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End the Obamacare Slush Fund

As Dean Clancy wrote last week at FreedomWorks, the House today will take up the Helping Sick Americans Now Act (H.R.1549). The bill cuts a slush fund and uses the money to subsidize insurance for the sickest Americans. Congress should pass it.

Contrary to various claims, this bill neither cripples Obamacare implementation nor fixes Obamacare. It merely forces the Obamacare train wreck to get by on its own, without spending taxpayer (or deficit) money to push administration policies.

The bill’s purpose is to move funding from one area of Obamacare to another, from a slush fund called the “Prevention and Public Health Fund” to the “Preexisting Condition Insurance Program” (PCIP). That may sound iffy — why aren’t conservatives pushing for full repeal?

Obamacare will not likely be repealed with the current President, especially given the attitude of current Republican leadership.

Like repeal efforts generally, cutting the slush fund, must be attached to something Obamacare proponents either cannot or will not oppose. Of all the provisions of Obamacare, the one opponents and fans alike are least likely to oppose is PCIP.

The PCIP was intended as a stopgap solution for people who could not get health insurance because they were too sick to be a good insurance risk.  It is a federal version of something conservatives have been advocating for a long time, high risk pools.

HRPs allow people who are bad insurance risks to get insurance. It’s a better use of public money than the usual entitlment-state alternatives. The PCIP is not a particularly good version of an HRP, since it’s run at the federal, not the state level. Fortunately, it is slated to end at the start of 2014, as the insurance exchanges come online, although the exchanges may not actually be ready by then.

An amendment to the HSAN is expected to receive a vote also. If amended, the Act would:

  1. Eliminate the entire slush fund, not just for fiscal years 2013-2016 as the original bill does.
  2. Authorize (subject to appropriation) beginning in January 2014 the creation of state-based high risk pools.
  3. Reduce the deficit by $8 billion (instead of $840 million) over ten years, according to the Congressional Budget Office.

Despite pushing for Obamacare to help those with preexisting conditions and saying no one would lose their coverage, President Obama cut off funds for new enrollees in the PCIP, though DHHS Director Kathleen Sebelius has the authority to restore them.  Congress should force her hand.

The PCIP serves only a small number of very sick people who would otherwise have to join the Welfare and Medicaid entitlement rolls to get the specialized care they need.

Were it not for the tsunami of distortions caused by health insurance tax incentives, Medicare, Medicaid, and now Obamacare, the people with these preexisting conditions would not face the kind of health care and health insurance costs they do. But because we have these other giant programs distorting the market, continuing the funding for a HRP is hardly a concession that government can do health insurance better.

The slush fund will be used for ad campaigns similar to the Andy Griffith Obamacare ads from the 2010 election cycle, and other annoying activities with questionable legal footing.

As Ken Hoagland said of the Helping Sick Americans Now Act:

Our grassroots supporters like it. They understand there are problems with our healthcare system but that ObamaCare is the wrong medicine. Pre-existing conditions are a problem and recognizing this plain truth is positive. Better? The difference between caring for people who are out in the cold and using the monies to accelerate the set up of what will be seriously delayed and dysfunctional exchanges, funding Hatch Act violations and bike paths.

People understand the Chicago-style corruptions of these slush funds, according to Hoagland, and want to be pro-active instead of repeating in ever-more clever ways that Obamacare is wrong.

“And stopping $300 million in new happy-talk ObamaCare TV ads is also a good thing,” added Hoagland. “Of course it’s less than perfect but it’s a lot better than seeing the slush fund advance ObamaCare while we argue the perfect.”

While the media spinners may try to paint this as conservatives supporting Obamacare, that isn’t the case. The bill makes it more difficult for the Obama administration to propagandize the people with their own money, while aiding people whose health care costs, brought on by government distortion of the marketplace, would otherwise destroy them.

Follow @lheal on Twitter.

Adapted from post at and portions © Copyright 2013, Freedomworks

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