GOP Strategy on Obamacare: Repair or Repeal?

The Fiscal Times

Republicans are ramping up their war on Obamacare this week with several new plans to carve away at the president’s health care law.

The House Oversight Committee will hold a hearing on Wednesday targeting the law’s “risk corridors” provision, which conservatives have deemed a “bailout” for insurance companies. A few have signaled they may use the provision as leverage in a larger fight over the debt ceiling, which Treasury Secretary Jack Lew warns must be raised by the end of February.

Related: Republicans Revive War on Obamacare

Obamacare advocates and insurance executives, however, say getting rid of the provision would cause severe market instability and completely undermine the health care law---a not so subtle reason why it’s in the GOP’s crosshairs.

House Majority Leader Eric Cantor (R-VA) declared on CBS’s “Face the Nation” on Sunday that the end of the Affordable Care Act is within sight,” adding that the GOP will be unveiling a sweeping alternative to the law in the coming months.

Other proposals that have already been introduced target only certain provisions of the healthcare law. 

One of the two proposals the House Ways and Means Committee is reviewing Tuesday is the Save American Workers (SAW) Act. Under the ACA, companies with 50 or more “full-time employees” are required to offer health coverage to their workers. The SAW Act would change the law’s definition of “full-time employees” from those working 30 hours or more---to workers logging more than 40 hours a week.

The bill’s sponsor, Rep. Todd Young (R-IN) and other Obamacare critics, say the current law has prompted some companies to shift their full-time workers to part-time to avoid paying for employee health insurance.

Related: Obamacare Mess Defines GOP 2014 Campaign Strategy

"Americans are seeing their hours cut and their paychecks reduced as a result of the employer mandate, a centerpiece of the law," Young said when he introduced the bill last June. "We were promised this bill would create jobs, and evidence that the opposite is happening is apparent every day."

A poll by Public Opinion Strategies found that about 30 percent of small franchises and 12 percent of other small businesses say they have already cut work hours – or swapped full-time for part-time workers – because of the law, the Christian Science Monitor reported.

However, the ACA may not be to blame. Some economists have pointed out that the increase in part-time employment began before Obamacare, and is likely the result of the Great Recession in 2008.

"There are ups and downs after the end of the recession... and the passage of health care reform... but the general drift is clearly down. Some point to the slight increase of the past six months, but there have been similar increases and decreases before and after the passage of health care reform," Max Sawicky, a senior economist at the Economic Policy Institute, wrote in a blog post. There is nothing noteworthy about the most recent uptick."

Still, the bill has already received support from the retail industry. Christine Pollack, vice president of government affairs at Retail Industry Leaders Association, the industry’s trade group, said in a statement that the bill was a “move in the right direction….The Affordable Care Act’s 30 hour full-time definition is fundamentally reshaping labor markets and changing the way retailers plan, operate and manage.”

The second GOP bill would eliminate a glitch in the law, which requires municipalities to treat volunteer firefighters as if they were full-time employees. Under the law, volunteer fire departments with more than 50 full-time workers would be required to offer health insurance. This has caused concern for municipalities that say they aren’t prepared to absorb the additional expenses.

Related: More Companies Dump Employee Insurance for Obamacare

The administration has already announced exemption waivers to some communities. This GOP proposal, however, would make it the law of the land. The bill has support from the National Volunteer Fire Council, which released a statement saying, “Municipalities don’t have the resources to cover benefits for volunteers, and that these volunteers generally are not expecting to receive benefits anyway.”

The latest string of Obamacare hearings and ACA replacement proposals comes on the heels of the Republican’s annual retreat last Friday, where the GOP mapped out its policy strategies for the rest of the year. Instead of offering up more symbolic votes to repeal the law, Republicans will be offering up alternatives to the law in order to appease voters unhappy with Obamacare ahead of the 2014 mid-term elections.

This article was updated at 9:01 A.M.

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