Government Shutdown Wouldn't Stop Affordable Care Act

Republicans pulling on the budget thread can't neatly unravel President Barack Obama's health care law.

A partial government shutdown next week would leave the major parts of the law in place and rolling along, according to former Democratic and Republican budget officials, as well as the Obama administration itself. Health care markets for the uninsured would open as scheduled on Tuesday.

Deleting the money to implement the law, the GOP's dream scenario, would indeed cripple Obamacare. But that's much less likely to happen than a government shutdown. Obama wouldn't allow the ruin of his hard-fought namesake legislation.

Part of the reason a shutdown wouldn't stop the health care law is that government doesn't grind to a halt. National defense, law enforcement, air traffic control and other activities involving the safety of human life and the protection of property continue.

Ditto for big entitlement programs such as Social Security, Medicare and Medicaid, whose "mandatory" funding does not have to be renewed annually by Congress. The Affordable Care Act is the newest addition to that club of budget heavyweights.

The employees who administer such programs may also be considered essential. During the Clinton-era shutdowns, Social Security brought back nearly 50,000 employees to handle claims work after initially giving them furloughs.

"Many of the core parts of the health care law are funded through mandatory appropriations and wouldn't be affected," Gary Cohen, the Health and Human Services Department official overseeing the health care rollout, told reporters this week.

Translation: Obamacare's good to go.

That's pretty much how a former top GOP congressional budget expert sees it too. "A government shutdown, absent any legislation, does not fundamentally alter the Affordable Care Act," said Bill Hoagland, now a senior vice president at the Bipartisan Policy Center, an advocacy group that's trying to bridge the political divide in Washington.

Economist Douglas Holtz-Eakin, chief economic adviser to 2008 Republican presidential nominee John McCain, concurs. "As a policy matter, it won't succeed in stopping Obamacare," he said of a government shutdown. "We have put much of the government on cruise control."

The main benefits of the health care law — tax credits and expanded Medicaid — are mandatory spending and cannot be unwound through an annual funding bill for government operations. As for implementation money, much of it was provided under the law itself. Core functions such as operating call centers and building online systems are being handled by private contractors, not government employees. When money has run short, the administration has been able to divert unspent funds in other accounts.

In a report for Sen. Tom Coburn, R-Okla., the Congressional Research Service concluded it's likely the administration would continue to rely on alternative sources of implementation funding in the event of a shutdown.

So why are some Republicans prepared to go through with it? They're betting that the public will blame Obama for being stubborn, although polls don't bear that out. GOP party elders in the Senate are calling it a foolhardy strategy.

Defunding the 3-year-old health care law and thus preventing its full implementation, as the House has voted to do, would be a different story.

"If you take away the money, the rest of the law isn't going to work," said Paul Van de Water, a former top official of the Congressional Budget Office, currently with the Center on Budget and Policy Priorities, which advocates for the poor. Without subsidies to help the uninsured, the law's requirement that virtually all Americans get coverage would be unreasonable.

But over the past three years, the many and varied requirements of the Affordable Care Act have become part of the way the government does business. Reversing course is not impossible, but it could be excruciating.

It would be messy because a host of mandates, taxes and regulations would remain on the books, and Medicare payment systems could get jumbled up.

Would insurers still be required to cover people with health problems? What about taxes that are already being collected and Medicare cuts that have gone through? Most employers still would have to cover dependent children of their workers up to age 26 and provide birth control free of charge as preventive care.

"It is chaotic," said Van de Water. "Legally, how that mess gets resolved, I wouldn't hazard a guess."