So does this mean that the most that could be done to repeal the ACA (without 60 votes in the senate) would be to cripple the current law, thereby creating a looming disaster?
In short, yes. I've explained why below.
As noted in the question body (though the title is partially incorrect), the main part of Obamacare (PPACA) was passed with 60 votes. Reconciliation was only used as a fixup to address some spending/revenue matters (e.g. more generous subsidies, repealing the Cornhusker Kickback, and making the mandate cheaper (i.e. less effective)).
Many of the law's most well-known provisions (no discrimination against pre-existing conditions, essential health benefits, staying on your parents' plan until age 26) are not related to government spending or revenue.
Thus, those provisions couldn't be modified using reconciliation. For example, the parliamentarian specifically ruled that essential health benefits can not be part of reconciliation.
These provisions are popular, but they also increase premiums (for example, because you can't charge sick people more, healthier people subsidize them with higher premiums). To counteract that, Obamacare:
- Imposed individual and employer mandates, so healthy people would get insurance, decreasing average health costs and thus premiums.
- Provided generous premium subsidies and cost-sharing reductions (latter attempted to subsidize deductibles and co-pays, but there was a glitch in the text of the bill).
- Funded risk corridors (subsidies to insurance companies in early years, to drive down costs and promote stability).
- Expanded Medicaid, so more lower-income people don't have to pay premiums.
Republicans fully or partially rolled back all of these in the new bill, in the past, or both:
- Zeroed out mandate penalties. They tried to replace this with a rule that you can't use insurance the first 6 months, but the parliamentarian rejected it.
- The subsidies in the Republican bill were less generous. They also sued to stop cost-sharing reductions (CSRs), and only funded CSRs in the new bill for two years (this was ironically rejected by the parliamentarian as replicating current law).
- Marco Rubio previously successfully convinced Republicans to defund risk corridors (this already went into effect in 2014). However, some courts have ruled that the government is still obligated to pay.
- National Federation of Independent Business v. Sebelius left Medicaid expansion up to the state (and some declined). The Republican bill would further rollback Medicaid expansion, and even traditional Medicaid.
Thus, due to reconciliation (and sometimes additional reasons), the Republican bill was essentially keeping the good but premium-increasing parts (e.g. no discrimination against pre-existing conditions), but trying to get rid of the parts that compensated for that (e.g. subsidies and the mandate).
This is part of why the CBO estimated millions would lose insurance. There were cuts to Medicaid and subsidies, while premiums stayed above the post-Obamacare level (higher than under Obamacare, due to no mandate) due to the pro-consumer provisions (e.g. essential health benefits, no discrimination against pre-existing conditions).
Thus, insurance was less affordable, and some people would either simply not be able to afford it at all, or make a judgement call that it was too pricey.