For insight on how a Donald Trump presidency will look, experts are closely watching how he addresses healthcare reform: will he fast-track the repeal of the Affordable Care Act without a plan to replace, or will the businessman bring to the table a strategy of how to limit its inevitable ripple effect on providers, health plans, and consumers?
Throughout the primary and the race for president, Trump repeatedly vowed to repeal and replace Obamacare. The strategy of replacement is grounded in longtime Republican dogma: Fuel insurance plan competition by eliminating the barriers between states. Promote health savings accounts. Pledge block grants to pay for Medicaid and CHIP, and allow Medicare to negotiate its own drug prices. And shift as much of the delivery of care as possible back onto the free market to spur innovation and improve quality.
“When we win on Nov. 8 and elect a Republican Congress, we will be able to immediately repeal and replace Obamacare. We have to do it,” Trump said on Nov. 1. “I will ask Congress to convene a special session so we can repeal and replace. And it will be such an honor for me, for you, and for everybody in this country because Obamacare has to be replaced. And we will do it, and we will do it very, very quickly. It is a catastrophe.”
This is, unpredictably, the opposite of Democratic challenger Hillary Clinton, who he felled Tuesday night and who promised to tweak Obamacare, keeping much of its bones. And yet the fact remains: Twenty million people have purchased insurance plans through President Obama’s landmark reform law. And analyses predict Trump’s strategies could balloon the deficit by as much as $33 billion, largely due to the costs of uncompensated care and tax credits. The Commonwealth Foundation found that Trump’s strategies could leave anywhere from 15.6 million to 25.1 million without coverage. The Congressional Budget Office in 2015 pinned that number at 20 million.
“I think, from an industry perspective, everyone’s got their eyes on two outstanding questions,” says Benjamin Isgur, the Health Research Institute lead at PricewaterhouseCoopers. “One, how is this going to be defined? The repeal part, is that taken very literally in terms of attempting to repeal every single word or is that going to be repealing the parts that are not as popular, like the mandates? The industry doesn’t yet know how to react. And the second part of repeal is how to get from point a to point b; what’s the transition plan?”
Some of Trump’s proposals have stalled in the past. As PwC notes in a recent analysis, Congress has not passed bills that would allow Medicare to negotiate directly with drug makers. Safety concerns spiked the re-importation of prescription drugs.
As one of 19 states that refused to expand Medicaid under the ACA (or reach an alternative), Texas, perhaps, doesn’t have as much at stake as the states that did. In 2010, before the ACA, Texas sported the nation’s worst uninsured rate, of 24.8 percent. Today it sits at 16.8 percent, a difference of about 1.2 million. The other concern is the value-based models that providers have only just begun to grasp—the shift from fee-for-service into fee-for-value has not been an easy one, as evidenced by the Centers for Medicare and Medicaid Services softening its launch requirements for its outcome reimbursement program known as MACRA. All that is now on the table.
Mathew Eshbaugh-Soha, chair of political science at the University of North Texas, zeroed in on defining Trump’s transition plan. He cited the unpredictability of Trump’s candidacy, and his recurrent beating of the repeal drum. Now, the executive branch joins the House and the Senate as Republican-controlled. The House has—more than 60 times—passed legislation to repeal or walk back the law. The last time, in February, the reconciliation bill passed the Senate along party lines and wound up on President Obama’s desk. It was promptly and predictably vetoed, but would’ve struck tax penalties for uninsured adults, cut all funding for the subsidies offered to both consumers buying plans on the exchanges and through Medicaid expansion, and defunded Planned Parenthood.
The Senate needs 60 votes to get that legislation through with certainty. Repeal or a reconciliation bill—a budgetary strategy to defund key portions of legislation—are both very much on the table. The question then becomes: What replaces it?
“It’s difficult to make predictions about Donald Trump, as we’ve found out. But if they do it right and have some alternative in place, this needs to be a gradual repeal. I can’t imagine them doing it immediately because it’ll throw the system into chaos,” Eshbaugh-Soha said. “Immigration and healthcare … these two issues and how the Trump presidency tackles them and when they decide to discuss them during the transition will say a lot.”
Locally, most providers and insurance plans pitched to their membership associations or sent statements. Blue Cross Blue Shield of Texas, the state’s largest insurer and the only insurance company to sell exchange plans in all 254 counties, declined comment. But Scott Serota, the CEO of the association that represents the nation’s 36 Blue plans, sent over the following statement: “As health insurers for one in three Americans, we look forward to working with the new president and Congress to improve our healthcare system and ensure that Americans have access to high-quality healthcare at a price they can afford. In particular, we are sharing ideas for improving the individual market, so that consumers have more choices, better prices and a robust private marketplace that is predictable and stable.”
Steve Love, president of the Dallas-Fort Worth Hospital, chose to lean on the positive. Love is among a group of passionate proponents of Medicaid expansion, a suggestion that has fallen on deaf ears at the Republican-controlled Legislature. Now that the political stars are aligned and red, he suggested that reform could be found outside of the Affordable Care Act. He mentioned the expiring 1115 Medicaid Transformation Waiver, which has sent nearly $30 billion to hospitals to help offset the cost of treating the uninsured and developing plans to improve their access.
Trump is a vocal supporter of block grants, which involve the federal government sending money to the states and allowing them to disperse the funds how they wish. The Obama administration was long reticent to supply block grants without strings—especially to the 19 states like Texas, which gnashed their teeth at expanding Medicaid or finding an alternative. The aversion to block grants extended to Republican President George W. Bush, who refused to grant then-Gov. Rick Perry’s request to lower the rolls of Medicaid beneficiaries and redesign the state’s benefits plan. Most recently, Lt. Gov. Dan Patrick joined state Sen. Charles Schwertner, R-Georgetown, in a bout of political theater to call for a Medicaid block grant from President Obama instead of Medicaid expansion. The administration didn’t so much as respond publicly.
Trump’s unlikely ascent obliterates the stalemate between the Republican Congress and the Democratic president. Love says he hopes all parties can join together to try and infuse value into the nation’s healthcare system.
“I’ve been in healthcare since the early 1970s, dating back to when Medicare was enacted through President (Lyndon) Johnson’s administration,” he said. “We’ve had change in the White House, you know, Democrat- Republican, Democrat-Republican over the years. We had the advent of diagnostic related groups, we’ve had all kinds of shifts and changes in overtones that are maybe not as pronounced as the Affordable Care Act, but still we’ve always gotten through that. and the thing I always say, and I sincerely mean this, if we keep the interest of the patient and what’s right for the patient as the guiding principle, it doesn’t matter who is in the White House. We’ll do the right thing.”
Congress reconvenes on January 3, 2017, after open enrollment closes. Stay tuned.