Congress is moving ahead with an ACA repeal but the timetables are all over the board as far as when and what will be included. It is clear however that the House will be much more aggressive. Reports are that House leaders would like to start to move legislation out of key committees as early as the first days after the President’s Day break is over on February 27.
Key components would appear to include 1) tax credits to buy insurance, 2) a medical health savings account (HSA) which are federal income tax-free savings accounts used to pay health care expenses, 3) some funding for “at risk” pools which would be set up by states to cover people who cannot get health insurance through the market, and 4) a complicated Medicaid cap called per capita caps or payments. These per capita cap payment proposals basically limit what states would get in reimbursement based on population or even targeted to specific populations, i.e. fixed amounts per child, per senior citizen, per disabled patient, etc. According to critics (Block Grant, Per Capita Cap No Substitute for ACA Medicaid Expansion) it amounts to a complex spending cap that has the benefit of a block grant that reduces federal funding and commitment to health care without calling it a block grant.
The Senate appears to be on a slower timeline with Senator Bob Corker (R-TN) being widely quoted last week as saying there have been no discussions in that house. Any House action would create pressure on the Senate to begin to move.
In addition to congressional actions, with Secretary Price now heading up HHS, he could begin to act on some regulations and guidance. ACA supporters fear he may loosen requirements on individual mandate requirements, peel back some of the requirements around birth control and ease requirements on the health insurance industry. All could have the impact of lessoning the number of participants in the exchanges which in turn could put pressure on health insurance premiums.
KEY CHALLENGES FOR ACA OPPONENTS:
- 21 million people currently insured due to the ACA provisions. Roughly half from Medicaid expansion. How does a replacement plan maintain one the lowest uninsured rates in the nation’s history? An uninsured rate at approximately 10 percent of the non-Medicare population, a roll back of Medicaid would automatically reduce coverage and a cut in premium tax credits would add to the uninsured rates. Any flexibility in Medicaid could prevent mandates to states to continue to cover people.
- Pre-existing conditions. The ACA prohibits insurers from denying coverage to a person simply because they have a “pre-existing condition.” Pre-existing conditions can include an on-going health issue such as heart disease or diabetes or might include denying coverage for something as basic as a family history of disease. Many, including the President, say they will keep this popular provision but its effectiveness is tied directly to requiring people to buy or have insurance (a bigger insurance pool of healthy people reduces costs). Some states such as New York had laws banning the insurance industry from denying coverage before the ACA. However, without requirements that force healthy people into the pool, costs will go up. A 1996 GAO report documented state changes before the ACA. Due to New York State reforms, the individual market went from 752,000 policies in 1994 to 34,000 by 1997 because costs went up. There is some talk of including a requirement that if you maintain continuous coverage you can keep a policy. Others say there are problems here too. What if a person can’t pay for premiums? A spokesperson for the American Cancer Society recently told the New York Times that 40 to 80 percent of cancer patients may stop working during treatment periods.
- Taxes. There are a number of different fees including the mandate penalty, fees and other revenue raisers. How do Congressional leaders repeal the taxes in one reconciliation and then try and reinstate other revenue raiser in a replacement plan? Can they get some of the more anti-tax members of Congress to go along?
- Hospitals. One of the major reasons the hospital associations joined in the original ACA negotiations was because of the unsustainable nature of having increasing numbers of uninsured patients coming to their emergency rooms. As part of the ACA, additional payments through Medicare and Medicaid, referred to as “DSH” payments were reduced. These DSH or disproportionate share hospital payments were given to certain hospitals in certain underinsured communities to offset the costs of these expenses of uninsured patients. If the ACA is repealed, do the DSH payments return? Beyond that how are stressed rural hospitals under financial pressure going to react to an increase in the uninsured.