Michael Grunwald is a senior staff writer for Politico Magazine.

President Donald Trump often blasts Obamacare as a total disaster, a pathetic failure doomed to implode. But sometimes he adds a twist, suggesting that instead of trying to fix the situation, Republicans would be smarter to exploit the situation. “Let it be a disaster, because we can blame that on the Democrats,” Trump mused to the National Governors Association on February 27. “Let it implode, then let it implode in 2018 even worse … Politically, it would be a great solution.”

Trump has made similar remarks on Twitter, at the Conservative Political Action Conference, in an Oval Office meeting last week with conservative activists, and at a Roosevelt Room event on Monday with Americans who don’t like Obamacare. He keeps emphasizing that Republicans are “putting themselves in a very bad position” by pushing a controversial repeal bill, when they could easily let Obamacare collapse and let Democrats take the blame. He’s been saying this kind of thing so often that it’s worth asking whether he’s taking his own advice, trying to sabotage Obamacare for political reasons.


It’s clear that Obamacare has become less stable since Trump’s election, with several insurers expressing new doubts about offering coverage on government-run exchanges. It’s also clear that this instability is central to Trump’s case for repeal, as he argues that the current state of the health care system is so catastrophic that Congress needs to pass a House Republican bill that was floundering on the Hill even before Monday’s blistering report from the Congressional Budget Office.

What’s less clear is how much Trump is intentionally contributing to Obamacare’s problems. Trump has said he’s resisting the temptation, because “we have to do what’s right,” and the White House sent me its three-pronged health care plan (including “regulatory reforms to stabilize insurance markets”) as proof. But the president has already done several things that undermine Obamacare—weakening enforcement of its insurance mandate, canceling its latest ad campaign and intensifying uncertainty about its future—although not everything he’s done has undermined it.

In any case, Obamacare is facing its most serious crisis since it launched with a dysfunctional website in 2014. Insurers will decide later this spring whether to continue offering coverage on Obamacare’s exchanges, and the combination of Trump’s election, the Republican push for repeal and the new administration’s early efforts to undercut the law has created new fears of the kind of mass exodus that GOP critics have been predicting for years. Even if the repeal bill stalls in Congress, Trump will have a lot of power to try to deepen Obamacare’s problems and enhance his argument for repeal—or to try to solve the problems and take a different type of victory lap. Trump keeps insisting that a collapse would be great news for Republicans, because it would highlight the incompetence of Democrats, while heightening the need for reforms that would reduce costs and improve care. But even setting aside the policy implications of such a massive upheaval, some experts question Trump’s political analysis.

“They must know sabotage won’t work now that they control Washington,” says Steven Ullmann, a health policy professor at the University of Miami business school. “It’s like Colin Powell said about Iraq: You break it, you own it.”

To understand what’s going on, it’s important to understand that only a small slice of what Trump calls “the very, very failed and failing Obamacare law” looks like it might break. Overall, the law has extended coverage to 20 million uninsured Americans, offered new protections for insured Americans and reined in the growth of health care costs. The vast majority of Americans are still insured through their employers, Medicare or Medicaid and most of them say they’re satisfied with their coverage. Obamacare’s high-profile problems—most notably fleeing insurers and rising premiums—are mostly problems for the 6 percent of Americans who buy insurance in the open market, especially the small fraction (equivalent to Idaho’s population) who buy it on Obamacare exchanges without Obamacare subsidies.

In the past, Trump and other Republicans consistently exaggerated those problems. Studies by independent analysts like Standard & Poor's consistently refuted claims that the exchanges were locked into a “death spiral” where premium hikes would lead healthier consumers to drop coverage and force insurers to hike premiums even more. But there’s no question death spirals are more likely now than they were before Trump came to Washington. Here’s a look at those three things Trump and his administration have done to make them more likely, along with two things they’ve done that didn’t.



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Fueling Uncertainty. The most damaging threat to Obamacare right now is the severe uncertainty about whether it will survive and in what form. This is an ironic problem, since “job-killing uncertainty” was a leading Republican argument against the original passage of the Affordable Care Act. But it’s a real problem. It’s hard for a profit-minded insurer to commit to a market that might not exist in the long run or even next year. Insurers have raked in cash in the employer-sponsored market, but while Florida Blue, Molina Healthcare and a few other plans have made money on Obamacare’s exchanges, they’re a higher-risk, lower-reward business, especially now that the president of the United States keeps promising to get rid of them.

There is no evidence for Trump’s bizarre Twitter claim that Obamacare was intentionally designed to implode after President Obama left office, but it’s true that some insurers were abandoning the exchanges even before Trump’s election. An estimated 32 percent of America’s counties had only one insurer writing policies for the exchanges this year, up from just 7 percent last year. This was partly because the market for Americans who don’t get covered at work has always been a brutal business, and partly because sabotage-minded congressional Republicans killed “risk corridor payments” that were supposed to reimburse insurers with sicker-than-expected customers. But even though premiums in several states rose sharply last year, S&P concluded that the market would stabilize in 2017, because enough young and healthy consumers would buy insurance to keep insurers on the exchanges and avoid a dreaded death spiral.

Trump has scrambled those conclusions. After a campaign in which his promises to get rid of Obamacare were some of his biggest applause lines, the mere fact of his election created new uncertainty. Humana has already announced that it’s withdrawing from the exchanges, leaving several Tennessee counties with no insurer at all. And Trump’s constant apocalyptic warnings of Obamacare’s inevitable collapse are further complicating the calculus for insurers who might otherwise be inclined to give it another shot. It’s hard to say how much of their thinking will be driven by the market, Trump’s over-the-top negativity, and the furor over the repeal bill, but in this climate, it will be tough for them to commit to the exchanges—and those that do commit might jack up their premiums to hedge their bets.

“If the insurers don’t get certainty soon, there’s going to be a dramatic exodus even if Congress does nothing,” says Kathleen Sebelius, who was President Obama’s Health and Human Services secretary during the law’s passage. “They need stability, or they’ll just leave.”

Attacking the Mandate: Trump has also taken aim at Obamacare’s key source of stability for insurers, its mandate requiring all Americans to purchase insurance or pay a tax penalty. The mandate is the least popular element of Obamacare, but it encourages younger and healthier consumers to get covered before they get sick. Since Obamacare also bans insurers from capping spending on individual customers or discriminating against customers with preexisting conditions, without the mandates, they’d be stuck covering more care for a relatively unhealthier pool of customers.

Nevertheless, Trump’s first executive order on Inauguration Day directed agencies to do take whatever actions they could to minimize the burdens of Obamacare, a broadside insiders said was aimed at the insurance mandate. Some agencies have already taken action: Last month, the IRS cited the order when it reversed an Obama administration decision to stop processing returns from taxpayers who don’t indicate whether they’re insured. Trump’s order did not by itself weaken the mandate, but it did send a chilling message to insurers as well as their potential customers that they should not expect strict enforcement of its tax penalties.

Health care experts compare efforts to soften the mandate to pulling an annoying loose thread that can end up unraveling the entire sweater. Ullmann of the University of Miami compared the move to tinkering with a house of cards.

“If you’re not careful, the whole thing will collapse,” he said.

Ending Outreach: The new administration’s most blatant effort to undermine Obamacare was its cancellation of a healthcare.gov ad campaign urging Americans to sign up for coverage before the January 31 deadline. Most of the ads were already paid for, and officials reinstated some of them after an uproar, but the shutdown clearly affected enrollment, especially among younger and healthier Americans who are much more likely to wait until the last minute. Enrollments were on track to break last year’s record at the start of January, but they ended up 500,000 shy. Nobody expected Trump to flack Obamacare as ardently as Obama, who was so desperate to sign up millennials he subjected himself to a Between Two Ferns interview, but experts believe the pulling of ads destabilized the program by limiting its growth and failing to recruit some of the most attractive customers. Sick people don’t need to be reminded to get health insurance as much as healthy people do.

“It clearly had a bad effect,” says Larry Levitt, a health policy expert at the Kaiser Family Foundation. “You need to reach out if you want to keep young people in the program and avoid big premium hikes—and they stopped reaching out.”

Helping Insurers: The Center for Medicare & Medicaid Services (CMS) had another opportunity to sow mischief in mid-February when it released its proposed rule for the 2018 exchanges. But while some consumer advocates don’t love the rule, it doesn’t look anything like sabotage. The agency’s news release quoted acting Administrator Patrick Conway—its chief medical officer during the Obama administration, and a leading figure in the implementation of Obamacare—saying the proposed rule “will take steps to stabilize the marketplace, provide more flexibility to states and insurers, and give patients access to more coverage options.”

The gist of the new rule is that it makes some adjustments that insurers had requested, giving them more flexibility to offer slightly less generous plans while tightening up loopholes they believed consumers were using to game the system. “President Trump is taking administrative steps to stabilize health insurance markets and start bringing down costs for the millions of people affected by Obamacare,” the White House said in the health care document it sent for this story. Marilyn Tavenner, who was Obama’s first CMS director and now runs America’s Health Insurance Plans, says the insurance industry saw the rule as a good-faith indication that the administration isn’t trying to destabilize the exchanges.

“A lot of what we requested is in there, so that’s good,” Tavenner said.

A rule tightening eligibility for special enrollment periods, limiting grace periods for consumers who don’t pay their premiums, lowering actuarial baselines of how much the least generous plans have to cover and fulfilling other industry requests might not sound particularly progressive. But in this climate, an effort to keep insurers happy in the exchanges reads at least in part as an effort to keep the exchanges alive. “You can argue about the merits of everything in the rule, but overall it sent a signal that the administration is on the side of stability,” Levitt said.

Maintaining Subsidies: There is still a Sword of Damocles hanging above Obamacare, though, that has nothing to do with congressional legislation or Trump’s executive powers. It’s a lawsuit that now goes by the unlikely name of House v. Price, an ongoing effort by Republicans in the House of Representatives to block HHS (now run by one of those former House Republicans, Tom Price) from spending billions of dollars on Obamacare subsidies. If the lawsuit is successful, it could effectively dismantle most of the exchanges. “It’s a huge unknown,” Tavenner said. “It’s uncertainty on top of all the uncertainty.”

For now, the House and the Trump administration have agreed to put the lawsuit on hold while they push for repeal-and-replace, so the subsidies are continuing to flow. It’s at least a temporary victory for stability, although progressives see it more as a reflection of political necessity. Topher Spiro, vice president for health policy at the left-leaning Center for American Progress, says he’s more worried about subtle regulatory changes that can undermine Obamacare over time than a high-profile legal settlement that would instantly kill it—and leave Trump’s fingerprints on the murder weapon.

“That would blow up the market in a way directly traceable to their sabotage,” Spiro says. “That’s why they’re treading lightly there.”



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Republicans are not treading lightly on Capitol Hill, where they have been clamoring for the repeal of Obamacare for seven years, and are finally preparing for a battle royale. So far, though, House Speaker Paul Ryan’s bill has come under fire from conservative Republicans who call it Obamacare Lite as well as relative moderates who don’t like its 25 percent cut to Medicaid—not to mention trade groups representing hospitals, doctors, patients and other medical interests. GOP leaders who had hoped to pass something quickly and move on to tax reform are bracing for an extended battle. And Trump has not yet signaled how deeply he’ll get involved in the negotiations, or what kind of final outcome he’d be willing to live with.

The problem for insurers is that they have to devise their plans for 2018 now, and they have no idea what the market will look like. The CBO analysis that found the GOP bill would create 24 million more uninsured Americans over the next decade also found that most of the Obamacare marketplaces would be stable without repeal. But some states are more stable than others, and that stability erodes with every day without a resolution.

Ultimately, the future of health care may depend on how deeply Trump believes what he says he keeps telling Ryan, Price and his White House team about the politics of Obamacare. “I tell them from a purely political standpoint, the single best thing we can do is nothing,” he told the conservatives at CPAC. “Let it implode completely. It’s already imploding!” But there are still 11 million Americans on Obamacare’s exchanges, which have not yet imploded, and about 9 million of them are still receiving subsidies, which have not yet disappeared. The Republican push for repeal has made Obamacare more popular than ever, and it’s a Washington truism that government benefits are much harder to take away than they are to give in the first place. Defenders of the status quo believe the public will hold Republicans responsible for whatever happens next—and despite the noisy rhetoric, they believe Trump and his aides know that.

“The Republicans own all the real estate,” says Sebelius, Obama’s former HHS secretary. “They were never willing to help fix problems when we were in charge, because they knew it was all on us. But now it’s on them. If they think they can just blame Democrats, sorry, that won’t fly.”