Do you all remember Dr. Gail Wilensky? She was in charge of the role out of the Affordable Care and Protection Act (ACA). Her husband was a plastic surgeon in Washington, D.C. and since I was a plastic surgeon my doctor friends harassed me because I wasn’t doing more for the defeat of the ACA. And now we find Gail Wilensky, PhD discussing, in the New England Journal of Medicine, the Republican possibility of victory and that although it’s not unreasonable to ask how a Republican victory in the 2016 presidential election would affect health policy, it’s important to remember how policy becomes law. Presidents can propose policies — but preferably not in the form of legislative language, as President Bill Clinton did in 1993, when he sent a 1342-page proposal to Congress. Even though Democrats were in control of both the House of Representatives and the Senate, Clinton’s Health Security Act never came up for a vote — largely because of opposition to the policies it contained, but also because resistance was exacerbated by the way the executive branch had dealt with Congress. Only Congress can pass legislation enacting domestic policy, although as President Barack Obama has shown, substantial change can also be enacted through executive action. Of course, such changes can be undone in the same manner.
So understanding what a party “win” would mean requires not only understanding what a presidential candidate has proposed and what his or her party has included in its platform, but also guessing the outcome of the congressional elections and what the combined outcome of all national races means for health policy.
As a candidate, Donald Trump has supported several policy changes commonly proposed by Republicans. These include repealing the Affordable Care Act (ACA), though with little indication of what would replace it; expanding the availability of health savings accounts (HSAs, nontaxable money that can be used to cover medical expenses not covered by insurance and that can be rolled over from one year to the next, unlike flexible spending accounts); permitting insurance to be sold across state lines; turning Medicaid into a block-grant program; protecting people from large increases in insurance premiums or exclusions because of preexisting conditions, as long as they maintain continuous coverage; and allowing people without employer-sponsored insurance to deduct their premiums from their taxes. Unlike other Republicans, Trump has also proposed allowing drug importation and permitting Medicare to negotiate drug prices (though he hasn’t provided any details about what that would mean).
The Republican platform committee adopted policies that reflect some of the positions advocated by House Speaker Paul Ryan (R-WI) and the House Republicans, which are more expansive in some ways than Trump’s proposals. The platform’s wording more clearly recognizes the limits of presidential power, stating that the president should use “legitimate waiver authority . . . to halt [the advance of the ACA but] then, with unanimous support of Congressional Republicans, [should] sign its repeal” — a distinction that congressional Republicans have not always made. Ending the tax discrimination against non–employer-sponsored insurance, block-granting Medicaid, allowing the purchase of insurance across state lines, capping through tort reform the noneconomic damages for malpractice, and expanding the availability of HSAs are also included in the platform.
In the House, Ryan discussed alternative visions of health care reform both before and after the passage of the ACA, and he promised as speaker to release a House Republican health care plan. This plan was released in June, a month before the Republican convention.
Though not as specific as legislative language would be, the proposal provides much more detail than had previously been available about what a Republican replacement for the ACA would include. It also tackles some politically thorny issues, proposing gradually raising the Medicare-eligibility age to 67 and converting Medicare to a premium-support program that would include traditional Medicare as well as private-plan alternatives.
Some of the ideas in Ryan’s plan are traditional Republican proposals, such as selling insurance across state lines and expanding the use of HSAs. Existing ACA premium subsidies would be replaced by a refundable tax credit available to people not covered by Medicare, Medicaid, or employer-sponsored insurance. The credit would be financed by limiting the currently unlimited tax exclusion for employer-sponsored insurance — a more progressive answer to the “Cadillac tax,” a flat 40% excise tax on plans costing more than a specified threshold, because the tax imposed above the threshold level would be based on the individual’s tax rate and would thus be higher for higher-income employees.
Exclusions for preexisting conditions and higher-than-normal premiums would be prohibited for individuals who maintained continuous coverage. Premium prices would be allowed to vary by age, with the price for the oldest family member permitted to be five times that for the youngest (which is estimated to be closer to the actuarially calculated variation in health care costs) rather than the currently allowed 3-to-1 ratio, whereby younger enrollees implicitly subsidize the care of the just-pre-Medicare population. Medicaid would become a per-person block grant to states, and states would have more power, including the ability to require able-bodied adult recipients to work.
Senate Republicans have not collectively released a comparable proposal, but individual Republican senators such as Orrin Hatch (UT) and Richard Burr (NC) and former Senator Tom Coburn (OK) have been involved with proposals to reform Medicare or enact an ACA alternative.
Predicting election outcomes is always risky, and this year’s outcome seems more unpredictable than usual. Voter anger and dissatisfaction with political parties and traditional candidates has made political polling challenging. It is hard to forget the unexpected Brexit vote, which contradicted the results of polls conducted right before the vote, which had suggested that a majority of the population wanted Britain to stay in the European Union.
The easiest call in the 2016 U.S. elections is that split government seems highly likely. The House will probably remain in Republican control, according to most polls. The control of the Senate is likely to switch to the Democrats, if for no other reason than 24 Republican seats but only 10 Democratic seats are up for election. Whenever there’s such an imbalance (reflecting a lopsided election 6 years earlier), change in control becomes likely; a similar imbalance will occur again in 2018, when more Democratic than Republican seats are up for election. Political analysts such as Charlie Cook expect a relatively close split between parties, which means that the Senate will be subject to filibusters.
Democratic nominee Hillary Clinton is currently ahead in the polls, both nationally and in the “swing states,” and so appears to be the more likely winner — but polls have been wrong this cycle, and complacency is always a concern for frontrunners.
So what will split government mean for health policy? Any changes will have to be reached with bipartisan support — because Republicans and Democrats are each likely to control one house of Congress and there’s unlikely to be a supermajority in the Senate.
Republicans may be willing to provide support for strategies to help stabilize the ACA insurance exchanges — such as continued use of risk corridors (which limit the amounts that insurers can gain or lose through risk sharing) after 2016, perhaps with some increased funding from existing appropriations in exchange for increased flexibility using innovation waivers (1332 waivers), such as allowing budget neutrality to be measured over 3 years rather than 1 and allowing states to pool savings from Medicaid with those from exchanges. Agreement that states that have not previously expanded Medicaid should be given 100% federal funding for Medicaid for 3 years after 2016 might be attractive to both Republicans and Democrats. The government could also smooth transitions between Medicaid and exchange coverage by letting people use their Medicaid subsidies to buy insurance in the exchanges and their exchange subsidies to buy Medicaid coverage.
Ultimately, the biggest question is whether, if Republicans lose the presidency, the Senate, or both, they will be willing to work to “fix” the ACA, rather than focusing all their messaging and energy on repealing it.
And then Jonathan Oberlander, PhD, also in the same issue of the New England Journal of Medicine, went on to discuss what happens to Obamacare after its namesake leaves the White House? The Affordable Care Act (ACA) has faced fierce opposition from congressional Republicans and many GOP-led state governments, survived unexpected legal challenges, and overcome a disastrous rollout of healthcare.gov. Through it all, ACA supporters could count on President Barack Obama to defend the law. But come January 20, 2017, that will change. If Donald Trump becomes president and Republicans maintain congressional majorities, the GOP could seek to repeal major ACA provisions, though Trump’s health care agenda is uncertain.
If Hillary Clinton wins the presidency, however, Democrats can advance the ACA. For decades, reformers sought to enact universal health insurance. Now that they’ve taken a major step toward that goal, what happens next? Victory in the 2016 elections could allow Democrats to shift their focus from preserving the reforms to strengthening and improving them. The ACA’s record reflects both substantial accomplishments and significant shortcomings. One priority should be to make health plans more affordable and thereby achieve further gains in coverage.
The ACA has had remarkable success in reducing the uninsured population — from 48.6 million in 2010 to 27.3 million in January–March 2016, according to the National Health Interview Survey. But many Americans with modest means have not signed up for coverage in the insurance exchanges (marketplaces) created under the ACA
(see graph Percentage of Potential Exchange-Plan Enrollees Who Selected Exchange Plans in 2016, by Income Level.).
Even with government subsidies, insurance premiums can still amount to a substantial share of enrollees’ income. In addition, ACA marketplace plans generally have high deductibles and cost-sharing requirements, and people with incomes above 200% of the federal poverty level (FPL; in 2016, $11,880 for an individual and $20,160 for a family of three) receive only limited subsidies to offset such costs. Given limited financial assistance and the modest penalty for not obtaining insurance, many Americans have declined to buy coverage. That is one reason why exchange enrollment is much lower than projected, though many people are buying policies outside the exchanges and fewer than expected have lost employer-sponsored coverage. More than 6 years after the ACA’s enactment, insurance affordability remains problematic.
Even as the ACA substantially reduces the uninsured population, underinsurance persists. Many Americans are paying more out of pocket for medical care, especially for deductibles. This trend, which began before the ACA was passed, extends beyond the exchanges. For workers with employer-sponsored insurance, the average annual deductible increased from $303 in 2006 to $646 in 2010 and $1,077 in 2015. Clinton has proposed a refundable tax credit (up to $2,500 for an individual and $5,000 for a family) for Americans with high out-of-pocket costs. She’s also outlined a plan to cap out-of-pocket prescription-drug costs for persons with serious or chronic health conditions. Yet if major gains are to be made in marketplace enrollment, ACA plans may have to be made more attractive, with larger premium subsidies and better cost-sharing protections. Higher enrollment could also be achieved by increasing the penalty charged for not obtaining insurance, but that would be controversial.
A related priority is stabilizing the marketplaces. Premiums are rising for ACA plans, and some insurers are requesting large increases for 2017, though state experiences vary widely and through 2016, exchange plans’ premiums have been much lower than expected. Three major insurers — UnitedHealthcare, Humana, and Aetna — have decided to curtail participation in the exchanges, citing financial losses and risk pools of people who are sicker and more expensive than anticipated (though Aetna’s announcement followed an Obama administration challenge to its proposed acquisition of Humana). Other insurers are doing well financially with their marketplace plans, and in some states insurance competition remains strong. But in a growing number of geographic areas, consumers shopping for insurance on the exchanges have little choice, since one insurer has a monopoly.
Ironically, private insurers’ withdrawals could revive interest in a reform they intensely oppose: creation of a Medicare-like government insurance plan that would compete alongside private plans in the marketplaces. Clinton has endorsed such a public option. Although it will face an uphill struggle in Congress unless (and even if) Democrats regain House and Senate majorities, some states could use innovation waivers, which will be newly available in 2017, to create their own public options. Democrats could also pursue another policy Clinton supports: enabling people 55 years of age or older to enroll in Medicare — though that proposal, too, faces considerable political barriers.
As use of state innovation waivers begins, policies aiming to stabilize the marketplaces will end. Reinsurance and risk corridors, which protect insurers against the costs of enrolling expensive patients and potentially large financial losses, are scheduled to expire later this year (and because of restrictions passed by Congress in 2014, insurers have actually received only 12.6% of the risk-corridor payments the government owes). The expected expiration may be contributing to 2017 premium increases, which might dampen enrollment. One fix would be to maintain these policies — which are already a permanent feature of Medicare’s Part D prescription-drug program that relies on private insurers. The Obama administration has taken steps to steady the marketplaces and improve insurers’ risk pools, including limiting the use of special enrollment periods outside of scheduled open enrollment. The next administration may have to consider additional stabilization measures. Indeed, this could emerge as Clinton’s most pressing health policy challenge.
Making marketplace health plans more affordable would help stabilize insurer participation and ensure further progress in reducing the uninsured population. Democrats could also remedy the “family glitch”: under the ACA, people deemed to have unaffordable options for employer-sponsored coverage can receive premium tax credits to buy marketplace plans, but many people are ineligible for such subsidized coverage because affordability is evaluated on the basis of the premium cost for an individual worker, not on the price for family coverage.
Another way to boost coverage rates would be to persuade more states to expand Medicaid. Three million uninsured low-income people would become Medicaid-eligible if their state accepted the ACA expansion (19 states have declined to do so). A Democratic victory in November could convince some GOP-governed states that the ACA is here to stay and that they should heed Medicaid expansion’s economic and fiscal logic, as well as political pressures from health care provider lobbies. As an incentive, Clinton has proposed extending provision of 100% federal funding for the first 3 years to any state expanding Medicaid. Making that funding level permanent — it’s scheduled to phase down to 90% by 2020 — could further entice states. There are also about 9 million uninsured Americans who are eligible for but not enrolled in Medicaid or the Children’s Health Insurance Program. Vigorous outreach and enrollment efforts are needed to reach these people and those eligible for subsidized marketplace coverage — together, they account for nearly half the remaining uninsured population.
Although the challenges in extending coverage gains are drawing attention, the cost of medical care could also become a prominent issue in coming years. Growth in health care spending has been remarkably moderate since 2008, and the ACA has cost much less than initially forecast. Obamacare has produced considerable Medicare savings, though its precise contribution to the spending slowdown outside that program is unclear. We don’t know how effectively the ACA’s payment and delivery reforms will slow medical spending over the long term. If spending accelerates, policymakers could consider strengthening those reforms or adopting alternative approaches, which are already in the wings with payment bundling, MACRA, MIPS and Meaningful Use. You wonder why more and more physicians are getting burned out??!! Implementation of the Cadillac tax on high-cost private plans, a cost-containment policy favored by many economists but opposed by much of the public, has been delayed from 2018 to 2020. Clinton supports its repeal, a call that’s likely to grow louder if she is elected president and is running for reelection in 2020.
The biggest obstacle to building on the ACA’s achievements and addressing its flaws is hyper-partisanship. Lawmakers are deeply polarized, and public attitudes about health care reform are divided. Even modest changes can become existential struggles in this environment. If Clinton is elected, her chances of strengthening the ACA will depend on whether Democrats have congressional majorities — and on her ability to advance reform in this extraordinarily polarized time.
But what these writers are forgetting is that Hillary has already “promised” a Medicare For All or the public option. Either will result in a system more like the Canadian or European system and we all know the failures, delays, and restrictions.
The Republicans with all the possibilities of alternatives and the threat of repeal of the ACA have not really proposed a worthy alternative to the ACA.
I would be very surprised if Mr. Trump can pull it off and win the election, therefore we will be looking at a public option or Medicare For All health care system.
I will be discussing and dissecting this public option in a future post and what we really need for a sustainable healthcare, which is fair to the majority delivering the best health care for all. Is this even a possibility?
Tune in again in the weeks to follow and send me your comments and suggestions.