Premium Notices, Missed Pay Mark Next Phase of US Shutdown (1)

The financial impacts of the government shutdown are set to escalate this week, even as Senate Republicans and Democrats show no signs of breaking the stalemate over health care policies at the heart of the fight.

Without a deal, military troops would miss their first paychecks since the shutdown started, but the administration, urged on by congressional Republicans, was working on a plan to pay troops on Oct. 15 despite the impasse.

Meanwhile, Americans who use Obamacare are starting to feel the consequences of expiring subsidies at the center of Democrats’ demands, as insurance companies begin to send notices of rising premiums.

The Trump administration said the government would pay the military this week using tariff and tax revenues. But without action by Congress, it’s unclear how the administration can do so.

Members of the military during the US Army’s 250th Anniversary Parade in Washington.

Photographer: Kenny Holston/The New York Times/Bloomberg

Representative Jim Himes, a Democrat from Connecticut, highlighted the impact the shutdown will have on troops on CBS’s Face the Nation Sunday.

“None of them are wealthy. None of them are going to get paid on October 15,” Himes said. “To pay the military during a shutdown would require legislation. The speaker of the House has taken that off the table.”

Read More: Trump Layoffs, Broken Trust Harden Democrats’ Shutdown Stand

Speaker Mike Johnson has refused to bring the House back to Washington, which prevents any votes from being scheduled to ensure military members are paid for the duration of the shutdown. He is insisting the stopgap spending bill passed by his chamber is the only path forward.

On Monday, Johnson backed the administration’s plan to make an end run around Congress and pay the military this week.

“We are so very grateful that President Trump, again, showing strong leadership, has stepped up to ensure that our troops are going to be paid on October 15, while we wait for Democrats to stop holding the country hostage,” Johnson told reporters at the Capitol.

The Louisiana Republican signaled he’d continue to keep House lawmakers home as the shutdown extends into its third work week. His plan, Johnson said, has the support of all but three House Republicans.

Separately, Republicans are under increased pressure to negotiate with Democrats on extending expiring tax credits that lower health-care premiums for more than 22 million people enrolled on Obamacare exchanges. Insurance companies are sending out notices to customers this month, reflecting large increases to premiums for next year.

With open enrollment starting Nov. 1, Democrats insist a deal to reopen the government must include an extension of the subsidies. Republican leaders have said they will negotiate with Democrats on the issue after the government reopens.

Senate Majority Leader John Thune and House Speaker Mike Johnson during a news conference at the US Capitol in Washington on Oct. 10.

Photographer: Valerie Plesch/Bloomberg

But notices of rising premiums have caused the smallest of cracks in GOP unity on the issue. Representative Marjorie Taylor Greene, a conservative Georgia Republican, broke from the ranks, criticizing her party for lacking a plan to keep premiums from rising, saying her own offspring would be affected by tax credits’ sunset.

Democrats see Greene’s defection as a hopeful sign that more Republicans may be open to striking a deal to extend the subsidies as their constituents are hit with higher premiums.

The health insurance subsidies at the center of the shutdown fight disproportionately benefit areas of the country represented by Republican lawmakers.

“As every day goes on there are more Republicans that are breaking with JD Vance and President Trump” on health care, Democratic Senator Chris Murphy of Connecticut said on CBS on Sunday. “Hopefully at some point there will be enough Republicans to join us and try to protect people’s pocketbooks.”

But Johnson made some of his most critical remarks Monday on Obamacare, calling the 2010 inception of the healthcare program “sinister” and intended to lead to government control of health care.

“I believe Obamacare was created to implode upon itself, to collapse upon itself,” Johnson said. “I think the people who drafted that, the architects of it, knew that it would not be sustainable.”

President Barack Obama’s namesake program, however, has become more popular since Republicans first tried to repeal it during Trump’s first term. A September poll done by KFF, a nonpartisan health research foundation, found that the program was viewed favorably by 64% of US adults.

No Off-Ramps

But so far, informal bipartisan talks about extending the subsidies have yet to produce an off-ramp to the shutdown. Democrats have been skeptical that any deal they strike with Senate Republicans will stick in the House without Donald Trump’s blessing.

Democrats have urged the president to negotiate with them. Trump so far has ignored their requests.

Read More: DC Tourists Frustrated by Museum Closures as Shutdown Persists

“The president has indicated he wants to do something about this,” Democratic Senator Mark Kelly of Arizona said on NBC’s Meet the Press Sunday. “All this is going to take is to put everybody in a room for an extended period of time and coming up with some reasonable conclusion.”

House Republicans have done little to persuade Democrats they would honor a deal to extend the subsidies if the Senate can reach one, by stepping up attacks on President Barack Obama’s 2010 health care overhaul. Representative Steve Scalise of Louisiana, the No. 2 Republican in the House, called Obamacare a “sinkhole” and a “failed project” Friday, adding that 90% of his conference felt the same about the program that is broadly popular with Americans.

Scalise and others also criticized the expiring subsidies as a giveaway to health insurance companies. Making those subsidies, first enacted during the Covid-19 pandemic, permanent would cost $350 billion over 10 years, according to the nonpartisan Congressional Budget Office.

More Cuts Coming

Trump’s decision to fire more than 4,000 federal workers Friday further eroded the prospect of reaching a deal to end the shutdown quickly. Vice President JD Vance said on Fox News’s Sunday Morning Futures that more dismissals are coming.

“The longer this goes on, the deeper the cuts will be,” Vance said.

(Updates with new details starting in seventh paragraph)

--With assistance from Erik Wasson.

To contact the reporters on this story:
Caitlin Reilly in Washington at creilly106@bloomberg.net;
Steven T. Dennis in Washington at sdennis17@bloomberg.net;
Alicia Diaz in Washington at adiaz243@bloomberg.net

To contact the editors responsible for this story:
Megan Scully at mscully32@bloomberg.net

Wendy Benjaminson, Kevin Whitelaw

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