Topics: Obamacare

Would a GOP takeover of the Senate kill the employer mandate?

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Beltway Confidential,Opinion,Philip Klein,Barack Obama,Obamacare,Health Care,2014 Elections,Campaigns,Employer Mandate

Over at Talking Points Memo, Dylan Scott has a reported piece speculating that if Republicans take over the U.S. Senate this fall, they could pass a repeal of the employer mandate -- and President Obama just might sign it.

Scott's piece raise some good points as to why this would be plausible, but there are several reasons I'm not so sure.

To start, it isn't clear that Republicans would want to pass an isolated repeal of the employer mandate. Ever since Obama acted unilaterally to delay the employer mandate, Republicans have adopted the populist argument that if businesses are given a break from the requirement, then the same leeway must be extended to individuals. So, while it certainly wouldn't be a shock for a political party to prove inconsistent, this messaging issue is at least a complicating factor.

There is also another conservative theory that repealing individual provisions of Obamacare can undermine the coalition behind the broader repeal-and-replace effort. In this case, giving employers a break would mean that a lot of businesses currently fighting the law may head to the sidelines.

Even if the GOP did pass the bill, however, I'm not sure that Obama would sign it. He's shown that he's more willing to make tweaks to the law through executive action than to formally repeal parts of it. Eliminating the employer mandate entirely would be different from delaying it as he sees fit. He also might not want to give a newly-elected Republican Senate majority that kind of a scalp.

Finally, there's the cost issue. Scott points out that scrapping the mandate would reduce revenue by $149 billion over the next decade, but on the spending side, the Congressional Budget Office estimated that a one-year delay would only cost $3 billion.

By way of background, the reason why repealing the employer mandate while keeping the rest of the law intact would increase spending is that if they don't have to worry about penalties, employers will be more likely to dump their workers on the public exchanges, thus driving up the cost of federal subsidies.

The CBO's estimate of a one-year delay doesn't tell us much, because employers are still operating under the assumption that in the near future, they will be subject to penalties if they don't offer qualifying insurance. If the employer mandate were eliminated entirely, this consideration would disappear, and more businesses would stop offering coverage. How big of an impact this would have on the CBO score is hard to predict.

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