrophic plans, waiver modifications and employer mandate changes and still be better off with that agreement than no agreement.  Re-funding CSR is not a critical component of Democratic policy or political objectives over the long run.

The Democratic BATNA of doing nothing to CSR is an acceptable alternative.  And since one party has an acceptable outcome of no deal, they have the leverage to restrict the changes in the deal.

 

20 replies
  1. 1
    boatboy_srq says:

    Asked if Alexander was out of step with House Republicans, Sen. Ron Johnson (R-Wis.) said, “Just based on the communication coming out of the House since yesterday, I would say that’s an accurate assessment..”.”

    Assumes that particular excuse for a human being can read. Ordinarily, anything Johnson says is mere illustration that the man has no business as a county supervisor let alone Senator.

  2. 2
    Enhanced Voting Techniques says:

    I think it’s a given a House Republican’s vote is “No” what ever the bill is. They are all following Ron Paul’s play book of demanding as much pork as they can for their district, screaming at everyone for how they they allow special interests to pollute the bill with pork and then vote no.

  3. 3
    Hunter Gathers says:

    Donnie Two Scoops will just veto the damn thing anyway.
    It’ll be the classiest, most tremedous veto ever.
    People will talk about how incredible it is.
    He’ll give himself a 10 out of 10.

  4. 4
    West of the Cascades says:

    Oregonians can afford good whisky again (next year)!

  5. 5
    MomSense says:

    Republicans are garbage. David, Karoli was tweeting that the budget, passed along party lines yesterday, cuts 1 trillion from Medicare and Medicaid. Do you know anything about this? If so, I am going to be writing some angry faxes to a certain senior senator.

  6. 6
    But her emails!!! says:

    No sure why Republicans can’t support this and lie about it’s impact on Obamacare. It’s basically what they with every other topic and piece of legislation. Why not use their power for good this one time? Are they afraid of tainting the evil?

  7. 7
    gene108 says:

    We underestimate what can pass in the House, because Boehner and now Ryan only want to pass bills with only Republican votes.

    There is a bunch of stuff, like immigration reform, which will get near unanimous support from Democrats and enough Republicans to pass, if brought up for a vote.

    Murray-Alexander could probably pass, with Democratic votes and a few Republican votes. The Freedom Caucus would have a fit, but fuck ’em. They shouldn’t be running things anyway, they are no way close to a majority.

  8. 8

    To echo @gene108 the problem is whether Ryan will bring it to a vote, not whether there are enough votes. House Republicans are very much not a monolith. Ryan, however, is a hyper-conservative fuckstick.

    Also, Trump is such a coward I figure he’d sign. No guarantees either way, but the man’s lack of spine is breathtaking.

  9. 9
    randy khan says:

    I think Mr. A’s analysis is right – the Dems don’t have much incentive to give on anything here. If the House can’t pass it because Ryan is so scared of his caucus that he won’t put a bill on the floor that requires any Democratic votes, that’s going to benefit the Dems in 2018.

    That does not make me think that this will get through the House, but I am comforted by the thought that the Dems are unlikely to give ground.

  10. 10
    Brachiator says:

    The baseline premium drop would be the removal of Silver Loading that added 19% to Silver premiums this year.

    What a ball of confusion. If I read the link to the Kaiser Foundation analysis correctly, if Trump stops payments to the insurance companies, this means that the federal premium tax credit increases for some people. This increases the cost to the government, which is stupid, but tolerable.

    I am not sure what the overall impact on the ACA and consumers would be if more companies exited the Exchange.

  11. 11
    catclub says:

    @Enhanced Voting Techniques: I disagree. I think, that just as with the immigration bill that was never brought toa vote in the House, this bill would pass the House if brought up for a vote. There is a majority of GOP Congressmen who will vote against, but there would be enough others, combined with the Democrats, to pass it.

    But it will not come up for a vote, since that is the way the House now no longer works.

  12. 12
    catclub says:

    @Brachiator:

    if Trump stops payments to the insurance companies, this means that the federal premium tax credit increases for some people. This increases the cost to the government, which is stupid, but tolerable.

    I would put it as “insane, but completely expected from these assholes.”

  13. 13
    Another Scott says:

    The thing I think is most likely to happen is that the Senate will pass something, the House will pass something very different, and then there will be some leadership-hand-picked group of old white guys that will get together in secret and hammer out something that is very different from the Senate bill and try to ram it through. That’s all they know how to do.

    If the GOP majority really wants to pass something, they will do it – they have the majority. And Donnie will sign it without reading it because he desperately wants a victory and to be able to claim he killed Obamacare and made everything Great.

    I hope the Democrats always keep this playbook in the front of their minds. It’s all kabuki until it goes to conference…

    Cheers,
    Scott.

  14. 14
    Brachiator says:

    @catclub:

    I would put it as “insane, but completely expected from these assholes.”

    Agreed.

  15. 15
    eyelessgame says:

    Remind those of us overwhelmed by too many TLAs what CSR is?

  16. 16
    catclub says:

    @gene108:

    The Freedom Caucus would have a fit, but fuck ’em. They shouldn’t be running things anyway, they are no way close to a majority.

    The whole point of not bringing these bills up for a vote is to avoid telling the Freedom Caucus just that.

  17. 17
    catclub says:

    @eyelessgame: Cost Sharing Reduction ( payments).

  18. 18
    Brachiator says:

    @eyelessgame:

    Remind those of us overwhelmed by too many TLAs what CSR is?

    FYI:

    Cost Sharing Reduction payments

  19. 19
    randy khan says:

    @Another Scott:

    In the absence of reconciliation instructions (which they don’t have), the conference report is subject to filibuster. So long as the Dems stay even moderately united, the dire reconciliation scenario is unlikely.

  20. 20
    Another Scott says:

    @randy khan: Ah. Thanks.

    Cheers,
    Scott.

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