ACA Status?

Two forces are at work, literally laying in wait to decimate the ACA (aka Obamacare). There are the Trump campaign promises to throw it away, coupled with increased Republican power. In an Election Day upheaval, we now have a clean Republican sweep at the Federal legislative and executive branches, which means impending Republicanizan on the judicial branch. With virtual control of the White House and both chambers, the GOP will have the votes to cast Obamacare away.

The question isn’t if they’ll do it. The relevant questions are how they’ll dismantle it and to what extent. Those on the party's conservative wings are already clamoring for repeal as a top Trump administration priority. But Trump himself has consistently vacillated on this complex issue. One moment he makes unequivocal denunciations (‘it must be killed’) with furrowed eyebrows, and the next, when pressed for an alternative, he comes up with vague notions sounding similar to what Obamacare already offers.

So where is this going?

First, Republicans won’t be able to repeal the law en masse. Without the necessary 60 votes to overcome a Senate filibuster, they will have to rely on the budget reconciliation process, which only requires 50 votes to remove the budgetary pieces of the law. This was the template for a repeal bill Republicans passed this past January, before being vetoed by President Obama. The exercise was described as a pilot for just this utopian Republican scenario.

In the already flown pilot version, the law’s Medicaid expansion program, insurance subsidies, its tax penalty mandate, and other taxes to fund its other programs would be jettisoned. However, its non-budgetary provisions, like its requirements that insurers don’t drop consumers on the basis of pre-existing conditions and that they allow young people to stay on their parents’ plan until they’re 26, would be preserved. Embittered Liberals are speaking to the humane side of further loss of insurance for many Americans, and putting up an economic defense that a partial scraping such as what the Republics propose will do more harm than good in terms of insurance costs. They claim a partial take-down would leave enough of the initial concept in place, but without critical balancing levers. They are right. The plans have been made richer through the extension of dependent coverage, neo natal care, pre-existing condition waivers and other add-ons to the point where, in the absence of fat government subsidies, few could afford such comprehensive coverages.

Beyond health insurance consumers, from a political perspective, it’s a mine-field. When GOP lawmakers were discussing and revising the bill, some Republican lawmakers complained about eliminating the Medicaid expansion provisions that benefited thousands of their constituents. Going in, they knew Obama would veto the bill, so they signed anyway. Now we don’t know if they will sign the go live bill. Few can predict untested human performance in actual battlefield conditions.

So here is where it gets interesting, if it is reasonable to postulate that this subject could ever be interesting. All the Republicans have staked their claim on getting rid of it, but few can agree on what it will be replaced with. Smart money is on Libertarian thinking prevailing in cases like this, which does not by any means portend to an orderly transition from the rich plans/subsidized plan scheme that is now in the marketplace. Trump and his people will attempt to give the whole thing back to the marketplace, and to get the government out of it. The government will be seen as the third person on a blind date, someone who has to leave in order for the couple (health care consumer/health care delivery system) to succeed in their dealings. This will force the government to continue paying subsidies the next 3 years and then phase them out, turning the game over to what this group hopes will be a highly competitive market eagerly fighting each other to lower costs on behalf of the discerning consumer.

As President-elect Trump will come to learn, this supply side thinking can work, but not well with obstacles like critical shortages of primary care physicians, critical shortages of health insurance companies (many have gone out of business or have been acquired) and strong resistance from the health care delivery system to invest in areas where the patients can’t afford to pay for health care. I don’t envy President Trump and his cohorts in Washington. They’ve painted themselves into a corner. They are going to replace something evil that undoubtedly will be painted as being much worse by disaffected Democrats. And the Democrats will probably be right. Ideological arguments aside, what it has all amounted to are record numbers of uninsured people and millions of people with high deductible health insurance plans. The latter means record profits for the health insurance companies that are big enough to stay in a rough game of tackle football.

Hillary Clinton and Ira Magaziner found out a long time ago that the road to hell is paved with good intentions. But Hillary is a good example of how you should respond. You just keep going forward. And I am sure she is as curious as the rest of us as to how Obamacare ultimately plays out.


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