Congress 'Tip Toes' Around Obamacare

Of the many issues involved with the actual implementation of the 2010 Affordable Care Act, aka, “Obamacare”, few are more intriguing to me than those that personally impact Members of Congress (MOCs).  Here’s a good example of what I’m talking about - Today, on Capitol Hill, MOCs, along with thousands of their personal Congressional staff members, are facing a clear legal mandate that requires them to sign up for Obamacare.

However, according to a recent article in Politico these same Members and their staffs are currently scurrying about Capitol Hill, looking for ways to deftly tip toe around this mandate set to begin January 1, 2014.

How has this happened?  Well, as noted by Politico, in the heat of the 2009/2010 Obamacare debate, Sen. Charles Grassley (R-IA) stated, “It’s necessary and only fair for Congress to live under the rules we pass for everyone else.”  That is, Grassley’s position was that if Congress were to lay this new, revolutionary healthcare law on the American people, then by gosh, those serving in Congress would also have to obtain their healthcare via the same system. And that is exactly what was written into the law.  At the time, many Congressmen, for example, Sen. Sherrod Brown (D-OH), cheered this concept.

But as the reality of the new law has set in, it’s apparent that not every Member of Congress continues to cheer Grassley’s call for medical egalitarianism.  In fact, it seems this issue has caused a bit of internecine warfare on the Hill, pitting those who will be forced to obtain medical service from Obamacare, against those who will not.

In the middle of this squabble is the US Office of Personnel Management that has drawn the unenviable job of ruling on who on the Hill is in, and who’s out. A decision is expected sometime in May.  Currently, the OPM office is in “listening mode” on the issue and Politico reports that many Congressional staffs are in “discussions” with the OPM.

However, as pointed out earlier, the cold, hard truth here is that there really is no wiggle room on the basic issue of coverage.  According to Section 1312(d)(3)(D) of the ACA Act all Members of Congress and their immediate staffs shall utilize Obamacare after January 1, 2014. This care will be obtained either through their home state exchanges, or through the state exchanges of Maryland, Virginia, or DC, depending on where they live in Metro D.C. Seems straight forward enough.

So, what’s causing the uproar on the Hill?  Simple. The 535 MOCs and their thousands of personal Hill staff who, per the law, will be forced to accept Obamacare in about 8 months, will shortly be working side-by-side with thousands of other Capitol Hill staffers who will not have to use Obamacare. Think about that dynamic for a moment.

And who are these “other” Hill people who are exempted from Obamacare?  You may be surprised.

According to Politico, professional staff persons, either working for a standing Congressional committee (such as Appropriations, Ways and Means, etc.) – or working for one of the fourLeadership staffs - do not have to sign up for Obamacare.

Additionally, the Capitol Hill administrative staffs (custodians, security, food services, etc.), as well as the entire Executive Branch and its Agencies, also are exempted.

Given that, here’s an intriguing question: does this mean that the federal CMS staffers currently working so hard on the 2014 implementation of Obamacare, are fully exempt from Obamacare? Looks like it. This also suggests that HHS Secretary Kathleen Sebelius, Obamacare’s primary advocate on the Hill, won’t have to sign up for Obamacare, either.

And where is the President on signing up for his signature domestic achievement?  Well, in comparison to his position three years ago when he said “I will sign up!” things have changed.  He is now quoted as saying he “may obtain his healthcare through the program.”

But realistically, as the Head of the Executive Branch, why would he do this?  He is exempt from the law he championed.

In other words, it boils down to this: if you are an elected Member of Congress, or work as part of the personal political staff of such a person, you get Obamacare.  However, if you are basically any other federal worker, you are apparently exempted from the provisions of Obamacare.

And how will all these exempt federal employees and appointees get their healthcare?  They’ll get it through Federal Employee Health Benefits (FEHB), a federal health insurance program that has been in place since 1960. This offering is made up of 250 different private, managed healthcare plans. Members and staff receive 72 to 75 percent coverage of their health costs from the Federal government, with most FEHB beneficiaries paying about 30% out of pocket.  Universally, the FEHB is seen as a very robust healthcare offering, rivaling many of those offered in the private sector. On the Hill, this insurance is viewed as one of the best benefits provided to those folks who work for the federal government, not to mention those elected to Congress.

And that is exactly the cause of the fury on the Hill – Members of Congress and their Hill staffs both in DC and back home must give up their FEHB coverage after January 1, 2014.  And many don’t like that idea.

What’s interesting to contemplate is how this will actually shake out for the 535 Members of Congress and their staffs when they leave FEHB and sign up for Obamacare in the state exchanges.

Let’s take an MOC from California. That state has been way out in front on adopting Obamacare state exchanges. So, theoretically, the California MOC’s in-state staff, living in say, Los Angeles, would be able to get the new Obamacare benefit without too much difficulty.  It’s possible, however, in fact very likely, that the new CA state exchange insurance would not be as robust as the FEHB insurance.  Still, the CA congressional staffers should be able to access the new Obamacare healthcare insurance.

However, for a home state Congressional staffer from one of the 25 states that has decided to just say “no” to Obamacare – Texas, for example – that might not be the case. In fact, for those states, it’s possible the only option for Congressional staff healthcare would be a federally sponsored exchange implemented by HHS.  Controlled and administered by Washington, this offering would likely be a step down from FEHB.

Another big sticking point for the MOCs and staff who are being forced into Obamacare is that while the federal employee reimbursement levels provided under FEHB is about 70%, there is no provision in the new law that states that the new state exchange policies must provide a comparable reimbursement levels (page 2).  In fact, “no reimbursed coverage” is a possibility.  So this diminished level of reimbursement or a complete lack of coverage is something that could turn into a significant personal expense for MOCs and their staffs when they forfeit their FEHB care, no matter what state they are from.

The final point in all of this, and really, this may be the biggest issue of all, is how will Obamacare affect federal retirement benefits?  Prior to the advent of Obamacare, a person with 20 years of service to the federal government, including Members of Congress and their staffs, was entitled to full FEHB “annuitant” health insurance for the rest of their lives.  But FEHB retirement annuities are not part of the state exchanges.  So how will MOCs and staffs get healthcare after 20 years of federal service?  Through their home state exchanges?  Much is unclear on this important question.

On reflection, I think I understand the “fury” on the Hill.  People who have worked together as colleagues addressing the same Capitol Hill problems for years and years, and who have depended on the same health benefits and retirement programs, all of a sudden are being placed on two very different health benefit planes: those who are being forced into the Obamacare state exchanges (if they exist in their states); and those who will continue to cruise along with the very robust FEHB.

And how will Congress likely manage this dichotomy?  Well, I expect Congress will do what Congress does best. Legislate. I look for some very quiet, “corrective” amendments to be quickly offered on Obamacare in 2014, or at the latest 2015.

Although I suspect a lot of Congressional tip toeing to occur around this ‘troublesome’ Obamacare mandate, in the end, we are likely to see aberrations like state exchange programs that specifically provide FEHB-like service to Members and their staffs.  And, at the same time, I wouldn’t be looking for Congress to pass similar benefit upgrades for “everyone else,” as Sen. Grassley put it, for their Obamacare state exchange programs.

Those are my thoughts on the oncoming shift of healthcare services on Capitol Hill.  I would like to hear your thoughts on this situation.

Tom Norton is principal at NHD Smart Communications. He can be reached attnorton@nhdcomm.com