Throughout hard-fought debates about health reform, lawmakers in both parties looked for ways to save taxpayer money. Partial subsidies would have greatly reduced costs, so the total absence of this kind of analysis among the 68 prepared by CBO for the 111th Congress (and its continuing absence in reports done for the next Congress) is the best objective evidence we have that no one in Congress considered premium subsidies restricted to certain states to be either possible or desirable. If Congress intended to threaten states with withheld subsidies, nobody said so.
It shouldn’t be news that everyone thought that the subsidies would be universally available, but there are at least five crucial people who may be prepared to ignored this. Equally important are Skocpol’s comments to Kliff:
“The larger truth is that no one assumed every state would do this,” Skocpol, a professor in Harvard’s school of government, says. “It wasn’t an issue of politics then, it was one of policy: these were smaller states and there was a thought some of them wouldn’t be able to manage the process. It was taken for granted by all parties that some states would need a backup.”
As we’ve seen, the troofer response to the overwhelming evidence that nobody thought that subsidies would be withheld from any exchange is that it was universally assumed that every state would set up an exchange by the deadline. (This splits the difference between the “card says Moops!” theory and the “The Moops invaded Spain!” theory.) But while there’s evidence of excessive optimism there’s no evidence for that, and the existence of the federal backstop is powerful evidence that Congress did contemplate some states not establishing exchanges, and of course the federal backstop was not intentionally set up to fail. Skocpol is confirming what the text itself should make clear.